There is a lot of buzz around “Industry 4.0,” “The Fourth Industrial Revolution,” and “smart factories.” Much of it is great, so, before we get started, please take less than 5 minutes to watch this excellent video from Bosch.

Even if you don’t watch the video, I will briefly note the points in it that are relevant to this article (but, seriously, watch the video).

• People are at the center.
• This will not change.
• People want more choices.
• People want more personalization.

In response to those perceptions about people and their needs, Industry 4.0:

• can adapt quickly in a changing world.
• provides connectivity across companies.
• utilizes data mobility and virtual design.
• listens to preferences to define how the factory will be assembled
• is composed of modular production units which are autonomous but also trainable.
• monitors the entire value chain in the “Internet of Things” (IoT) cloud.

In other “Industry 4.0,” “The Fourth Industrial Revolution,” and “smart factories” resources, we find similar revelations. The Internet of Things will be self-describing; value-chains will auto-update, and networks of sensors will enable production systems to be aware of themselves and their components at all times.

Why Industry 4.0 Matters

So, if the promise of Industry 4.0 is legitimate, then we should end up with happier people because of better matching between their preferences and their consumption options. This is certainly not terrible, but it doesn’t really address the questions surrounding:

• too much production
• too many people
• too many choices

My belief is that the reason for this oversight, apparent in much of the Industry 4.0 material, is that all of it originates from and is produced within an outmoded economic context. In other words, it attempts to fit all of these amazing new changes into an old economic paradigm rather than ask how these new technologies and connectivity resonate with, and in fact drive, a new economic paradigm.

In other words, the real revolutionary potential for Industry 4.0 is not that can improve efficiency in the old paradigm, but that it can do something radically new.

I believe that Industry 4.0 can (and should) play a key role in solving the economic crises of late capitalism, and in turn, solve climate change, pollution, poverty, and inequality, by changing economics at its base.

Here’s how.

The Economics of Over-Production and Demand

First, a quick flashback:

1. The Economy is driven by a production-to-consumption feedback loop, called supply and demand.
2. The Market is where consumers exercise their preferences to provide the feedback that producers need.

While there is not enough room here to expound all of the features of the 20th century global economy, there are a few of relevance. Notably, the economy exists in a state of perpetual overproduction. This overproduction exists and is supported and stimulated for a variety of systemic reasons, but reason that is useful here concerns the relation between consumer choice and options as noted in the above video.
Specifically, if consumers want choices then a key way for producers to provide those choices is to produce many variations of a particular product or product type. This means making cars of every color because the market does not know what color a particular consumer will want. It means making an endless variety of media, games, and entertainment, because the market does not know what the audience desires. (Much of the activity in 20th century economics has revolved around the problem of anticipating consumer demand and preferences.) This production/consumption ambiguity generates 2 different kinds of waste:

1. Waste that is generated during overproduction processes themselves (pollution, labor, etc.), and
2. Waste that is generated from all of the already produced things that go unconsumed (food, media, etc.).

The consequence of all of this ambiguity about consumer demand and preferences is overproduction in advance. And a key consequence of that overproduction is that it creates a necessity to artificially stimulate overconsumption in return. Furthermore, overproduction

1. consumes more resources than appropriate, generating intolerable strains on our environmental wealth, and
2. produces more waste than appropriate, generating pollution, climate change, and other global impacts.

This cycle is a vicious downward spiral, and everyone knows it, but the economic and political conversations that we see in the world are all still about how to “stimulate consumption” to “foster economic growth” and to “boost production.” This is backwards.

Make. Less. More

Meanwhile, the solution to the spiraling runaway 20th century economy is not “more more more” but “less less less.” More to the point, as my colleague Richard Adler and I agreed, we need to “Make. Less. More.”

We need to make things ourselves; we need to make less of it by making the right things; and we need to get more out of what we do make by connecting things together into shared commons.

There are two particular factors in Industry 4.0 (and in the video) that point us in the right direction.

