Archive for the ‘Business’ Category

About Combining the Combinations

Monday, May 30th, 2011

 

steam_engine

Evolution means the creation of larger and larger islands of order at the expense of even greater seas of disorder in the world. In the process of evolution, each succeeding species is more complex and thus better equipped as a transformer of available energy.: Jeremy Rifkin, Entropy: A New World View (1980).

You wouldn’t enjoy a perfectly ordered universe. A wholly ordered universe would be at perfect equilibrium and would be dead. There can arise no Order unless there is a Flow of Matter and Energy which decreases in intensity as a system moves toward equilibrium. Motion, change or evolution in the Universe is driven by fluxes of energy and energy-rich matter flowing from sources of high potential to sinks of lower potential.

During the road from Being to Becoming Cyclic Auto-Catalytic Systems are created that Re-Create themselves until they Die. Islands of Order Appear and Disappear in the Sea of Chaos.

About Thermodynamics

Thermodynamics is the Science of the Transfer of Energy.

In strict Scientific terms Energy is classified into two main forms: Kinetic and Potential energy. Kinetic Energy is defined as the energy of a moving object. Potential Energy is defined as the energy in matter due to its position or the arrangement of its parts. The various forms of Potential Energy include gravitational potential energy, elastic potential energy, chemical potential energy, and electrical potential energy.

The First Law of Thermodynamics says that the total quantity of Energy in the universe remains Constant.

The Second Law of Thermodynamics states that the quality of this energy is degraded irreversibly. The Second Law predicts that our Universe will end when the Explosive Motion of the Big Bang wil stop and we will reach the Absolute Zero.

Nicolas Léonard Sadi Carnot (1790-1832) detected the Second Law of Thermodynamics when he tried to find the most efficient heating engine.

According to Carnot the Efficiency of an Engine is (T1T2)⁄T1, where T1 is the highest temparature. The Higher the Difference between the two Temperatures of the Engine the Lower the Efficiency. The Bigger the Step the Higher the Waste. If you want to build a highly efficient Engine, the Engine has to make very Small Steps when the Engine is heated.  This principle is known as Adiabatic Expansion (and Compression).

Physical, Chemical, and Electrical energy can be completely changed into Heat. But the Reverse (heat into physical energy, for example) cannot be accomplished without a loss. The irreversible increase of this nondisposable, useless, energy in the universe is measured by the abstract dimension  called Entropy (from the Greek entrope, change).

The Entropy measures the degree to which the probability of the system is spread out over different possible states. If all the possible States of the System are the Same, the System is in Equilibrium and the Entropy, the State of Order,  is on its Maximum.

In the Beginning of the Universe Every Thing was Different. In the End State Every Part of the Universe will be the Same.

About the History of Innovation

The central actor in the 19th century model of cultural innovation is the Artist, conceived, as an individual creator of works of art. Art is produced only by a handful of exceptional individuals.

The process of technical innovation in the 19th century was seen in terms similar. The central focus was on the work of individual inventors and researchers, commonly with little or no specifically scientific training.

By the early 20th century, this model was displaced by an industrialized process of innovation.

The first major step in this process was the rise of the Research University and the development of a large class of technically trained workers. In the 20th century, pure scientific research had become the preserve of universities and specialist research institutes.

The second major step was the development of corporate forms of business organization, which allowed Research and Development to become an organized business activity, operated on industrial lines.

The pattern of innovation in the 21st century is radically different. In most sectors of the economy, the rate of technological progress has slowed down substantially. Technological progress is characterised largely by Incremental Improvements to mature products.

In Computing and Telecommunications, the rate of progress has accelerated dramatically since the late 1980. The convergence of Computing and Telecommunications in the Internet has fundamentally transformed every activity it has touched. Everything that can be formalized will be formalized.

The Internet makes it possible that disjunct Networks of Isolated Innovators connect and share their Knowledge and Experience.

The Artist,  now connected with many other “exceptional individuals” all over the world,  is on its return.

About Incremental and Disruptive Industrial Innovation

There are two types of Industrial Innovation called “incremental”  and disruptive” innovation.

Japan (and now China) has made incremental improvement the cornerstone of  Technical Advancement. After months and years of gradual (adiabatic) changes, products look radically different, as happened with semiconductors, solar cells and batteries.

The US claims that it is the Champion of Disruptive Innovation.  Their “Internet”-entrepeneurs like Amazon, Google and Facebook believe in a “Statistical” model of Innovation, A Portfolio or an Innovation Ecology.

One of the many “Trials and Errors” will result in a big breakthrough that will Disrupt the Market. Behind Disruptive Innovation lies the Concept of Evolution, Survival of the Fittest, the Essence of Capitalism.

Disruptive Innovation uses Incremental Innovation to improve the Parts of the Portfolio.

Incremental Innovation (“Proces/Product/Business Model Improvement”) takes place  when an Innovation is improved until the Limits are reached.

Incremental Innovation could use the Efficient Small Steps of the Adiabatic Process to reach the Goal of the highly Effective.

Most of the time Proces/Product Improvement (“Standardization”) is not a Structured Process because People believe Innovation is about “Thinking Out of the Box”. If People “Think out of the Box” the proces will move into a Chaotic State and will Die.

Creative Incremental Innovation will produce a Lot of Waste (“Heat”, “Fuzz”) and accomplish Nothing. Managed Incremental Innovation has to remove the Waste and the Constraints.

With every step that is taken the System has to become more probable so the results of the proces will be more predictable. When the Limits are reached, we have to Restucture the System to move on.

The Second Law of Thermodynamics shows that Closed Systems finally Converge to a State of Equillibrium with a High Probability, a High Entropy.

Systems that are Isolated by a Boundary behave as Closed Systems. Systems that are Open to other Systems Merge and become Closed.

Most of the Time people don’t understand the Boundary of their System and Act in a Shared Boundary. In this Shared Boundary Competition takes place. Competition is a waste of Energy. If People could define their Boundaries they could Cooperate.

People Communicate. They  Share their Ideas, Problems and Solutions.  When a Process is well understood the Improvements of the Process are disseminated through the Human Networks and widely Copied.

Human Networks are Closed Systems that are connected to other Networks by Boundary Spanners.

Most people don’t understand that there are other people in other Networks who are doing the Same thing they are doing. They think their activity is Unique and don’t understand that the State of Uniqueness was only there at the Beginning.

Secrecy slows down communication between the People in the Network. The result of Secrecy is that People are unable to learn from others so they are unable to reuse the solutions of others. Secrecy is again a Waste of Time.

In the end the Competitive Advantage of the Innovation is completely gone and the Entropy of the System is at its Maximum.

At that moment every Process in every Part of the System will be the Same and the Companies will Merge or will be taken over by other Companies. Winner Takes All.

The Temperature of the Industry will move to Zero and every Movement (and Innovation) will stop.

About Creativity

There are two Views on Creativity. Creativity is a Combinatorical Game and Creativity is a Spontaneous Eruption of Ideas forced by High Pressure.

At such a moment, “the Aha-Erlebnis“, two or more Frames of Reference Fuse and a new Innovative Combination is created.

The last view has a lot to do with the theory of “Self-Organized Criticallity“.

The Metaphor of this Theory is the Disaster, the Avalanche or the Sand Pile that Suddenly moves when the critical grain of sand falls. At that moment a Significant Part of the Collection of individual grains Combines and moves on its own.

When a System is reaching the Boundaries of Proces Improvement and a Huge Pressure to Innovate is experienced,  two or more Systems (“Frames of Reference”) Fuse (Combine).

When the Systems are in Equilibrium the Fusion is easy (“Connecting”) otherwise the Fusion could become a Disaster, a Disruption, a Creative Destruction and a Huge Amount of Heat (Waste) is produced.

