The debate about how many and what kinds of jobs smart machines will leave for humans to do misses a salient point, argues author Thomas W. Malone. Just as the automation of human work allowed people and machines to do many things that couldn't be done before, groups of people and computers working together will be able to do many things that neither can do alone now.To think about how this will happen, Malone says, it helps to recognize that virtually all human achievements -"from developing written language to making a turkey sandwich"-require the work of groups of people, not just individuals working on their own. As Malone explains it, "superminds"-groups of individuals acting together in ways that seem intelli-gent -take many forms, including the hierarchies in most organizations; the markets that help create and exchange many kinds of goods and services; the communities that use norms and reputations to guide behavior in many professional, social, and geographical groups; and the democracies that are com-mon in governments and some other organizations. Increasingly, machines can take part in the activities of these groups. "That means we will be able to combine people and machines to create superminds that are smarter than any groups or individuals our planet has ever known,"Malone says. Malone describes a future where humans and computers play different roles, with computers begin-ning as tools, then moving progressively into becoming assistants, peers, and then managers. Before we have general AI, he writes, "we can create more and more collectively intelligent systems by building societies of mind that include both humans and machines, each doing part of the overall task."

Since 1776, when Adam Smith described how the division of labor could spur economic progress, work has increasingly been broken into ever smaller tasks performed by ever more specialized workers. Now, however, as knowledge work expands and technology advances, we've entered a new era of hyperspecialization: Work previously done by one person is divided into more-specialized pieces done by multiple people, achieving improvements in quality, speed, and cost. For example, the start-up software firm TopCoder chops its clients' IT projects into bite-size chunks and offers them to its worldwide community of developers in the form of competitive challenges. The developers aspire to be ranked among the company's top coders, virtually guaranteeing quality in the winning end products. A company called CastingWords produces transcripts of audio files by farming out segments to remote workers for simultaneous transcription: Many hands make (extremely) fast work. The nonprofit Samasource sends data-entry work to marginalized individuals in the developing world, where tiny jobs lasting just minutes and paying just pennies give workers an economic boost while creating substantial savings for clients. Managers who want to capitalize on hyperspecialization's possibilities need to learn how best to divide knowledge work into discrete tasks, recruit specialized workers, ensure the quality of the work, and integrate the pieces into a final whole. Meanwhile, companies and governments must be aware of the potential perils of this new age: "digital sweatshops" and other forms of worker exploitation; nefarious schemes hidden behind task atomization; work that becomes dull and meaningless; increased electronic surveillance of workers. All these, the authors believe, could be ameliorated by global rules and practices and a new form of "guilds" to provide workers with a sense of community and support for professional development.

This is an MIT Sloan Management Review article. Google. Wikipedia. Threadless. All are platinum exemplars of collective intelligence in action. Two of them are famous. The third is getting there. Each of the three helps demonstrate how large, loosely organized groups of people can work together electronically in surprisingly effective ways -- sometimes even without knowing that they are working together, as in the case of Google. In the authors' work at MIT's Center for Collective Intelligence, they have gathered nearly 250 examples of web-enabled collective intelligence. After examining these examples in depth, they identified a relatively small set of building blocks that are combined and recombined in various ways in different collective intelligence systems. This article offers a new framework for understanding those systems -- and more important, for understanding how to build them. It identifies the underlying building blocks -- the "genes" -- that are at the heart of collective intelligence systems. It explores the conditions under which each gene is useful. And it begins to suggest the possibilities for combining and recombining these genes to not only harness crowds in general, but to harness them in just the way that your organization needs.

Multiplayer online role-playing games are sprawling cybercommunities that offer a sneak preview of tomorrow's business environment. Players who lead teams in these online worlds hone the skills that they will need as business leaders in the future. Games also provide an environment that makes being an effective leader easier and that today's businesses might try to replicate selectively in their own organizations. Those are the principal findings by Reeves, of Stanford University; Malone, of MIT's Sloan School; and O'Driscoll, of North Carolina State. As part of an analysis conducted by Seriosity, a company that develops game-inspired enterprise software, the authors studied people who headed up teams in online games. They also sought the insights of gamers who have led real-world business teams at IBM. The authors identified three distinctive characteristics of leadership in online games that, as workplaces and the overall business climate become more dynamic and gamelike, will be essential for tomorrow's leaders: speed, risk taking, and acceptance of leadership roles as temporary. The most important finding, say the authors, is that getting the leadership environment right can be as important as choosing the right leader. They point out two aspects of game environments that companies might consider adopting: One, nonmonetary incentives built into a game economy strongly motivate individuals to accomplish group aims. Two, hypertransparency of information about, for example, team members' capabilities and teams' real-time performance makes it simpler to match people with tasks and to empower individuals to manage themselves.

