The Blockchain Ecosystem: A Decentralized Enterprise

It’s hard to ignore how the blockchain ecosystem has led to the progressive decentralization of companies in an increasingly remote and global environment. Jonathan Covey of Talent Tech Labs spoke with Bryan Peters, co-founder of Sobol.io, about the path to decentralization and necessary conditions in order to succeed. Sobol is a company that works with the new paradigms of work by helping companies apply new ways to visualize and run organizations & DAOs.

Sobol maps accountability across entire ecosystems so Teams can move fast with alignment and trust. They talk about the use of technology to visualize dynamic company organizational structures and form accountability frameworks. They also discuss how these building blocks are necessary for being able to leverage the emerging blockchain protocols of the future.

You’ve talked about Conway’s Law, which states that organizations design systems that mirror their own communication structure. What does this mean in the context of work, and how does blockchain shake things up?

Yes, the birth of the internet and the emergence of continuous software delivery created a massive shift explained by Conway’s corollary. Software developers started to change their organizational behaviors and team structures to mirror the capabilities and architecture of the software that they were working on. New models like the agile movement emerged, and teams outside software delivery started to adopt them. Unlike the old-industrial way, it was about moving fast to build things, deliver, learn, and iterate.

And so the idea here is that the blockchain is the next wave of technological evolution and the ethos of it is about decentralization. As you start to interface with that technology, you notice the blockchain developers and the ecosystems of participants mirror these decentralized technologies and begin to make decisions, collectively build, and transact value as a decentralized network of talent. And so, you have the birth of decentralized autonomous organizations (DAOs), which are incredibly open, permissionless, and dynamic in their decision-making. These talent networks are extremely non-hierarchical.

Read through the conversation Jonathan Covey of @TalentTechLabs had with @BryanPetes of @TeamSobol regarding the use of #Blockchain, the need for decentralization, and the #FutureOfWork: Share on X

We’re finding a whole new wave of ways for talent to engage with these types of organizations where the talent starts to look like they are self-sovereign. They’re a node on the network of decentralized organizations and have the right to decide what project(s) to participate in or exit. We’re watching these new organizational patterns, and the ways in which talent is attracted and engaged match the way blockchain computing nodes make decisions on the blockchain of which blocks are valid and which network they’ll connect to.

So Sobol describes itself as an Organizational Accountability Platform. Tell us how it fits into this picture and what product and services you’re bringing to market.

So Sobol started in 2017 with a firm belief that DAOs and blockchains were going to reshape how we work. Since then, blockchain, like any new technology, has gone through hype cycles and troughs of disillusionment. So in response to the 2018 downturn in the space, we put blockchain on pause and focused on solving problems that all organizations face. We built a platform that helps any organization visualize its accountability structure. Sobol maps accountability beyond the normal org chart and reporting lines. The fact is that the Ciscos, Spotifys, and other large-scale organizations are already on a path to decentralization and remote work, accelerated by COVID. Decisions are made by people wearing multiple hats, teams are cross-functional, some are product-focused, but accountability is unclear.

To solve this, you need to map the relationships between people, the roles they’re playing in the teams they’re supporting, and the objectives that drive the whole system. This map needs to be transparent and dynamic. You need a clear picture of how teams agree to distribute and delegate decision-making…sort of GitHub for your organizational DNA. In this marketplace-like model, career pathing is less about climbing the ladder and more like building a dynamic set of roles you fill at the intersection of the business needs and your passions and edge of learning. CIOs are trying to understand how they help enable their employees to do that.

Got it. Teams are operating in an increasingly complex, decentralized way, and there’s a clear enterprise tech need to support that. What about use cases for companies emerging in the blockchain ecosystem?

Many of the same principles we just talked about apply, except far more decentralized. In the blockchain ecosystem, you’re seeing DAOs emerge where more of the community is starting to participate in the work. To confidently and trustfully start decentralizing decision-making and power structures, you need an accurate, continuously updating map of the current organization, team objectives, and the folks contributing. Current solutions for startups like Teams, Slack, or Discord are hard to navigate as the org grows.

In addition to the visualization, another piece is having agreed methods of working, like a handbook for how we do meetings, make decisions, groom the roadmap. You can make operational components very explicit, which is great for onboarding and continuous accountability. And if you don’t like it, there’s a mechanism to change these “agreement” objects using the DAO governance mechanisms.

In more decentralized models, you start to notice collaboration with other organizations and shared resources. Having a way to dynamically form agreements is important as autonomous and independent contracting entities that transact with one another in tokens form within organizations.

And so those are the building blocks. It doesn’t matter whether you’re a Fortune 100 company or a DAO. You need a clear map of the org so talent can easily navigate into roles where they can contribute relative to the goals of the organization and a way to keep track of it all as it rapidly changes.

Tell us about your views on introducing blockchain protocols into the enterprise?