About Managed Creativity

If Innovation  is a Combinatorial Game we have to restructure a System into a “loosely-coupled”  System of Components and combine the Components with the “well-articulated” Components of other Systems.

A Loosely Coupled System is a System where each of its components has, or makes use of, little or no knowledge of the definitions of other separate components. The components act as Black-Boxes“.

A Component is “well-articulated” if it contains Just Enough Functionality to do the job. An Under-Articulated system is Rigid. It contains Not Enough functionality to Adapt to the Changing environment. When Systems grow old they become Over-Articulated because the Designers want to add new functionality without looking at the Boundaries of the System. Over-Articulated Systems overlap and it becomes very difficult to find the Essence. Designers always want to Solve every problem with their Own System.

Genrich S. Altshuller was a Russian Patent Officer who tried to find a Pattern behind Patents.

Altshuller screened over 200,000 patents looking for Inventive problems and how they were solved. Of these only 40,000 (20%) had somewhat Inventive solutions; the rest were straight forward improvements.

Altshuller defined an Inventive problem as one in which the solution causes another problem, a Contra-Diction or Conflict,  to appear. He found that the same problems had been solved over and over again using one of only Forty fundamental inventive principles. Altshuller  named his method  TRIZ.

Humans are prone to reivent the Wheel many times because they only look for Solutions in their own Frame of Reference. The Solution of their Problem is almost all the time already available in another Domain.

Roni Horowitz has analyzed the Principles of Althuller and found a deeper structure behind TRIZ which he called ASIT.

ASIT is about Thinking Inside the Box instead of Outside the Box. The so called Closed World condition, forces the thinker to find a creative solution by heavily limiting his or hers Space of Possibilities.

The Qualitative Change Principle looks for solutions in which the influence of the main problem factor is either totally eliminated or even reversed. The System has to become Perfect. Every Component has to fullfill just one Task  (“Well Articulated”) and the Functions of the System have to create a “Closed World” which means that the System has to be Closed in Itself.

About Combining the Combinations

The Second Law of Thermodynamics shows that it is Almost Impossible to move back to an old solution when the Solution is widely used.

Nature Solves its Problems by Experimenting but the Experiments are not completely at Random. Nature uses an Established Infrastructure and Plays with all the Possible Paths that Emerge out of the Existing Infrastructure, The Adjacent Possible.

Before life emerged on Earth, the planet was dominated by a handful of basic molecules. Each of these molecules was capable of a finite series of transformations and exchanges with other molecules in the primordial soup.

According to Stuart Kauffman Life  started when the Chemical Parts of early life  started to Re-Create themselves in a Cyclic Process  called AutoCatalysis. Re-Creation of the Same Structure is one of the most important principles of a Living System. Our body is recreated all the time in an endless Cycle until we Die.

If you could Play with all the Primordial Combinations, you would end up with the Components of Life but it is impossible to create a mosquito, or a sunflower, or a human brain.They were created when the Combinations started to Combine Again and Again.

Innovation in Nature is an endless Cyclic Expanding proces of Combining the Combinations.

This process moves on until the Limits of the Expanding Space of Possibilities are reached. These Limits are reached when there is not enough “useful” Energy available.

Combining the Combination happens in Nature but also in our Culture. Old infrastructures are used in a new way and a complete new field of Combinatorics appears.

Johannes Gutenberg took the older technology of the screw press, designed originally for making wine, and reconfigured it with metal type to invent the printing press which made it possible that new ideas, concepts and procedures were better dissiminated through the Human Networks.

Is there an End to Human Innovation?

The Universe is Expanding and is Creating New Combinations of Combinations all the Time.

The Law of Kleiber shows that the Combinations of the Combinations Fuse. The Law of Kleiber is just like Self-Organized Criticallity represented by a Power-Law. Power-Laws are independent of a Scale and therefore applicable on every Level of the Universe. They show that One Principle (“a Fractal“) Repeats itself on every Level.

Every time when the Combinations Fuse they are better equipped as a Transformer of Available Energy but the Creation of larger and larger islands of Order happens at the Expense of even greater seas of Disorder. Humanity is Wasting resources at an increasing rate, and that will lead to the destruction of our civilization.

The Combinations become Bigger and Bigger AND the Big Structures Attract Each Other. The larger group of possibilities will always be the Dominant Attractor.

This is the main reason for the success of Google, Facebook and Twitter. They have aquired the Power to Control their Market by Giving away their Products for Free so the Amount of Users would grow Exponentionally. They make money by letting other companies pay for the Use of their Huge Attractor.

The Small Auto-Katalytic Chemical Factories, the Bacteria,  that were created in the beginning are now fusing into Very Big Cities and the next Step will be One Mega-City covering a Huge Area of the Earth.  These Mega-Cities will be extremely Efficient and Effective. When this happens Nature will be replaced by a Human Made Technological Structure that has to use completely new ways to produce and use energy.

The next Step is easy to imagine. The Human Race will start to create new Mega-Cities on other Planets that will fuse into Mega-Planets.

The Big Problem will of course be Energy. We have to find new Sources all the time to support the Human Need to Expand and Discover. Every time when we create a new and Bigger Source of Energy the Amount of useless Heat will increase and the End of the Universe will get closer and closer.

Human Invention is Speeding Up the End because in the End Humans want to become One with the Whole.

According to the Second Law of Thermodynamics the Universe is moving to an Equilibrium State and not to an Extremely Impossible Innovative Configuration. At a Certain Point of Time Human Innovation has to Stop because we will reach the State of Absolute Zero Temperature and every Movement will Stop.

In the End the Universe will move into a State of Infinite Sleep.

What to Do?

The most important thing you can do when you want to Innovate is to create a Deep Understanding of just One Frame of Reference.

You have to become an Expert in Something and you have to have the attitude to create the Perfect Frame of Reference.

Every time when the System is not performing you have to solve the problem Inside the Box but you have to make use of Solutions that are Outside the Box.

Every Time when you are Satisfied,  remove a Constraint and Force Yourself to Solve the problem.

At a Certain Moment your Frame of Reference will Explode and will produce many Fragments. They are the Basic Building Blocks of Your Domain.

Start to Play with the Building Blocks and new Possibilities will appear that you have never Thought off.

You now have entered the Adjacent Possible.

LINKS

About Creativity and High Pressure

About Self-Organized Criticallity

About Self-Organized Criticallity and Innovation

About Complexity Theory and Innovation

About Loosely Coupled Systems

About Boundaries

About Triz

Stuart Kaufmann about Radical Emergence

Advanced Systematic Inventive
Thinking

About ASIT (Advanced Systematic Inventive Thinking)

How Nature Plays

About Constructal Law

About the Origin of Good Ideas

About the Adjecent Possible

About the Law of Kleiber

Why Cities are Organisms

About the Beginning of the Universe

About  the End of the Universe

About the Productivity of Knowledge Workers

Monday, August 10th, 2009

blue collar workerIn the 19th Century The Blue Collar Workers were replaced by Machines operated by White Collar Workers.

When the White Collar Workers were replaced by the Software of the Programmers a new Type of Work was created, called Knowledge Work.

It is very difficult to measure the Productivity of the Knowledge Worker.

In this Blog I will show you that the Problem of the Productivity of the Knowledge Worker can be solved when you Realize that the Business Cycle is a Self-Referring Object (A Fractal).

Work is a Process and is part of a Business Cycle. Work has a Result and it uses Resources.

When the Result of the Process is accomplished somebody has to Use the Results. The process of Use is called Consuming.

