I’m going to explore the idea of “double-loop” governance, with some ideas and some suggestions as to why you might want to consider this form of governance as the heart of the physical or virtual organization (or network, or corporation) you plan to start or hope to change.
Below, you will discover how a double-loop governance scheme brings the values, the vision, and the underlying assumptions of an organization into an open and transparent decision cycle. This decision process is characterized by distributed (shared) participation and control, free and informed choices, public testing of evaluations, and an ability to manage conflict on the surface of discussion threads.
Members in an organization with double-loop governance have the ability to redirect, refocus, and recommit to the values and the vision of their organization. Double-loop governance creates peers for a peer-to-peer network. Because of this, membership is well-defined, and provided with responsibilities and rewards.
Double-loop organizations tend towards meritocracies and value contributions over clout (or Klout). Because decision-making—to the level of deciding underlying assumptions—is distributed rather than top-down, double-loop organizations depend on double-loop learning (and Model II theories-in-use). Contributions to decisions and work toward goals (software code contributions, etc.) can be used to measure the value of members, and to reward their service. The vectors for acquiring merit are ideally well-described and collectively fashioned. A great example of this is StackExchange (http://stackexchange.com). Clay Shirky, in a recent talk (available at http://archive.org/details/drupalconchi_day2_keynote_clay_shirky), describes how StackExchange uses double-loop governance to engage its members. Double-loop organizations are better able to discover and reward emergent leadership and harvest the long-tail of community participation.
Much of the added value of a double-loop governed organization comes from the quality of interpersonal interactions, the extra amount of available trust, and the additional flexibility that distributed decision making provides. This value does not arrive without additional costs (which are described below). For ventures that are designed to solve a single problem and then end, these costs may not be appropriate. But for enterprises that hope to grow and flourish in today’s changing IT landscape, these costs are essential to sustaining any organization.
While notions of double-loop governance apply to various organizations, here I want to focus on virtual organizations/internet communities. These have some common features. They are created to solve a problem or problems, often problems of some real consequence. They rely on the voluntary contributions of experts. And they bridge between groups that may have diverse or divergent interests. Examples of these organizations/communities of which I am somewhat familiar (either personally or through other sources) include the W3C, Ubuntu Linux, Stack Exchange, the Open Geospatial Consortium, the Federation of Earth Science Information Partners, the National Science Digital Library, and the Digital Library for Earth System Education.
Some of these organizations are/were more successful in their governance efforts than others. Some of these examples no longer exist, in part because of their governance choices. Other authors have pointed to Apple Computer, the Valve Corporation (entertainment software makers), and Zappos (online shoe store) as good examples of culture-led corporations that use double-loop learning to pivot to new opportunities; and these provide some lessons on how double-loop management/governance can become an integral feature of a for-profit organization. The Valve Corporation Handbook for New Employees, First Edition (2012) welcomes new employees with this statement: “The company is yours to steer—toward opportunities and away from risks. You have the power to green light projects. You have the power to ship products” (p. 4). In full double-loop mode, the Handbook is also editable by employees, new and old: “This book is on the intranet, so you can edit it. Once you’ve read it, help us make it better for other new people. Suggest new sections, or change the existing ones” (p. viii).
The various examples show how spending the time and effort to become a double-loop governed organization is important for innovation, for volunteer engagement, and for sustainability (i.e., the why of double-loop governance). What follows are some thoughts on where the value of double-loop governance is found, and how to boot-strap and support double-loop governance for a new virtual organization.
It could be argued that single loop organizations and management were well suited for a time when the pace of innovation was much slower than today. The single goal of becoming more efficient in, and creating sustaining technologies for, the manufacturing of, say, automobiles or washing machines could carry a corporation for several decades. The pace of innovation within information technology now means that organizations need a new ability. They need to pivot to respond to external (disruptive) innovations, and they need to rethink their underlying assumptions to stay creative and innovative internally. These capabilities belong to the second loop of a double-loop organization.
Virtual Democracy 