Ki work: A platform for fractional work

Michael Wolff has been explaining what ki work is for many years.  This is perhaps one of the best explanations because he's set it in context so well. In a recent email thread written in response to a query from an interim management firm Michael says;

people4business.com is a neatly structured freelance marketplace, primarily serving buyers and professionals in the UK. it is one of about a hundred “me-too” businesses that have followed the original models developed by elance and guru. apart from UK focus, it has very little to differentiate itself from the other 100 service providers in this market.

The underlying assumption of all elance look-alikes is that the fundamental organisational principle in all business is that demonstrated by the “firm”* or modern corporation. buyers are some kind of corporation, however small, and sellers are employed contractors to these corporations. the underlying reason is that hitherto it has been more sustainable and cost effective for businesses to be organised in this way, rather than a situation where the economy consisting exclusively of a multitude of independent, self-employed people who contract with one another. this model of business was classically explained by ronald coase in 1937 in his famous article: the nature of the firm.

However ki work is truly part of the online work revolution. we see the emergence of a new organisational model that is structured in such a way that “a multitude of independent, self-employed people who contract with one another” are able to complete transactions as reliably, but more cost-effectively, than the conventional firm. this organisational model has been pioneered within the open source development environment (http://sourceforce.org) and described in Yochai Benkler’s seminal work: coase’s penguin, or linux and the nature of the firm.

ki work takes the organisational concepts of sourceforge (where open source projects are organised on a free basis) and translates them into a model where multiple online work projects can be executed with remuneration for the suppliers. just as sourceforge is a utility enabling virtual open projects, so is ki work the utility for paid virtual projects.

Hence ki work’s main differentiator from the elance model: an organisational structure comprised of category marketplaces, which are  co-ordinated by category leaders and experts. this forms the basis for the creation of virtually outsourced projects, executed by “a multitude of independent, self-employed people who contract with one another”.

What relevance does this have in the interim management market? until you surfaced we did not include “interim management” as a category. our perception is that interim managers focus primarily on getting work in conventional businesses as a form of temporary employment (rather like elance), and as such, are not generally attuned to becoming leading players in the emergent virtual outsourcing market. however, I suspect that a small percentage (maybe 20%) of interim managers would be interested in the emergent opportunities, and I see our “interim management” category as being an alternative to “project management”.

So regarding people4business.com and all the other ones like them, I do not see these as a threat but as a valuable channel for creating awareness in the marketplace. the elance model, now 10 years old, is due to be superseded by the virtual organisational model. ki work is leading the way.

These models are starting to emerge in the creative industries.  Andy Law of St Luke's has created a worldwide network of partners at The LAW Firm, Citizen Agency started as a network of advertising, marketing and web 2,0 professionals, and John Caswell's GroupPartners' expert network delivers most of the value to its clients.  So when will we see Agency.com, AKQA, BBH and others adopt these fractional models of work and start leveraging these platforms to make their biggest cost (people) variable rather than fixed?