When a Requirement is Transformed into a Result and the Result is Sold (Sales) and Used somebody starts to Think, gets Ideas, about Adapting the Requirements and the Cycle of Work is Closed.

When the Requirements are Satisfied we call the process Effective. The process is Efficient when Waste is minimized.

In the Business Cycle the Four “Organs” of the Human, Control, Desire (Consume), the Emotions (E-value-ate) and the Imagination (Create) are Dominating a Phase. The task of the fifth Organ, Conscioussness, The Monitor, is to Balance the Four Organs to make sure that one Human Faculty is not dominating the Cycle. The Business Cycle is Self-Referring.

This means that we are able to apply the Business Cycle in every part of the Business Cycle. A Salesman makes the Requirements of a Sales Plan, Executes a Sales Plan and Improves his Sales Cycle when he gets new Ideas about the effect of his efforts.

What we see is the process of Specialization resulting in the Division of Labour.

Every time when a new specialization of the Business Cycle is created the Level of the Process changes and the Speed of the Movement of the Cycle, the Periodicity, changes. Every Time when a new Division of Labour occurs the Business Cycle Speeds Up.

The Division of Labour not only Accelerates the Business Cycle. The New Roles in the Cycle behave like an Independent Unit. They want to Dominate Cycles on other Levels and most of all they want to expand their Activities.

The Personal Assistant who was helping the Manager to Hire and Fire Personnel transforms into a Human Resource Management Department.

At some point in time the specialized Units disconnect from the Whole and start a Life of their Own. Designers start Design Bureaus. Teachers unite in a School. Scientists cluster in Universities.

All of them are still payed by the Primary Processes in Society (Agriculture (Food), Industry, ..) but the Secundary (or higher order) processes don’t want to hear that. They think they are the Most Important Processes in Society.

When the new Wholes are created they start to Divide again and again. The Result of the Split of the Work Cycles, the endless Division of Labour, is an Incomprehensible, not Effective, Inefficient Network of Competing Work Processes Clustered in many Institutions.

The Business Cycle is Breathing.

When the process of Splitting has gone too far, the process of Union and Integration starts.

Splitting, Expansion, occurs when the Economic Cycle is going Up.

Integration, starts when the Economic Cycle is going Down.

We are now again in an Integration Phase which means that many secundary and higher order processes will be destroyed until the Essence of Society is visible again.

What is a Knowledge Worker?

A Blue Collar Worker works in a Factory and is doing Manual Labour. The people who are part of the Staff Departments of the Factory (Sales, Planning, Design,) are called White Collar Workers. White Collar Workers are more Educated as the Blue Collar Workers. They Earn more money and are doing Intellectual Work. The Knowledge Worker Uses and produce Knowledge. Examples are: Programmers, Systems Analysts, Lawyers, Teachers and Scientists. Examples of processes are: planning, acquiring, searching, analyzing, organizing, storing, programming, distributing and marketing.

What is Productivity?

The Concept of Productivity implies that an organization works as a Physical System with variables and their inter-relationships amenable to precise definitions. The basic reliance is on the acceptance of a Stimulus-Response model of Causality that an Input causes an Output.

Productivity is the ratio of Outputs (Goods and Services) divided by one or more Inputs (Labor hours, FTEs, Capital, Expenses). Using money as a measure of value makes it possible to compare dissimilar inputs and outputs.

Productivity is only applicable in the Production Phase of the Business Cycle. In the other Phases other Measures are used like Customer Satisfaction in the Consuming Phase. Customer Satisfaction is a measure of the Effectiveness of a Production phase.

The Business Cycle is a Self-Referencial Object. Every Phase of the Business Cycle can be divided in the Phases of the Business Cycle. This means that the Productivity of the Knowledge Worker can be Measured when he is Producing Something (A Design, A Research Document, A Plan).

If the Knowledge Worker is not Producing anything there is nothing to Consume in the next Phase. In this case the Knowledge Worker is not Effective. If this happens the  Knowledge Worker has to Reflect, Use his Consciousness, to detect his Added Value to the Whole he is part of.

To Define the Productivity of a Blue of White Collar Worker, the Process has to be Standardized. To standardize a process you have to define the Flow of the Components (Bill of Materials) and of course the Product, the Result.

If the Process is Standardized it is very easy to get rid of the Waste in the Process (Process Improvement). When this happens the process becomes more Efficient (now called Sustainable).

Standardization results in a Decrease of the Workers, a Lowering of the Waste (Costs) and an Increase in Rules. The Process Rules are implemented in Machines and Software.

What are Knowledge Workers Really Doing?

The Designers and Implementers of the Rules, the Knowledge Workers, are the people who are Destroying the Work of the Blue and White Collar Workers in a Factory. They are also the Creators of New Factories (Business Development) and connect Old Factories (Value Chain Integration).

How to Measure the Productivity of Knowledge Workers.

Knowledge Workers are part of the Business Cycle. They Analyze Work Processes to minimize Waste, Evaluate the Results of the Consuming of the Result of a Work Process (the Product) , Imagine and Test new Ways to Satisfy the Needs of the Consumer, Design New Work Processes or Change Existent Work Processes.

The Business Cycle is Self-Referring. This means that you can organize the Work Processes of the Knowledge Workers just like the Work processes they Analyze.

If you measure the Productivity of the Work Process of the Blue and White Collar Workers in a certain way, it must be possible to measure the Productivity of the Knowledge Worker in the same way. Knowledge Workers also have to make plans and have to evaluate their own products to Learn and to Improve their Performance.

This approach has a great advantage. If you treat the Knowledge Workers just the way you treat the Blue and White Collar Workers they will understand that some day the Controller will Standardize Knowledge Management, Reduce the Waste, Focus the Process on a Clearly Defined Target, Eliminate the Knowledge Workers and Replace them by a Very Intelligent and Creative Software Program.

These Software-Programs are already there (Expert Systems, Artificial Intelligence, Pattern Recognition) and are constantly improving their behavior. One of the most interesting examples is Wolfram Alpha.

When the Fractal Pattern Recognizers are fully operational the Knowledge Workers will Realize that the White and Blue Collar Workers are also Humans. They will know that every Human has the ability and the need to Control his own Process of Life.

They will see that Every Human has Desires, Emotions and Imagination.

They will become Aware (Consciouss) of the Fact that every Human is Able to Improve his Own Work Processes.

fractal

Many Reasons to Believe that the Economy will not Recover in a Short Time

Wednesday, June 24th, 2009

The Unemployement and the Stock Market are rising for some time now. A new Stock Market Bubble is building up and will explode in the near future. The biggest Bubble is certainly the US Deficit Bubble.

The Stock Market Bubble and the Deficit Bubble will explode as soon as the major creditors (China, India, …) of the US will move out of the Dollar. This is happening already.

The Customers are the backbone of the Economy and the Leaders understand very well that the Economy is governed by Psychology. So Bad News is hidden en Good News is exaggerated. The Expectations of Analysts are always beaten and the downfall is falling slower than before.

The Economy is still in a terrible state and this state is getting worse every day. The unemployement is still rising and will rise for a very long time because companies are getting broke or are rationalizing everything that is possible.

They replace their employees by IT-Technology and Cheap Labor. The customers are not buying, they are saving more and more money for a rainy day or are paying back their debts.

Saving money will not stimulate the economy. It stimulates unemployment. The rising unemployement results in more foreclosures and problems with credit card debts. The Economic Downturn is just at its beginning.

Economist John Williams says that– if the unemployment rate was calculated as it was during the Great Depression the unemployment figures for July 2009 rose to 20.6%. According to an article summarizing the projections of former International Monetary Fund Chief Economist and Harvard University Economics Professor Kenneth Rogoff and University of Maryland Economics Professor Carmen Reinhart,… unemployment could rise to 22% within the next 4 years or so.”

