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.

This article seeks to respond to an important issue that arises a lot in the conversations and spaces in which I participate. Moreover, I think it is timely and important in relation to the divisiveness made apparent by the recent election of Donald Trump to the presidency of the United States.

There is a general usage in our language (which doesn’t necessarily indicate a cognitive consensus) that cooperation and competition are opposites or mutually exclusive. More importantly, there is a conviction that competition and cooperation are somehow ontologically “real,” which is to say that they exist, i.e. that they are a property of the system being observed, rather than a property of the observer.

An alternative viewpoint, however, and one that I find crucial, is that the presence of cooperation or competition is in the eye of the beholder.

We will look at three examples:

1. Predator/Prey interactions
2. Sports
3. The Nation-State system

Predator/Prey

An example from complex systems is illustrative. Take an ecology of predators and prey with complex systems dynamics between, say, wolves, sheep, and grass. There are several competitions happening here.

• sheep compete for grass
• wolves compete to eat sheep
• sheep compete to not be eaten by wolves
• grass competes to not be eaten by sheep

However, out of this complex system we get Lotka-Volterra cycles of the rise and fall of populations. An increase in grass can feed an increase in sheep which, in turn, can feed an increase in wolves. An increase in wolves results in less sheep, which takes pressure off of the grass, but subsequently puts more pressure on the wolf population as food becomes scarce. Populations rise and fall over time, a dance across time. These dynamics have been extended to any system containing resources and consumers of those resources, such as economics. The parts of a systems are always cooperating to maintain the system as a whole in the midst of larger systems and dynamics.

Sports

Another useful example is the dynamic between sports teams in competitive sports. Certainly we are all familiar with the arena in which one sports team competes against another in a match where there is only one winner and one loser. Beneath the surface however there are other complex dynamics occurring.

The resources for both teams are not infinite: financial resources, time, attention, etc. Many resources are in scarce supply. The ecology of sports teams and individual players seeks to maintain its popularity and importance inside larger systems. Sports desires our attention; it requires our resources, and it takes actions in order to achieve those goals, e.g. to keep sponsorships alive, and to keep salaries high. Even when competing, sports teams strive to bolster and sustain the network. Even a simple chess game between friends, while seeming competitive, may serve broader goals of companionship and time spent. When we zoom out from a limited viewpoint, we can see that competitions serve cooperative ends.

The Nation-State System

Another place where competition and cooperation occur simultaneously is in the nation-state system, i.e the realm of international politics. This does not refer to competition and cooperation between states, however. Instead we are talking about a level of understanding that shows that even when states are apparently competing (even when they are at war), their activity, seen through another lens, is fundamentally one of cooperation.

A quote from Hedley Bull is instructive:

“[States’] goal [is] the preservation of the system and society of states itself. Whatever the divisions among them, modern states have been united in the belief that they are the principal actors in world politics and the chief bearers of rights and duties within it. The society of states has sought to ensure that it will remain the prevailing form of universal political organisation, in fact and in right.”

— Hedley Bull, “The Anarchical Society,” 1977, p. 16

For some scholars, this is demonstrably evident with regard to the 1936 anarchist revolution in Spain. Foreign powers, both capitalists and communists, many of whom were already in direct conflict, cooperated to eliminate the success of Spanish anarchism because it was not merely a threat to individual states themselves but, more importantly, a threat to the entire nation-state system’s validity as the dominant means of managing peoples (internally) and international order (externally).

Competition IS Cooperation: Seeing Differently

The crucial consequence of the perspective that I have attempted to illustrate above is this.

Even when we are in conflict with an opponent, there is some cooperative dynamic that is occurring by our acting in relation to that opponent.

For example, in society and politics, when social groups oppose each other with hatred and violence, there are those who benefit. The media and the arms industry supply us with both the pens AND the swords for us to keep the merry-go-round revolving. In addition, the larger system that defines the terms of participation, benefits whenever players slip themselves into predefined slots that the system knows how to handle: predator; prey.

The solution then is neither to disavow competition in favor of cooperation, nor disavow cooperation in favor of competition, but, instead, to realize that:

Competition and Cooperation have no independent existence, i.e. they are not objective properties of the world. Competition and Cooperation are called-forth into being, into the world, only as a function of the way in which we choose to observe a domain.

Consequently, the challenge for us all is to be more cognizant, open and aware, of the contexts in which competition and cooperation are highlighted by our choices. The responsibility lies squarely in ourselves.

In other words:

Competition is Cooperation: See Differently

To engage with the original please go to Competition IS Cooperation: Seeing Differently by Paul B. Hartzog

The post Competition IS Cooperation: Seeing Differently 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.

