How do democracies innovate in a complex world?
How do democracies innovate in a complex world? How do we make the necessary philosophical transition from an object-oriented world view in an infinite-world scenario to an interdependent world view in a small-world scenario? How do we avoid the pitfalls that accompany the romanticisation of the small and the local, implementing something that is massively replicable and global in its impact and influence? Is it possible to draw on radical civics and sovereign interdependence as a new form of aggregation that will enable the future of democracy?
Democracies require a different systems, organisational, and aggregation logic. Since the industrialisation of labour and education we have been subject to the logic of centralised command-and-control and the widespread implementation of scientific management techniques. This has affected historic innovation models, which have tended to be top-down. They have been at odds, therefore, with the notion of democracy and the idea of the sovereign agency of all that underpins it.
If democracies cannot build decentralised, distributed capacities for innovation with coordinated mutual learning and recognition of interdependence, then they will struggle to make the complex transitions necessitated by the challenges and opportunities that confront us. This is where Systems Innovation is so different. It is symbiotic with democracy. If you require a large number of agents to drive transformation, then the innovation capacity has to be as micro as possible and agency has to be established at that particular level. In the decentralised, distributed, and coordinated model that System Innovation enables, agency to change is preserved by all.
Today, most of our contractual and governance landscape is constructed from a management theory model. This encompasses grant agreements, employment contracts, and governance mechanisms. Even charity governance boards tend to conform to this command-and-control architecture rather than implementing a distributed risk model. In effect, we have a structural problem that is preventing full flourishing from a systems perspective. We have to transition beyond a command-and-control economy, beyond even a co-benefits economy, to a care economy in which every agent becomes a carer. At present, what we have is the veneer rather than the reality of democracy.
We can see this with the Collective Impact approach to solving social problems. This centralises decision-making at the level of the Collective Impact Strategy Group, but collective decision-making is problematic in complex realities because of the asymmetries between information and context. It is the agents within the system who can reconcile the two, who are attuned to the micro sensitivities and asymmetries that drive the innovation they require. They are the ones who are most conscious of the impact of innovation and its spillover effects. They know what is necessary for their immediate context and situational reality.
This is something that external consultants lack, which begs the question why they are so often invited by organisations to conduct systems mapping exercises as opposed to building system learning & development spaces, infrastructures and protocols. It’s an endemic issue reflecting the tokenism of much Systems Innovation funding. A lot of reports are generated but little is done to effectively advance Systems Innovation itself. Whatever is learned from systems mapping exercises tends not to be shared democratically. In fact, more often than not, when a consultant is hired, the knowledge sits externally with them rather than with the system agents themselves who require it to effect any meaningful change and who can add contextual nuance to it.
Too often, when attention is paid to Systems Innovation, the focus is placed on a suite of products or portfolio of services. Instead, what is required is innovation of the system conditions. The necessary changes to products and services will then follow. What needs to be addressed is the ‘dark matter’ of systems: the behaviours, architecture, protocols, shared language, contracting agreements, feedback mechanisms, metrics, and so forth.
This then allows for emergence and scaling, in part because it demands that structural lock-ins (including debt, technology, carbon-distressed assets, and constraints on human interaction) that so often inhibit or block change are tackled head on. To do this, though, it is necessary to work at a variety of levels:
- * Culture
- * Social contract
- * Historical justice
- * Deep code
- * Organisational theory
What results from multi-level interventions is a different governance method. This is where Systems Innovation can be viewed as a dark force because it changes the rules and the deep code structures, carrying with it the risk of another form of lock-in: the presumption of a higher order of control. Indeed, a challenge with Systems Innovation is that it can falsely create a God-like world view, which is complete anathema to complexity and emergence theory.
Forewarned, though, is forearmed, and there is much to be learned from those who sit on the other side of the fence and subscribe to a different world view. The reactionary Koch Brothers, for example, exert huge influence over US politics. They have dedicated time, effort, and money to the construction of ‘political railroads’, establishing think tanks, funding public intellectuals, and investing in standards institutes. This has been a conscious exercise on their part, which has proven to be far more effective than anything we have seen in recent years from left-leaning progressives. The latter initiatives have tended to be outdated and tainted by ideological argument. The trick for the progressives is to take what is useful from the other side while ensuring that they do not themselves become what they want to challenge.
The commandeering of language, the re-definition and emphasis placed on certain terminology, is one example. Language can be another means of creating structural lock-in, and can either reinforce or undermine the God-like position associated with traditional systems of control. Financial instruments are yet another. They can either perpetuate the old economy or create something new. In fact, transition financing, making use of such instruments as Smart Perpetual Bonds, is essential to Systems Innovation, requiring an unprecedented order of capital (in the hundreds of millions) not seen before in the social investment arena.
For Systems Innovation, the hybridity of economies is vital. It is as necessary, for example, to take into consideration the gift economy as it is micro transactional finance. Without a hybrid economy perspective – capital and social capital; finance and recognition – it is difficult to establish value (rather than cost) structuring. Without it, we find ourselves in a nonsensical world in which everything is treated in terms of financial transactions. This, again, strips away nuance, disregards context, and denies the fundamental importance of systemic relationships.
Hybridity also has to inform how we think about the state and its role in democracy. We require a new structural imagination regarding the very idea of state, of governance, of statecraft. We need to bolster certain capacities of state (such as market shaping) while, at the same time, breaking up the state, thinking in terms of interrelationships and plurality, of the publics rather than the public, of the micro many states rather than the singular state. The role of the state needs to be segmented and turned into multiple publics, transcending the public/private illusion, and focused on the means to secure, create, and shape governance for public good and utility by and for all.
These publics – as should be the case in a democracy – can be in creative disagreement and tension with one another with different forms of legitimacy. Radical civics, moreover, challenges the state as the only means to enhance the publics. Bitcoin, for example, has disintermediated the state and the private sector from the thesis of currency to construct something radically new. We need to similarly address the architecture of the state so that it is about more than just citizens. It needs to be about sovereignty, about sovereign actors and their interdependence on multiple agents.
In an age of complexity and emergence, centralised governance for public good performed by the state has failed. It is not able to cope with distributed, decentralised innovation. This leaves us with common goods, resources, equity, and futures that are monopolised, corrupted, and locked-in. Climate change, air pollution, and inequality are mere symptoms of this reality. Every transition requires work on dismantling and reorganising. Because we tend to focus on the new, however, the lock-ins are often ignored, and this prevents us from moving forward. History reveals that we have a choice: we can address lock-ins through violence (war, revolution) or through social constructs (debt jubilees, truth-and-reconciliation commissions).
As we evolve our notions of state, democracy, and Systems Innovation, we have to move from an extrinsic model to an intrinsic one that recognises granularity and hybridity. Small is beautiful, as Schumacher argued, but so is the wholeness and entanglement that will signal the collapse of our current, intermediary systems theory. For now, we have to make the most of the symbiotic relationship between democracy and Systems Innovation, but we also have to prepare for a future that will require a completely different model too. Indeed, Schumacher himself noted the need for ‘straining and stretching to a higher level which is the specific challenge of a divergent problem, a problem in which irreconcilable opposites have to be reconciled.’
This piece brings together some of the underlying reflections, work and direction of travel we have exploring with many of our partners. The underlying question of how we do change in 21st century deep democracies is a foundational challenge and requires a new expanded thesis of democracy, human development, freedom and a structural challenge to the duopoly of State and Market.
My sincere thanks to Jennie Winhall and Charlie Leadbeater whose questions and conversation helped me reflect further on these ideas, and the brilliant support of Richard Martin in making these thoughts legible.