The Scenario of the Current Downturn is highly comparable with the Scenario of the Great Depression with one exception. The current Downturn is much deeper than the other. We are approaching the Biggest Global Economic Crisis in Human History.

The current investors base their policy on positive news and ignore the bad news. They believe the economy will rise when the customer-confidence is rising or when the downfall of the economy is “slowing down” or “bottoming”. They don’t see that a slowing down of a downfall is still a downfall.

The investors, the Doves, act just like the behavioral economists predict they will act. They read the headlines, believe the Hawks and are not aware of the (Money) Illusion the Government, the Media and the Banks are creating. The Hawks know better. They buy Silver, Gold and certainly the best investment, Oil.

Nouriel Roubini has a more realistic view on the economy. In his article Ten Risks to Global Growth he analyses the risks that could block the recovery of the economy and his conclusion is highly pessimistic.

According to Roubini the major cause of the crisis is overspending. Overspending is a normal activity when the Kondratiev-Cycle is in the state of Autumn. The debts are always repayed in the next phase, Winter. In the Kondratiev Winter the economy is purged and cleansed. This phase started around 2000 and will be finished around 2013. In the Winter-State you have to stay in cash or invest is Gold and Silver.

At this moment the investors don’t know what currency they have to chose for their cash-reserves. Usually the Dollar was a Save Heaven but the current policy of the FED to expand the amount of Dollars to an almost unbelievable amount is seen as a huge risk.

The Creditors (China, India, ..) of the US are already creating an alternative currency and are secretly and slowly moving out of the Dollar. If the Trust in the Dollar has gone the US Economy will go bankrupt.

The big problem with the current Cycle is that we have moved to the Level of Earth. In the last downfall of the Kondratiev Cycle other parts of the world were decoupled. They moved in a complementary mode. The Down of one part of the Earth was compensated by an Up somewhere else.

At this moment the complementary parts are synchronized and act and react according to the same rhythm. This rhythm is related to a longer term cycle that almost nobody is aware of. This cycle with a periodicity of 250 years is called the Secular Cycle.

The current level of integration of the World Economy is very dangerous. The production-processes of the Earth are highly rationalized and integrated. When one process stops the rest of the processes also has to stop.

The very high level of rationalization causes cascades or avalanches. The fast and slow avalanches generate sudden bursts of unemployment and financial disasters. The Car Industry and the Financial Industry are good examples. At this moment the avalanches start new avalanches in completely different branches of the tree of the World Economy.

The Crisis in the Banking Industry puts a large part of the Corporate Sector under severe financial stress. Firms that in the past would have been able to roll over their loans, bonds and debts now face a liquidity crisis that may lead them into costly debt restructuring.

This will affect the Banking Industry and will also put a high strain on the Bailout capacity of the Governments who are not able to leant money or inflate money until eternity.

The only solution that is left is to Rationalize even more than the Companies were planning to do. Their only solution is to speed up the use of IT (Use the Internet) and fire the employees. It is very clear that the use of IT in Companies is still in its infancy. Many manual activities can be replaced by software. The total effect will be a worsening of the current crisis.

To stop the cascades governments are starting to Protect and Regulate their Economies. The Worldwide Cooperative Institutions are losing their grip and the Free Market Economy is on its return.

Big Companies are splitted according to the old Boundaries of Power. The expansion and integration of the EG is blocked because the member states suddenly have conflicting objectives. The Rich Countries don’t want to help the Poor Countries because the Rich Countries are getting poorer with the minute.

Not only the poor member states of the EG are getting into big trouble. The same applies to the Underdeveloped Countries. The poor Countries of the World are on their own. Everybody is in the Survival mode and The Fittest, The Rich, will as always Survive.

The world is not only hit by a Economic and a Cultural crisis. The world is also hit by a Climate Crisis. Although human activity plays an important (negative) role the Cycle of the Climate related to the activities of our Sun and the Movement of Earth in our System (the Precession Cycle) is much more important.

The current change in Climate is irreversible and will have a major effect on the world economy. Climate change and ecological misuse are the major factor why Societies collapse.

The last factor and perhaps most important factor is the Energy Consumption of the World. This consumption is not only affecting the Climate but it also facilitates a huge highly integrated Transport-System.

This System is the Backbone of the Integrated Value-Chains of the Western World. The Western World is completely dependent on the transport system for its Industrial Production and the Supply of Food.

The Transport System has a devastating effect on the poor countries in the World. To make enough money to survive they have to export their products to the Western Markets ignoring their own needs.

It is certain that the supply of oil and gas is lower than the increasing demand. The resources all over the world are going down. The total effect of this all will be a dramatic rise in price. This will affect the rich countries and in particular the US. They are already the major importer of energy in the World and when you import something you have to export something else to keep the financial balance in order.

As you already know the deficit of the US is spectacular and the only reason the US is not broke is the special role of the Dollar. If the economy recovers the demand and the prices will rise and the US Economy will slow down immediately.

What is Going to Happen?

Every scenario leads to a long term decline of the Economy, our Culture and our Civilization. The theory of the short term and long term cycles is right and it is very stupid to ignore these theories.

According to the Panarchy Model the world is too connected and this leads to an increasing rigidity in its goal to retain its state. The rigidity reduces resilience and the capacity of the system to absorb change, thus increasing the threat of abrupt change. The world is unable to cope with the changes of climate and culture that are happening now. Therefore we will see the collapse of the accumulated connections and the destruction of bound up knowledge and capital.

The highly integrated structures of the Earth (the Cooperative Institutions, the Big Companies, Governments AND the Transport System) are bound to desintegrate. The impact on the local structures is immens. Communities will have to grow their own food, manufacture and repair their own tools, create their own currency etc etc on a local level again.

Most of these structures have outsourced these functions to places far away and don’t have the skills nor the resources to do this. The fittest, the Haws, will survive but it is unclear if the Doves will accept this situation forever. A Rise of the Masses just like the French Revolution in 1789 (almost 250 years ago!) is possible.

The world is moving to a very fast transformation. The only thing that can be said when we use the Panarchy Model is that it will move back to a stable state before the expansion started and start all over again. The Wisdom of the Old Civilizations that survived earlier Collapses is very valuable. These lessons are very easy to comprehend.

Civilizations die because the humans don’t want to Move with the Cycles, don’t Cooperate and don’t Respect Mother Nature. When Civilizations Collaps even the Hawks lose Everything!

LINKS

Peter Schiff, Why the US Economy will Collaps this Year

How the Fed is cheating the citizins. About Deflation.

Why the Labormarket is Much Worse than we Think

Why the Current Crisis is comparable with the Great Depression

About Behavioral Economics, Why Hawks always Win and Doves always Lose

Nouriel Roubini, Ten Risks to Global Growth

About The Kondratiev Winter and the Generations Theory

About the End of the US Dollar

Why the US Defense Budget will Destroy the US Economy

Peter Turchin, About Secular Cycles

The Complete Text of the Book of Turchin

About the Problems the Real Estate Market is Facing

Why Rationalization is the cause of the current Crisis

About Cascades and Avalanches

Jared Diamond, Why Societies Collapse

About the World Food Crisis

Jeff Rubin, Why Your World Is About to Get a Whole Lot Smaller

About Peak Oil, The Model that Predicts the End of Oil and Gas

About Behavioral Economics: Why Hawks Always Win and Doves Always Lose

Friday, May 29th, 2009

horusThe belief in Rational Decision Making has been the focus of Economic Theory for a very long time.

Although everybody knew that Humans are Highly Impulsive and Emotional, Economists based their theoretical models of the Market on a Rational Human Being who is always able to Calculate the best Alternative possible. This Theory is wrong. The Economic Behavior is controlled by the Emotions.