1. The factory is composed of many smaller autonomous, trainable, production modules, and
2. The information layer is in the cloud. Global, accessible.

In other words, because of the information layer is accessible from the noosphere, the actual factory modules do not have to all be in the same place. Instead, clusters of modules involved in comprehensive sub-processes, can (in general) be spread globally, closer to their resource inputs and/or closer to where their outputs will be needed next. This doesn’t have to be just information either because physical machines occupy an “ambient commons.” So, for example, heat from one set of processes can be used to benefit elsewhere in the system. The change is learning to think ecologically.
Industry 4.0 points out the potential that we have to connect networks of smaller makers into a global web that shares information. (I have written about this global maker web in Pioneering The Thing Commons). Consequently, by capturing and resolving the ambiguity of consumer demand and preferences into a data infrastructure that is inherently portable, we can transform the what/when/where in order to make:

1. what is needed: via consumer customization which is simply the expression of consumer demand and preferences in advance, and
2. when it is needed: via on-demand production and modular flexible production
3. where it is needed: via open source peer-to-peer connections that deliver production design specifications to local production devices

The resulting economic circle of “Make. Less. More.” means less production, less consumption of resources, less waste, etc. because we create to demand on demand and at demand. This is a virtuous circle, not a downward spiral.

Industry 4.0 and the principle of “Make. Less. More.” lets us create 1) to demand (what), 2) on demand (when), and 3) at demand (where).

(This is much like putting a solar panel on a street lamp, but that exploration will have to wait for my article on The Energy Commons…)

To engage with the original please go to Make. Less. More. — Why Adaptive Production Can Save The Planet by Paul B. Hartzog

Lead image: screenshot from “Future production with Industry 4.0” from Bosch Global (see below)

The post Make. Less. More. — Why Adaptive Production Can Save The Planet appeared first on P2P Foundation.

So let’s take a look at the future of manufacturing and production, what myself and others often refer to as “maker culture.”

To envision how a future economy will function, all we have to do is apply the principles of complex systems and panarchy and see what emerges:

• Many to Many
• Peer to Peer
• Do It Ourselves

Many to Many

Many to Many means that participants in the network will not be connected to other participants in a hierarchical fashion. Instead, connections will span up and down a multiplicity of networks that operate at different scales.

Peer to Peer

Peer to Peer refers to the fact that many of the extra connectivity in the network is going to be horizontal, i.e. across networks. In other words, in order to communicate with nodes elsewhere in the network, it will not be necessary to first go up some hierarchical chain and then back down it somewhere else in the network. Many to Many means the avoidance of bureaucratic obstructions.

Do It Ourselves

Do It Ourselves means that rather than relying on large centralized institutions, a vast network of much smaller participants take on the active role of making things. This much larger community of participants is subsequently more diverse, a feature that is crucial to healthy complex systems (as Scott Page has noted in his book “The Difference: How the Power of Diversity Creates Better Groups, Firms, Schools, and Societies”).

Small Pieces, Loosely Joined

In keeping with the dynamic of “small pieces, loosely joined” (first articulated by David Weinberger), we can see how a future network will function. A large array of participants in “making” will constitute in an extended network of cooperative commons. As “small pieces” they will make less at a time, but the power of their making comes from the fact that they are “loosely joined” into a flexible decentralized cooperative network. They achieve this through communication, coordination, and what Howard Rheingold calls “technologies of cooperation.”

DGML — Design Global, Manufacture Local

Michel Bauwens and Vasilis Kostakis have a useful bit of coinage called “DGML” or “Design Global, Manufacture Local.” This dictum helps remind us that the mobility of bits is cheap, but the mobility of atoms is costly. In other words, rather than keeping the information local and making the thing, we can distribute the information and make the thing closer to where it is needed.

This is a reversal of traditional economics, about which Michel Bauwens once said (of my work on the transformation of Social Publishing):

Not “select, then publish,” but “publish, then select.”

And so for manufacturing and production we might also say:

Not “make, then distribute,” but “distribute, then make.”

