PATTERN: New Theory of the Firm (pattern)
CONTEXTUAL PATTERNS: Institutions
We can work together more humanely and more effectively if we consider the new possibilities for organisation afforded by collaboration technology in realtion to psych-social science.
Economist Ronald Coase developed his 'Theory of the Firm' in the 1930s. Simplistically, he asked himself why some contracts were re-negotiated regularly (buying apples), while employment contracts and others associated with firms were (in those days) assumed to be indefinite. His answer was that transaction costs dictated where the boundary lay: renegotiating office premises or who did the filing on a daily or weekly basis involved very high costs.
Today, it is clear that tech has changed the landscape. Firms are shrinking. SaaS, platform approaches, dropbox, coffee shop wifi, smartphones - all reduce transaction costs in many dimensions. Twitter has 4600 employees to service 300M plus users - 1 per 60,000. US Postal Service has nearly 500k employees to service a population of 330M.
A new Theory of the Firm proposes voluntarist 'crews' of human scale , working in voluntarist constellations around purposes which they wish to support, in the context of workflows, governance and agreements that have low transactions costs.
CONTRIBUTORY PATTERNS: An approach to explicit structure is to use Purpose, Agreement, Policies and Daily Life.
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Monday, 13 January 20 09:32:34 Europe/London