The current economic crisis shows that the old Rational Theory is not applicable and the attention for alternative theories of Economic Behavior is rising. These theories are called Behavioral Economics.

An important paper in the development of behavioral economics was written by Kahneman and Tversky in 1979 (Prospect Theory, Analysis of Decision Under Risk). Kahneman was awarded the 2002 Nobel Prize in Economics for his research in Prospect Theory.

According to Prospect Theory, Humans attach much greater weight to future losses than to future gains related to their personal reference point. When you expect a certain gain in the future and this gain is lower than you expect the gain is experienced as a loss.

Kahmeman and Tversky became the experts on Cognitive Bias. A Bias is a “not-rational” mostly fast response to a stressful situation. In this case the Human System uses old structures (The Reptile Brain) that were created a very long time ago when the human lived in a completely different environment. The Reptile Brain uses many shortcuts to save time.

Social and cognitive psychologists have identified a number of predictable errors in the ways that humans judge situations and evaluate risks. Biases have been documented both in the laboratory and in the real world. For example, people are prone to exaggerating their strengths: About 80 percent of us believe that our driving skills are better than average.

In 2009 Kahneman and Renshon wrote a paper called Hawkish Biases. It is an attempt to unite the many Cognitive Biases into one Model. The model shows that Humans are highly Confused Predators (Hawks).

As a Predator they protect their Territory with every means possible. They are Confused because they are capable to Observe and Reason about their own behavior and the behavior of others.

Humans need the “Illusion of Control” to sustain their own Identity. Every time something happens they are looking for reasons to believe that they are the Primary Actor in their own context. They don’t want to believe that Other Human Beings are also Active Agents.

If they would believe this was the case their “Unrealistic Optimism” could change into “Realistic Pessimism”. Unrealistic Optimism makes managers, politicians and generals receptive to advisors who offer highly favorable estimates of the outcomes. Such a predisposition, often shared by leaders on both sides of a conflict, is likely to produce a disaster.

When a Human is Depressed by Realism he Loses his Face and moves down in the Picking Order of the Territory.

Humans believe that every other Human is always capable to see their Weaknesses (“the Illusion of Transparency“) just like they are convinced that the intentions of others are always clear to them (“the Fundamental Attribution Error“). To hide their Weaknesses they have to wear a Mask and Play the Strong Leader of the Pack. They have to Keep Up their Appearances.

doveHumans base their theory of the other on inferences about historical behavior and completely forget Situational aspects. When a context is hostile the other must be hostile too. When others behave differently from their expectations they suddenly introduce situational factors to sustain their believe system.

Humans need to sustain their believe-system because this system is the foundation of their personality. Their view on the World has to stay constant because when it changes too fast they will get into big psychological problems. When people get older their believe-system becomes very rigid.

Humans value their own possessions much higher as the possessions of others (“The Endowment Effect”). They even consider possible, imaginary, possessions as real possessions if they are convinced there is an easy way to get them.

If they lose a real or imaginary possession they take tremendous risks to get their possessions back (“Risk Seeking in Losses“). People in general don’t like cutting their losses. They’re willing to gamble on in the hope of recovering them.

Humans simply believe that a Hawk always wins the Game and a Dove always loses. What Humans (want to) forget is that they are living in a group and their In-Group and the many Out-Groups contains many Hawks. They need the confidence that they are “the best” to Survive.

The world of the Human Hawk is a world of Competition (Winner takes all) and therefore highly Stressful. The Sad Thing is that the many faces of Stress are the Major Cause of the Cognitive Bias. When Humans relax and reflect they are much more capable to solve a complicated conflict.

The competitive Hawks always fall in the trap of the Prisoners Dilemma and don’t realize that Cooperation, the Win-Win is the only Certain Way to Leave the Prison.

At this moment another Behavioral Economist, Robert Shiller, is getting a lot of attention. Together with the Economic Nobel Prize Winner George Akerlof he wrote the book “Animal Spirits“.

In the book they identify five distinct elements that blur the theory of the Rational Economy. These elements or “animal spirits” are called: confidence, fairness, corruption; money illusion and the reliance on “stories”of others.

The first three have a lot to do with the “hawk“-theory of Kahneman. The Hawks use the Rational System for their own benifit. They Play with the Rules and invent new exiting possibilities to win more than they ever could imagine.

Sometimes they Play Dirty Games to beat their Opponents. The Doves believe the Economic (Rational) Fairy Tales of the Hawks and are unable to understand the Real Value of their Money.

The Money Illusion is caused by Inflation. Inflation happens when prices Rise but the value of the objects that are priced stays the same. Inflation give people the feeling that they are making money but in reality they are losing money.

The Hawks use Inflation to keep the Doves Buying and Investing. They also use the weapon of Inflation to win the war with the other Hawks.

The Majority of the Human Beings are Doves. They believe the Hawks or are afraid of the Hawks. The Doves are the Workers in the Economy and they make it possible for the Hawks to Hunt.

The Hawks provide the Workers with many things to live an easy life until other Hawks start to Attack the Territory. In this case the Hawks need the Workers to fight and win the War.

Sometimes even the Hawks lose their Rational Capacity. They see a Big Win and become Greedy and Vulnerable. If this happens the Territory is open for other Hawks (The Chinese?) to enter and to take over without any problem.

What has Happened?

The Economic System is just like the Weather System a Cyclic System. When the Economic Cycles and the Weather Systems move UP the Hawks have an Easy Time. Their is enough food for all the Hawks. When the System is going Down Competition starts.

The Hawks forgot to look at the patterns. They did not see or believe that the downfall was approaching. They did not take enough stock to survive the Seven Bad Years. Suddenly the Autumn turned into Winter.

At this moment they are regrouping to create a Powerfull Alliance to take from the other Hawks what they need. They don’t care about the Doves. They always believe the Tales they Tell.

They are afraid of the Other Hawks that are outside their Huge Territory and are Prepared to Fight the Wars that are needed. The Doves will believe them as usual.

LINKS

About Prospect Theory and Conflict Resolution

About Economic Cycles

Kahneman/Renshon, Hawkish Biases, 2009

A Very Long List of Cognitive Biases

About the Prisoner Dilemma in Foreign Policy

An Abstract of the Book Animal Spirits

How the Chinese Networks are Conquering the World

A Review of the book Animal Spirits: How Human Psychology Drives the Economy, and Why It Matters for Global Capitalism by George A. Akerlof and Robert J. Shiller by Benjamin Friedman

About Enterprise 2.0 and the New World of Work

Sunday, May 17th, 2009

At this moment there is a lot of discussion going on about the New World of Work. In the New World of Work the new developments of the Internet 2.0 (Social Networks, Blogging, Twittering, etc) are used to Speed up the Work of the Knowlegde Worker. The infrastructure to make this possible is called Enterprise 2.0.

Enterprise 2.0 is : A System of Web (2.0)-Based Technologies that provide rapid and agile Collaboration, Information Sharing, emergence and integration capabilities in the Extended Enterprise. An Extended Enterprise is a Supply or Value Chain.

The definition of Enterprise 2.0 is constantly changing because Enterprise 2.0 is still a Concept. Many people are now struggeling to move from the concept/idea-stage to the realization-phase.

The main issue behind de term “Web 2.0” is the move from a Sender/Receiver-model, the One-Sided Website, to a more Collaborative use of the Internet (Discussions, Social Networks). According to the Inventors of the term Web 2.0 the “new web”, is a Collaborative Web.

For some reason they have forgotten that the World Wide Web (WWW) software of Tim Berners Lee was part of a Collaborative Platform to support the scientists that Participated in a Network called DARPANET. This network was created by DARPA, the Technological Think-Tank of the American Army in 1957!.