Making the Thing Commons

The production of immaterial common pools is already regulated through mutual coordination…, i.e. coordination based on open and transparent signals of what is needed by the system; but physical production cannot be coordinated without similar signals…

There are two key infrastructures required for the Thing Commons.

First, there is the actual manufacturing or “making” infrastructure. This can range from larger factories, to medium sized “maker hubs”, to small personal-scale 3D printing devices. The primary empowerment of this infrastructure rests in making it easy for new entrants to join the existing network and extend and innovate the current tools and practices. Much of this exploration is already present in the global communities of “open hardware” and 3D-printing advocates.

Second, there is the information infrastructure, which (echoing Ostrom) consists of two layers of information tools: 1) information for making things, and 2) information for managing the community itself.

In practical terms, this means means building the infrastructure necessary for a healthy Thing Commons. For example, many manufacturing machines require older proprietary equipment and software which, in several cases are barely available from a rapidly disappearing cadre of developers. Often the only alternative is newer (but also proprietary) software and tools that are only available at very expensive prices, resulting in large barrier-to-entry into the market. Barriers-to-entry are the precise opposite of how to build a large scale open network.

As people like Yochai Benkler, Michel Bauwens, Eric Raymond, David Bollier, and others have shown, “commons-based peer-production” distributes and coordinates work, but also achieves efficiencies that traditional firm-based economic organization have failed to realize.

Imagine rather a global community of tinkerers, but also a global community of physical production houses, that can download the design and can produce things much more locally.

But, as complex systems scholar Stuart Kauffman has pointed out, systems change. At one level systems can adapt to be better. At another level they can improve how they adapt. And at even another level, they can adapt how they learn. All of these levels are present in a healthy making ecology.

Complex systems “explore and embrace” evolutionary pathways by allowing the parts to evolve and innovate, and then by adopting successful adaptations back into the system or organism as a whole.

Thus, the diversity of participants is acutely necessary to the future improvement of the system, which only cares about the value being brought into it by a multitude of diverse players, i.e. an “open value model”:

The open value network model abolishes the distinction between the commercial entity and the community!

What It Means For You (and/or Your Organization)

Given a picture of a future network of production and manufacturing, it becomes possible to subsequently envision various strategies for success.

The success of the Thing Commons requires (as pointed out by Nobel Economics recipient Elinor Ostrom) us to actively “govern the commons.” We have to do this on at least two levels: 1) manage the resource, 2) manage the community that uses the resource:

1. “Managing the resources” means realizing that just as your inputs are some one else’s outputs, your outputs are someone else’s inputs. There is no such thing as waste. This means that connecting to other parts of the system that can effectively utilize your “waste” is crucial. Because wealth-generating ecologies: reduce, reuse, and recycle, these processes become part of the normal operation of the network.
2. “Managing the community” means openness, transparency, and making available the rules and tools that allow for the governance of the resources and community. This refers to how decisions are made, how disagreements are resolved, and how institutional change is handled over time.

By far the largest crucial commons is the information infrastructure that fosters widespread network participation. As the success of open systems demonstrates, the route to a healthy commons is to create a network which will:

Promote Participation

This means that the system must encourage players to actively contribute to the commons. A crucial element of participation is not only contributing to the existing system but also being able to extend and innovate the network’s operations.

Prevent Depletion

This means that the rules of the system must secure the benefits of the commons for all participants, by excluding the capture of those benefits for someone’s gain at the expense of the commons. For some commons, unmanaged open-access can result in depletion, whenever inappropriate incentives interfere with the smooth operation of the commons.

The Success of Open Design

Anyone active in open source communities or in public domain science, also knows from experience that shared innovation is happening on a continuous basis in open communities.

