So for this Soundcloud post, I wanted to talk about specifically an aspect of liquid labour, the shift of information flows from a centralized design to a more decentralized, dynamic and flexible network.
I wanted to explain the feedback loop phenomenon with a bit of a focus on real-world business models and the contrast between centralized and decentralized management within companies.
So in the lecture the concept of liquid labour was explained pretty well. It’s basically the idea that in this new, digital age, labour has shifted from industrial assembly line-esque work to data and information processing unconstrained by confinement, working hours and huge hierarchical business structures.
A major contributing factor of this introduction to liquid labour is – the shift of centralized information flows brought on by the birth of the internet. We can picture this as the way in which companies deal with coordinating huge amounts of information to result in change. A really cool example of this is how a huge, multinational company is likely to run by a centralized model – where the big ceo at the top is fed information and all decisions run from him down the ladder. This is compared to an upstart small business, where information goes through a couple of workers and decisions are made quick smart. Both companies run a feedback loop, while the former is longer and slower, and the latter is much quicker.
These differing methods of managing information flows yield vastly different pros and cons. Further delving into this economic analogy in business models , the centralized management structures allow for an action to quickly run through the loop without much conflict – as all the people involved are pretty much focusing on the same thing as the ceo – and as such control of this sort of business is more tight and restricted.
- However the transactional costs of coordinating these networks are much higher, since you’re paying more for such a complex structure.
- And you’re probably going to react much slower to changes at a local or smaller scale as the feedback loop is hella long.
Compare this to a cool new small business that opened up on the corner. You’re giving more power to local employees – which means that the reaction speed for the feedback loop is much quicker. If a customer wants to know if there are more snapbacks in the warehouse out back the employee doesn’t have to check with the supervisor, or his manager, or his manager. He just opens the back door, checks and comes back in 2 minutes. The information flow is much tighter, and faster – and these sorts of information networks tend to consistently outperform centralized information networks as you’re shifting the decision making from a central person to one of the smaller employees.