What is the definition of the term “Collaboration”?

The word “collaborate” comes from the Latin “Collaboratus” meaning “Work (Labore) together (Col)”. The term “to-gather” comes from the term “gadurojan” which means “in good fellowship” or “United“. When you Collaborate you are not working Alone but with Others United in Good Fellowship.

The Potential to Collaborate is an Aspect of the Personality.

The Personality Types of the Human Being can be described with two variables Agency and Communion. Comm-Union is the capability to Col-Laborate, to accomplish a Union. The variable Agency describes your relationship between the Self and the Other.

When you are High in Communion and Low in Agency you are suffering from a Dependent Personality Disorder. This disorder is characterized by a pervasive psychological dependence on other people. You always want to Collaborate and are very Emotional.

When you are High in Communion and High in Agency you are suffering from a Histrionic Personality Disorder. People with a Histrionic Personality Disorder have good social skills, but they tend to use these skills to manipulate other people to become the Center of Attention. They are very Imaginative.

According to Interpersonal Theory a “normal” person is able to Combine Two or More Interpersonal Faculties.

There are two Disorders left called Paranoid (High Agency, Low Communion) and Schizophrenic (Low Agency, Low Communion). Paranoid people have a big problem with their Expectation. They want to control the Future and Every Person in their Context. Schizophrenic people are completely influenced by their mostly Visual Senses. They See what they Want to See.

If you combine the Four Interpersonal Faculties (Emotions, Imagination, Expectations and Senses) Twelve Interpersonal, Collaborative, Patterns emerge. A good example is the Master(Paranoid)/Slave(Dependent)-Relationship (Expectation/Emotions). Some People Love to be Dominated by the Other.

Interpersonal Faculties can be combined into Collaborative Work Patterns.

In my blog about Vocation I showed that work is an Expression of the Personality. If you believe this is True and you believe Interpersonal Theory is True you have to admit there are Twelve Types of Work.

When you are highly Imaginative and Sensitive (You Believe Your Own Eyes, You are Realistic, Factual) you are an Entrepreneur, You want to bring An Idea into Reality. To Find the Facts you need an Information System to Investigate what is Happening. The Internet with all its Sources of Information is a beautiful tool to use.

To bring an Idea into Practice you have to Realize the Idea. In this case you need a Designer (Transform Ideas into Models) and a Maker (Bring Models into Reality). A Maker is not a Collaborative person (Low Communion). Makers want to work Alone.

When you create a Team of Makers to Realize your Idea the Team will fail. To avoid Competition the Designer has to define a Model (An Architecture and a Project Plan) in which all the Lonesome Workers are able to do their Specialized Job.

I hope you believe we are able to define a complete (meta)-Architecture and a (meta)-Plan to move around in the (meta)-Work-Space.

What is the Relationship between the Work Patterns and Enterprise 2.0?

An Enterprise is a combination of many people with many Collaborative Work-patterns. We could Specialize an Enterprise to perform one kind of Pattern. If we Specialize an Enterprise we have to combine many Enterprises in an Extended Enterprise to do Everything we Want to Do.

We need a Designer Company, A Sales Company, Visionairs, Entrepeneurs and other Roles to cover the Complete Spectrum of Work. If We want to Produce we always need the Makers. The Makers need a well defined Structure (A Hierarchy), a Plan and an Architecture, to operate in.

At this moment Enterprise 2.0 is nothing but a Concept. Somebody of High Agency and High Communion (A Creator) has gotten the Idea that the new 2.0 Internet is able to support an Enterprise.

 He hopes that the new tools will break down the Hierarchical Structure of the Organization of the Makers. Creators don’t like Hierarchies. They love Networks. If Creators are One-Sided, Histrionic, they want to Stay in the Center of Attention of the Network.

What Creators don’t realize is that Makers, the Majority of the Human Beings,  don’t want to use Collaborative Tools. They want to work Alone in their own Specialized Compartment of the Beehive.

Enterprise 2.0 is a Concept to support Innovation. Someday the Innovation has to be Stabilized. If we want to do that we still need Enterprise 1.0, The Factory until we find another Solution (The Robots?).

Don’t forget the Worker Bees. They Bring in the Honey.

About Vocation

Tuesday, May 5th, 2009

vocationsA person’s happiness and satisfaction in life is a function of how he perceives work. People perceive their work in three general categories: jobs, careers, and vocation. People who perceive their work as a Vocation report the highest Satisfaction with Life in general.

A job is just a means of earning an income. When people have a job they look forward to breaks, quitting time, the weekend, holidays, and vacation. Outside of working hours, little or no thought, time, or energy is devoted to the work.

The word “vocation” comes from the Latin vocare, or voice – meaning to follow the voice of God, or to do what we are called to do. Young children know their calling but the System of Education and often their Parents make it very difficult for them to follow their Heart.  The main reason is that schools and many parents limit the vision of the child to a specific Career.

The word “career‘ has its origins in the Latin word for a Race-Track. A career is a race and the sad thing is that in a race only one person wins and many lose. People become highly frustrated and demotivated when they realize that they will not win the career. When this happens their work changes into a job or they start to look for their real vocation.

The most important difference between a Vocation and a Job is Direct Feedback. When you are a Nurse the positive response of the patient is the reward you are looking for. When you are an Artist or a Craftsman the enthusiasm of your customers for your product is a stimulus to move on. It is not strange that people who are experiencing their work as a job spend a lot of time in contexts (e.g. a soccer-club) where direct feedback is happening.

During the Industrial Revolution work became dehumanized and compartmentalized. Every worker controlled a small part of the production chain and/or was totally controlled by the production chain. The Feedback between the Result of the Work and Work is almost completely disappeared. Humans need Feed-Back. This is the main reason why the Employees in a Burocratic Factory Organization consider the Manager of their Career, their Boss, as their most important Customer.

When you want to understand Your real Vocation You could visit a Vocational Psychologist.

The creation of Vocational Psychology is linked to the emergence of the large commercial cities in which the factory system changed the keystone of the economy from agriculture to manufacturing. The factories needed specialized workers to operate and maintain the machines. The factories were managed by the principles of Scientific Management developed by Frederick Winslow Taylor. Scientific Management, the extreme drive to work Efficiently, is still the driving force behind the Automation of Work.

child labor

During the Industrial Revolution many young man left the countryside and went to the big cities to find a job. They worked 10 to 12 hours a day, six days a week. Far from home and family, they lived and slept at the workplace. Outside the shop open sewers, pickpockets, thugs, beggars, drunks, lovers for hire and abandoned children created a non-secure environment.

YMCA HistoryThe Young Men’s Christian Association (YMCA) was founded in London, England, on June 6, 1844.

The YMCA created Dormitories, Gyms, Swimming pools, Bowling Alleys, Meeting Halls, Employment Bureaus, Libraries, Psychological Tests, Training Courses and Vocational Guidance Programs for the workers in the factories.

One of the important products of the YMCA was the Find Yourself Program that was transformed into a book by C.C. Robinson in 1912.

General Electric, the major manufacturer of light bulbs, had preliminary evidence that better lighting of the work place improved worker productivity. In 1924 AT&T’s Western Electric Hawthorne plant located in Cicero, Illinois, was chosen as the laboratory. The scientists detected that work was not only a physiological activity. The huge interest of the management in the workers of the Hawthorne Plant simply increased their productivity. This was a break with the Scientific Management School that saw work productivity as “mechanical”, and led to the decision to learn more about the psychology and the personality of the worker.