Here’s how we’ve approached it. In the blockchain ecosystem, the protocols themselves support trusted transactions of value (with no intermediary). Many work-related protocols are emerging upon blockchains to support use cases like payroll, governance, identity, fundraising, contracting, decentralized finance, treasury management, etc. If we’re not going to have managers and a hierarchy that’s beholden to the organization via fiduciary duties, then you need smart contracts you can trust to execute the decisions of the organization. That’s where the blockchain really shines in the decentralized future of work.

Jonathan Covey of @TalentTechLabs sat down with @BryanPetes of @TeamSobol to discuss #Blockchain, the need for decentralization, and the #FutureOfWork in our latest #TrendsReport: Share on X

Sobol’s strategy is to be really good at mapping out your company or DAO and be the premium user interface that plugs into all these emerging protocols on the back-end. You see, users and buyers like these protocols, but they’re hopping around them, and the user experience feels very fractured. You’re already starting to see consolidated user experiences emerge like boardroom.io for the governance persona. They plug into tools like Gnosis Safe for treasury management. We predict a new category forming for joining and navigating a DAO. A global layer where a person can see their place in the DAOs they contribute to, a view into the entire structure and operations of those DAOs, and easily find projects and people to work with. So today, we see Sobol integrating into things like CRM, Trello, Atlassian, Slack, and other operational tools to capture great data. Still, we’re rapidly transitioning to integrating with the blockchain and Web3.0 based protocols that govern and operate DAOs.

Let’s segue back to workers and the future of work. In the last 10 years, there’s been so much hype on the gig economy from software players who materially different impact claim the workforce will radically shift to freelancers. The stats don’t support it. Do you think blockchain will have a material impact on free and independent workers?

Yes, I do think blockchain will surmount shortcomings that have existed. For example, one hurdle to going fully independent is the risk of finding your own work in a hyper-competitive, commoditized environment. If you don’t have the passion or skill set to do the business development and forge a channel in the market, it may not be worth the freedom and independence. So most people are going to stick with the incumbent model.

What we need to do is have all the things we love about traditional employment. This exists in the DAO world, but we need to move faster. We need the infrastructure that supports and reduces overhead for easy onboarding, legal, payroll, tax, and benefits. The decentralized work marketplace also has to hit a tipping point of abundance. Just like the commoditized platforms (Upwork, Fiver, WorkMarket, etc.), they work really well when they find the right supply and demand mechanics.

I’d argue today that most DAOs are in the bootstrap phase. They’re using native tokens, which don’t yet have much value. It’s akin to sweating for equity at a bootstrap company and believing that we’re going to make this thing worth something in the future. That’s not accessible to everyone.

So again, it’s creating a new choice for the more entrepreneurial-minded moonlighter. DAOs are an amazing place to play, but workers struggle to transition to full-time employment in the space. DAOs need to hit a point of work abundance to be the global future of work.

It might be tough to predict…how close are we to reaching that “tipping point”?

So I spend a lot of my time in DAOs on evenings and weekends. What I’m noticing is that the struggle exists in there. When I talk to my peers in the DAOs, it’s like they’re all hunting how to get in full-time. Some have done it, but not everyone can.

And one of the big markers of when a DAO lifts off and starts “hiring” is when the liquidity and the valuation of their native token and treasuries can start to stream something that looks like a salary (in stablecoins) steadily. As DAOs reach this stability and abundance level, it helps if all the boats rise up so that it’s not just a lucky few who can move into them full time.

The last missing piece is around compliance, which projects like Opolis are focused on. Making that easy will give freelancers total optionality to float across multiple projects or be super dedicated like traditional employment.

What advice do you have for business executives? What steps can they take to prepare for decentralization?

Established, large enterprise organizations already recognize the inefficiency of command and control hierarchies and the need to be more agile. And so, I’d say executives need to acknowledge and embrace that and ask the question, how can we effectively map the way we’re working today? What’s the level of explicit and transparent knowledge that we have about our current operations versus implicit? If we wanted to further decentralize ourselves, where are the areas we’re over- centralized and being held back? Can we start to run experiments and prototypes in those areas of the business?

So my advice is to get started with where you are today and watch out for opportunities to decentralize progressively. If a CIO is on that journey, they may be lucky enough to meet up with the web 3.0 world on the same progressive journey. Then, you could form more business-to-DAO relationships and plug into these DAO-centric talent marketplaces.

And I’d also say there are some great enterprise-friendly consultants out there (like former Zappos folks with backgrounds in self-management) who can help large-scale companies adopt organizational behaviors for decentralization.

About Bryan Peters

Bryan Peters is a co-founder at Sobol.io, an app that helps Teams visualize and manage dynamic organizational accountability structures. He’s focused on answering the question: How might we transform ‘The Future of Work’ into ‘The Future of Play? His current related obsession is to explore what opportunities live at the intersection of human collaboration networks and decentralized technologies like the Ethereum blockchain.

Connect with Bryan on LinkedIn.
Follow Bryan on Twitter.

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