The winning strategy then is one that I have termed “winning by playing.” The mechanism is as follows:

1. Gather the potential participants who would benefit from the reduced costs and economic sustainability that results from building shared open infrastructure.
2. Brainstorm, share, and test network designs, standards, schemas, structures, and rules, with those participants. Release early; release often. Faster cycles of exploration and adaptation equal rapid innovation.
3. Let go. An ecology is not something you can control. As Tom Malone said in “Future of Work” the goal is to “coordinate and cultivate” rather than “command and control.”

In his “New Rules for the New Economy” Wired editor Kevin Kelly said “feed the network first.” The rules of software interoperability tell us “build your API first.” Either way, the message is clear:

Whatever persons, communities, organizations, industries, firms, and/or governments (most likely all of the above) facilitate the creation and evolution of the Thing Commons will gain the opportunity to be on the ground floor in establishing key rules and practices. These front-runners will find themselves in the best position to contribute, excel, and succeed in the future economy.

Some References:

Here are more insights on all of this from Michel Bauwens, Vasilis Kostakis, and Dmytri Kleiner:

• The Emergence of Open Design and Open Manufacturing: http://www.we-magazine.net/we-volume-02/the-emergence-of-open-design-and-open-manufacturing/
• Mutual Coordination: https://wiki.p2pfoundation.net/Category:Mutual_Coordination
• Open Value Model: https://wiki.p2pfoundation.net/Open_Value_Network_Model
• Why Is Open Hardware Inherently Sustainable: https://wiki.p2pfoundation.net/Why_is_Open_Hardware_Inherently_Sustainable

Thanks to R. Keith Smith

To engage with the original please go to Panarchy 101: We Can Make It — Pioneering the Thing Commons by Paul B. Hartzog

The post Panarchy 101: We Can Make It — Pioneering the Thing Commons appeared first on P2P Foundation.

This article by PSFK Labs describes how those involved in ‘Maker Culture’ are trying to steer a path through the murky waters of IP and ensure that there is benefit for all concerned – my reservation with the model of only allowing designs to be printed once is that although it protects the right of the designer to earn value from their work, it does so by imposing an ‘artificial scarcity’ where none is really called for – ultimately I would prefer designs to be shared freely in a Commons approach, possibly in conjunction with something like the Peer Production Licence so that capitalist entities not contributing to the Commons have to pay IP rent, and thus ensuring a flow of value back to the creators of the designs.

The key phrase from the article seems to be ‘Within the world of digital design, it can be hard to define where ownership begins and ends‘ – this is surely one of the pressing dilemmas of our age and if we get it right we can ensure a future that is more abundant than what we have known in the recent past.

An emerging set of platforms and services are making it easier for inventors to navigate the complex landscape of copyright and bring their ideas to market.

Between 2003 and 2008, the Recording Industry Association of America (RIAA) filed, threatened or settled more than 30,000 cases against individuals who used peer-to-peer (P2P) networks to share music. It was an unprecedented legal campaign designed to protect copyrights and intimidate into submission anyone who might be tempted to upload or download material without giving the industry its due.

And while music lovers and open-Internet advocates screamed, the RIAA argued that it was the only way to ensure that individual artists and their recording labels could survive. Since then, as society has become increasingly digitized, the balance of democratization and rights protection has become harder and harder to strike.

To see this struggle in action, look no further than the exploding industry around 3D printing and design marketplaces like Shapeways and Sculpteo. Catherine Jewell of the World Intellectual Property Organization (WIPO) wrote last year, “Ensuring that incentives and rewards are in place for those who invest in new ideas without stifling innovation and openness in the use of online designs will be a key challenge for IP policymakers going forward. Mechanisms that facilitate the licensing and legitimate sharing of design files will play a major role in meeting this challenge.”

The urgency of finding the right mechanisms is underscored by the fact that companies spent $13 billion last year dealing with assertions of copyright infringement. Fortunately for makers on both sides of the issue, there are a number of innovations emerging that will allow innovators to fully focus on their craft without having to worry about losing ownership of their work or infringing on the intellectual property of others.

We’ve called this raft of new tools ‘Gated IP’ and this week, we take a closer look at three examples of the trend.

Continue reading…

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