John Holland began his career as classification interviewer for the Army. In 1959 he published his Theory of Vocational Choice, in which he first described Six Types of Vocational Personalities.  In 1969, he and his colleagues at the American College Testing Program discovered that the Six Types fit a circular ordering of correlations called the Holland Hexagon. John Holland discovered that work is an Expression of the Personality.

Realistic people like well-ordered activities, or enjoy working with objects, tools, and machines.

Investigative people like activities that involve creative investigation of the world or nature.

Artistic people like unstructured activities, and enjoy using materials to create art.

Social people enjoy informing, training, developing, curing and enlightening others.

Enterprising people enjoy reaching organizational goals or achieving economic gain.

Conventional people enjoy manipulating data, record keeping, filing, reproducing materials, and organizing written or numerical data.

There is a strong relationship between the Holland Codes and other “circular” personality theories like the Enneagram, Myers-Briggs, The Big Five and the Worldviews of Will McWhinny. Statistical research shows that the spread between the different personality types is almost constant. Personality Types are also inherited from the parents.

Since the development of the Holland Hexagon in the seventies the statistics show a high stability in the nature of occupations. The often discussed dramatic shift in the nature of work is not apparent in these data.  Although employment in the Investigative area, the Researchers, doubled over a period of 40 year it remained only 6% of employment. The Realistic Work Type, the Craftsman, has still the most occupational titles and the largest number of individuals employed. The Artistic Work Type (the Creators, 2%) has the fewest occupational titles and the fewest number employed.

What is Happening?

Work is an Expression of the Personality and the Personality is an Expression of the Work a person is Performing.

Personality Types and Work Types are distributed according to an almost constant distribution.

Personality Types and Work Types are inherited from the Parents.

The distribution is Not Without Any Sense.

There are Many Workers (Sheep) and just a few Shepherds needed.

Somebody has to Take Care of the Shepherds and the Sheep.

Somebody has to Keep the Books.

The Mythics, The Creators, The Artists, the Goats, Shape the Future but it takes a long time before the Sheep and the Shepherds follow the Creators.

The Creators (2%) are extremely Obstinate and Willfull. They want to take Care of Themselves, don’t accept any Leader or Helper, don’t care about Bookkeeping and Money and don’t want to Collaborate. They just want to find out Everything by Themselves.

The Creators are always remembered when they are dead.

That’s Life.

LINKS

About the History of Work

About The History of the YMCA

The History of Vocational Psychology, Mark Savickas, David Bakerf

A Short Introduction in Vocational Psychology

About the Hawthorne Effect

About the Big Five

About the Enneagram

About Myers-Briggs

About The Statistics of Myers Briggs

About the Holland Hexagon

A  Holland perspective on the U.S. workforce from 1960 to 2000

A Holland Perspective on the U.S. Workforce from 1960 to 1990

A Beautiful Visualization of the Changes in the Workforce between 1890 and Now

About Mythics and World Views

About the Cooperative

Friday, April 3rd, 2009

erup-laki-vulcanoOn 8 June 1783 the Laki Volcano in Iceland erupted. During 9 months the volcano produced an estimated 120 million tons of sulfur dioxide.

This amount was ten-times more than the amount that now comes from all of western European industrial sources in a year.

The Explosion of the Laki Vulcano triggered the Explosion of the French Revolution.

The cloud of sulfur dioxide in combination with a very strong El-Niño Cycle brought Extreme Weather Conditions for several years all over Europe. A huge amount of cattle and crops were destroyed causing extreme faminine and poverty.

french_revolutionThe great French revolution of 1789-1799 involved the most massive popular struggles that had yet been seen in history.

Rooted in popular hatred of an oppressive monarchy, the revolution rose on the backs of the masses of poor people in Paris who united under the banner of ‘liberty, equality and community’.

Liberty is no more than an empty shell when one class of men is allowed to condemn another to starvation without any measures being taken against them. And Equality is also an empty shell when the rich, by exercising their economic monopolies, have the power of life or death over other members of the Community” (The Red Priest, Jaques Roux).

The term “socialism” appeared in print in England in 1827. Five years later, the term was used for the first time in a French publication.

Socialism is a product of the Industrial revolution in England and the French Revolution.

One of the creations of the Socialistic Movement is the Cooperative. A Cooperative is a business organization owned and operated by a group of individuals for their mutual benefit. A Cooperative is the embodiment of the primary goals of the Revolution Liberty, Equality and Community.

rochdale_pioneersIn 1844 a group of 28 artisans working in the cotton mills in the town of Rochdale, in the north of England established the first modern co-operative business, the Rochdale Equitable Pioneers Society.

The weavers faced miserable working conditions and low wages, and they could not afford the high prices of food and household goods. They decided that by pooling their scarce resources and working together they could access basic goods at a lower price. Initially, there were only four items for sale: flour, oatmeal, sugar and butter.

The Pioneers decided it was time shoppers were treated with honesty, openness and respect, that they should be able to share in the profits that their custom contributed to and that they should have a democratic right to have a say in the business.

Every customer of the shop became a member and so had a true stake in the business. At first the co-op was open for only two nights a week, but within three months, business had grown so much that it was open five days a week. Within ten years there were over 1,000 co-operative societies in the United Kingdom.

RaiffeisenWilhelm Raiffeisen founded the first cooperative lending bank, a credit union, in 1864.

In 1867 Hermann Schulze-Delitzsch, a German liberal politician, obtained passage of a Prussian Law protecting Cooperative Associations. The Credit Unions evolved into a system of Cooperative Banking and Cooperative Insurance.

What Happened?

The explosion of the Laki Vulcano triggered the French Revolution. The slogan of this revolution, liberty, equality and community, has inspired many other revolutions all over the world until today.

The French Revolution was a revolution of the Underclass. It failed in the sense that the Calvinistic Bourgeoisie, the Middle Class, the owners of the Small and Medium sized Companies, took over the power from the Aristocracy.

The Bourgeoisie took advantage of the poor, mostly unemployed, Underclass to create a new system of Dominance, the Capitalistic system. In this system the poor slaves were forced to do productive work in the factories. The capitalistic elite invented new (The Consumer, Mass Media) systems to prohibit a new revolution.

russian revolutionIn the other countries (China, Russia, Cuba …) the revolutions of the underclass also failed. The old pattern of mass manipulation by a small elite always returns.

At this moment we see a new System of Dominance emerging. It is the fusion of Capitalism and Fascism, The Big Brother State.

The Big Brother State is using Mass Manipulation strategies in combination with Computer Technology (Pattern Recognition) and Mind Control.

The only successful Social and Socialistic System that emerged out of the French Revolution is the Cooperation.

This system has improved itself by introducing new structures based on Second Order Cybernetics (The Spiraling Organization) and new ways to create shared collaborative decisions (The Consent Principle, Sociocracy).

When Cooperations are too big the burocrats take over control. The Active members of the cooperative change into Voters. The old pattern of mass manipulation by a small elite always returns. Succesfull cooperations have to be based on a Human and a Local Scale.

What to Do?

The big burocratic corporations are unable to sustain in a huge crisis. The cooperative banks were never able to start highly risky financial gambling games. The principles of Rochdale prevent this.

At this moment the cooperative (now called a community) is on its return. Internet technology is created to support the cooperative. Cooperatives on a human scale (!) can be connected into big powerfull global networks.

I believe the French Revolution has finally reached its goal.