The following are the key “lenses” through which I view and discuss the ongoing transformation to panarchy. Each of these lenses provide crucial understandings and insights into facets of panarchy, but panarchy itself emerges only as a result of the interactions between all of these elements. Like all complex systems, panarchy itself is an emergent property.

• Commons
• Complex Systems & Networks
• From the Bell Curve to the Long Tail
• Plurality & Diversity
• Cooperation
• Peer Production
• Open Design

Commons

Commons are systems of shared resources. A lifetime of work by Economics Nobel Prize Recipient Elinor Ostrom reveals a plethora of case-studies with insights and strategies for governing our commons. There are many kinds of commons — ecological, social, information, and technological — but the one thing they all have in common is the need for thoughtful management in order to insure sustainability for future generations.

Complex Systems & Networks

Complex systems and networks are systems that are more than the sum of their parts. Because the parts are interconnected, dynamic relationships between the parts result in emergent properties at the system level. In complex systems “more is different.” Complex systems and networks can range from too rigid to too fluid, but the most interesting of them have mechanisms of self-organization that move them towards a robust and resilient balancing act at the “edge of chaos.”

From the Bell Curve to the Long Tail

The bell curve defines systems with normal distributions where averages are meaningful (because populations are homogenous) and “mass” dynamics are the norm. The long tail, or power law, distribution makes averages meaningless and replaces the “mass” with a plural multitude of diverse members. The transition from the bell curve to the long tail is as relevant in philosophy and culture as it is in economics and politics.

Plurality & Diversity

Plurality refers to the fact that new dynamic systems consist of many interacting parts, whereas diversity refers to the condition that exists when those parts are different. Neither plurality nor diversity is itself sufficient for panarchy, but together they provide an accurate description of the new landscape. This new “multitude” is unlike any civil polity that has existed before, and it will demand infrastructures for governance and economics that are equally unique.

Moreover, governance itself has to exhibit authority, legitimacy, and continuity. We are on the cusp of a “Greek moment” wherein we are faced with the challenge of creating new forms of governance that can be responsive to the needs and demands of a diverse and mobile “global civil society.”

Cooperation

Cooperation is responsible for everything you see around you. Civilization itself would not exist if humanity had not overcome the challenges to cooperation. Much is known about the conditions necessary for cooperation to emerge and succeed, and recently we have seen an explosion of technologies that allow for new forms of cooperation. Much of that cooperation manifests in the new economy where community currencies, smart contracts, and peer production exist in a zone of experimentation and innovation.

Peer Production

Peer production (or as Yochai Benkler terms it “commons-based peer production”) is a new form of bottom-up collaboration to fulfill economic needs and wants. The emergence of “maker” culture is predicated on the consequences of technologies of cooperation. Peer production does not have to be merely economic however. The world of peers produces information at an ever-increasing rate, and also produces new shared understandings, cultural norms, social movements, and political pressures. The new infrastructure that connects people catalyzes peer production in a feedback loop with crucial consequences for our world.

Open Design

Open design refers to the challenge of planning for an unpredictable system what futurist Rick Smyre calls “Preparing for a World that Doesn’t Exist — Yet.” But we can design for adaptability if we follow the insights from Stuart Kauffman’s investigations into evolution and biology. Namely, evolutionary process result in complex systems that maximize their own evolvability. In other words, they evolve to evolve better.
Consequently, Michel Bauwens has claimed that what we need is “an infrastructure for open everything.” This means crafting social and technological systems that are based on a diversity of open standards and are easily extensible. Such an approach insures continuous innovation as landscapes shape their inhabitants and in turn those inhabitants shape new landscapes.

Panarchy: A Multifaceted View

So, how then do these lenses combine to give us a better view of panarchy as a whole?

1. Technologies of cooperation allow human beings to collaborate in ways never before possible, i.e. 1) faster, 2) mobile, and 3) global.
2. A heightened awareness of the climate crisis and the earth as a literal ecological commons compels people to do more with less, i.e. to “make less more” to reduce the combined footprint of 7 billion people by sharing physical as well as information resources. Because technologies of cooperation are ideally suited to building global sharing mechanisms, the result is the emergence of new global commons.
3. Because these new networks are complex systems, they behave ecologically, with similar dynamics, except at faster time scales with larger global reach. In addition, understanding them requires understanding the shift from the bell curve to the long tail.
4. If we are to embrace these changes rather than retreat into an imagined idyllic past, we must embrace both plurality and diversity as core elements of a healthy future civilization. The only structure that can do so is one that operates on what I have called “The Difference Engine” and it embodies principles of open design in social, economic, technical, and political spheres.
5. That system of overlapping, interwoven, interpenetrated, diverse, cooperative networks is panarchy.

To engage with the original please go to Panarchy 101: 7 Crucial Lenses by Paul B. Hartzog

The post Panarchy 101: 7 Crucial Lenses appeared first on P2P Foundation.