Mechanisims of trust building

It's eye-cathing to be told that The 21st C organisation will be small, decentralised and flat. The very opposite of the 20th C organisations that still cling on to power.  The article points to the software technology behind Bitcoin as having much greater potential applications. The individualising guarantee of uniqueness in the digital realm on which Bitcoin is built is something, it is argued, that can, in a sense, 'automate' trust by enabling people to have reasonable grounds to believe that other parties to agreements will play the part they agree to. This leads to the following scenario:

So the traditional corporate structure where investors, a board and a senior management team make the big decisions for a company might be challenged by an arrangement where groups of self-employed individuals with complementary skills and experience contract with each other to pursue a certain commercial project. The co-ordination, decision-making and operational matters usually handled by the corporate hierarchy would be managed by a combination of computer code and a diversity of individuals and organisations in return for material incentives such as an automatic share of profits. The trust required to ensure that all the contracted parties had the necessary skills and resources to fulfil their functions would be built into the very code and processes that facilitate the contracts just as conducting a transaction in bitcoin inherently provides the necessary guarantee of trustworthy payment.

What this helps us to see is that there is a good deal of many lager ceroporisations that is actually about enabling 'trust' and processing background information which is not core to the aims of the enterprise. It's probably the thing that triggers the common cry against bureaucracy: the sense that it is not very directly contributing to the core endeavours, merely supporting and even sometimes seeming to get in the way of 'actually doing'. It seems that this software solution could be the death knell for at least some administrators and middle management.

Precisely the same principles could, in fact, be applied to any area of common endeavour removing the need, for example, for hobby clubs to have an organising committee, political campaigns to have a central leadership, public services to have government appointed managers or even for social networks and search engines to have an office full of co-ordinators.

When we consider that one of the aims of a bureoucracy is to deal with processes fairly and even handedly, in fact without respect for persons, then this kind of solution is the ultimate in depersonalising administrative processes.

Of course the question is whether the programming can be up to it. I would guess that quite o lot of trial and error may need to be endured at first until blocks of programming which generally work for common kinds of joint enterprise are devised and can be called up and finessed relatively easily.

What will this do to the character of corporisations? Will it mean more smaller, leaner and shorter-lived enterprises? Will the ties so created be enough to form corporisations or will they be less than such?

At the moment I can't work out the answers, but I'll be watching out for developments.

See also article at RSA.