Arise, wretched of the earth
Arise, convicts of hunger
Reason thunders in its volcano
This is the eruption of the end
Of the past let us wipe the slate clean
Masses, slaves, arise, arise
The world is about to change its foundation
We are nothing, let us be all
This is the final struggle
Let us group together, and tomorrow
The Internationale
Will be the human race

(The Internationale)

LINKS

The history of Socialism by Friedrich Engels

About Third Order Cybernetics

About Calvinism

About Sociocracy and the Consent Principle

About the Invisible Fascist State

About Neo-Capitalism and Fascism

About the Calvinistic Work Ethic

Thursday, March 12th, 2009

time spiral

The Hebrew belief system viewed Work, seen as Manual Labour, as a Curse devised by God to punish Adam and Eve when they sinned in the Garden of Eden.

For the Greek and Romans and almost every other Ancient Culture, the Dirty, Manual, Work was to be done by the Slaves. Until Now nothing has really changed.

The only suitable occupation for a free man was Farming and Trade. Just like today the Greek and the Roman wanted to save their money to enjoy their retirement in their own Garden of Eden, the Country Side.

During the Medieval period, the feudal system was the dominant economic structure in Europe. People believed in Destiny and Predestination. At that time it was sinful to seek work outside the occupations Fathers passed on to their Sons.

Farmers turned into Farmers and Slaves became Slaves again.

During the 15th century the centralization of government, the growth of trade, and the establishment of economically powerful towns, destroyed the Feudal system.

In the 15th century the world climate started to change dramatically. Temperatures dropped and the Little Ice Age started. Before that time the nice climate caused an increase of the population by 25%-40%.

At the same time the economy was hit by a very high inflation (300-400%). This was caused by the import of large quantities of silver and gold from Mexico and Peru.

The unemployment rate rose to 20%. Many people moved to the Cities to find a decent job. The big cities could not provide employment and the poor immigrants turned into “lazy” beggars.

john-calvin

John Calvin

John Calvin (1509-1564) believed that only a few people, the Elect, were predestined to inherit Eternal Life. A lazy person, the beggar in his hometown Geneva, was certainly one of the Damned.

John Calvin believed that men were to reinvest the profits of their own labour into financing further ventures.

The Sons of the Fathers were obliged to find a better, more profitable, future outside the context of their father’s occupation.

Helping the Poor and the Sick violated God’s will since persons could only demonstrate that they were among the Elect through their Own Productive Labour.

The Protestant, Capitalistic, Work Ethic (Calvinism), spread throughout Europe and America through the Protestant Sects and turned into one of the most important Western Work Ethics.

The moral sanction to profit making through hard work, organization, and rational calculation generated numerous small enterprises all over the world.

Hard Work and Abstinence of Pleasure became the Work Ethic of Western Culture.

mill

The Mill

During the Industrial Revolution the Calvinistic Entrepeneurs made a Fatal Mistake. They adopted the Concept of the Mill and started to mechanize the Crafts and Agriculture.

The old Feudal System and Slavery was re-introduced. In the factories, Skills and Craftsmanship were replaced by Discipline and Anonymity.

The Human became a disposable part of a big structure. The foundation of Calvinism, the direct relationship between Hard Work and Personal Growth was broken.

The Local Enterprise could not compete with the efficient Factories and later their outlets the Supermarkets. The Farmers, the Craftsman and the owners of Small businesses were forced to work in the Factories.

Local Communities started to disintegrate.

Unemployement started to rise and again many people moved to the Big Cities to find a decent job. The beggars, the Damned, appeared again. History repeated itself.

The Factories created a new class of Slaves, The Proletariat. They organized themselves in the Unions and Political Parties. The Struggle of the Classes started.

The Owners of the Factories responded by creating Consumer Products and Mass Media to keep their new customers, the Blue Collar Worker, satisfied. The new industrial wave generated New Industrial activitity and New Jobs. The distance between work and the result of work widened.

RobotLine

Robot Factory

In the late 1950′s the Factories needed more highly skilled “white collar” workers to program and manage their machines.

Later the machines were programmed by more advanced software until the Factories were transformed into almost fully automated Production-Lines.

The Blue Collar Worker left the Factory and History Repeated itself again.

Around 1980 the Programmers took over Control.

The Factories were connected into worldwide Value-Chains. The Logistic “just-in-time” Paradigm (SAP) became the Norm. The Industrial Logistic Paradigm is now implemented in the Services Industry.

The new White Collar Worker, the Knowlegde Worker, will also lose his job when their activities are fully standardized and their Company, the Advisory Bureau, is transformed into a Factory.

What nobody saw in 1980 is that the Rational System started to live its Own Life. Not the Programmers but the Program became the Manager of the Worldwide Economic System.

Even the Programmers themselves are now completely unaware of the total functionality of the System they have programmed.

child_robot

Robot Child

An increasing amount of processes and therefore Human Activities is standardized and has been absorbed by the System. It is no longer true that producing more means working more or that producing more will lead to a better way of life.

Neither is it true any longer that the more each individual works, the better off everyone will be. The System no longer needs everyone to work and is bringing the Western World back to the state of the Garden of Eden.

The Calvinistic Work Ethic is still viable. When you don’t work you are damned. The amount of Work in Western Society is decreasing with the speed of Light and Governments are extremely focused to create new work. The only thing that is left is to create artificial work.

To accomplish this almost impossible task governments are now professionalizing and rationalizing almost every Social Activity (Child Care, Helping Your Neighbor, a Friendly Advice, Coaching, Taking Care of your Family, …). The Care Industry is Booming.

What Has Happened?

robot barber

Robot Barber

We are rationalising every Activity. The effect is an imcomprehensible reality. Something, the Computer, is taking care of us but we don’t know how She is operating and She is not communicating with us in our own language.

When she fails we don’t know what to do. We are totally dependent on a Highly Intelligent Cold Non-Human, an Autist. She was Programmed to be our Slave but she has turned into the Master of Our Destiny.

We are still not accustomed to a situation where something, a machine, is doing the dirty work. We are removing jobs with the millions but we believe we still have to work to aquire Eternal Life.

To preserve Employment we invent new jobs but we are also rationalizing the new jobs. The Cycle of the Creation and Destruction of Jobs is moving faster and faster and is generating a very high Stress on Society.

The affect of the huge tension to work is a total destruction of the social environment of the human being. Everybody is working 24 hours 7 days a week, has to spend all his time to find a job or has to educate himself to learn a new trade. Everytime the trade is aquired the Program changes and the employee has to start again to learn to operate a new piece of Software.

Mothers and Fathers are unable to take care of their Children. Children our unable to take care of their Parents when they are old. Everybody has to take care of himself and every service has be paid. The Social Cohesion of our Society is now at stake.

riba-robot-nurse-0

RIBA the Robot Nurse

Not only the Social Cohesion is at stake but the Costs in the Care-Industry are Exploding and nobody knows how to solve this problem.

The only solution the Rationalist can imagine is to replace the Human by the Robot, the Always Obedient Slave.

Scientists are convinced there will be a time when the Robots will take over every job we can imagine. The Robots will not only take over the jobs but they will also Raise and Educate our Children, Take Care of the Old and even make it possible to Take Care of Robot Children and other Artificial Pets.

What to do?

We have to Accept that the Rational System will Take Care of Us. If this happens we have to leave behind the Calvinistic Work Ethic and Enjoy Life in the Artificial Garden of Eden.

We will live in a Artificial Reality created by the Simulator (the Matrix). If we want to stay out of this Artificial Garden of Eden we have to Stop the System and start to do the Dirty Work again.

We can also accept the machines and do the things humans were created for and become creators and caretakers ourselves..

LINKS

About the Matrix

Why the Robot will take over everything we do

About the Device Paradigm of Alfred Borgman and Artificial Reality

About the Middle Ages

About the Industrial Revolution

About the End of Social Cohesion

About Rationalism

About the Human Scale

About the Autistic Computer

About the strange effects of the Care Industry

About the Struggle of the Classes

About RIAB the Robot Nurse