Today's top executives are expected to do everything right, from coming up with solutions to unfathomably complex problems to having the charisma and prescience to rally stakeholders around a perfect vision of the future. But no one leader can be all things to all people. It's time to end the myth of the complete leader, say the authors. Those at the top must come to understand their weaknesses as well as their strengths. Only by embracing the ways in which they are incomplete can leaders fill in the gaps in their knowledge with others' skills. The incomplete leader has the confidence and humility to recognize unique talents and perspectives throughout the organization--and to let those qualities shine. The authors' study of leadership over the past six years has led them to develop a framework of distributed leadership that consists of four capabilities: sensemaking, relating, "visioning," and inventing. Sensemaking involves understanding and mapping the context in which a company and its people operate. A leader skilled in this area can quickly identify the complexities of a given situation and explain them to others. The second capability, relating, means being able to build trusting relationships with others through inquiring, advocating, and connecting. Visioning, the third capability, means coming up with a compelling image of the future. It is a collaborative process that articulates what the members of an organization want to create. Finally, inventing involves developing new ways to bring that vision to life. Rarely will a single person be skilled in all four areas. That's why it's critical that leaders find others who can offset their limitations and complement their strengths. Those who don't will not only bear the burden of leadership alone but will find themselves at the helm of an unbalanced ship.

During the dot-com boom, many people saw the potential for new communication technologies to enable radically new business models, but they were far too optimistic about the speed with which the revolution would occur. Now, as the bitter disillusionment of the dot-com bust begins to fade, we have a chance to think again--this time more rationally--about how best to take advantage of the remarkable changes these new technologies are gradually making possible. One such change is the ability to create markets inside companies, allowing decision making to be decentralized and introducing some of the efficiency, flexibility, and motivating influence of free markets. In this article, the author examines this nascent form of business organization, exploring the benefits as well as the potential risks. BP, for example, met its goal of reducing the company's greenhouse gas emissions nine years ahead of schedule, not by setting and enforcing targets for each division but by allowing business unit heads to buy and sell emissions permits among themselves using an electronic trading system. And Hewlett-Packard recently experimented with a system that allowed employees to buy and sell predictions about likely printer sales, using a kind of futures contract. The markets ended up predicting the actual printer sales with much more accuracy than official HP forecasts. At a fundamental level, these changes are enabled by the fact that electronic technologies allow information to be widely shared at little cost. This simple fact has a profound implication for organizing businesses. When more people have more information, they can use it to make their own well-informed decisions, appropriate to local circumstances, instead of following orders from above. As a result, even very large companies can benefit from the collective wisdom of their employees.

In this eye-opening article, Thomas W. Malone and Robert J. Laubacher of the Massachusetts Institute of Technology look at how a new kind of organization could form the basis of a new kind of economy--an e-lance economy--where all the old rules of business are overturned and big companies are rendered obsolete. Drawing on their research at MIT's Initiative on Inventing the Organizations of the 21st Century, the authors postulate a world in which business is not controlled through a stable chain of management in a large, permanent company. Rather, it is carried out autonomously by independent contractors connected through personal computers and electronic networks. These electronically connected freelancers--e-lancers--would join together into fluid and temporary networks to produce and sell goods and services. When the job is done--after a day, a month, a year--the network would dissolve and its members would again become independent agents. Far from being a wild hypothesis, the e-lance economy is, in many ways, already upon us. We see it in the rise of outsourcing and telecommuting, in the increasing importance within corporations of ad-hoc project teams, and in the evolution of the Internet. Most of the necessary building blocks of this type of business organization--efficient networks, data interchange standards, groupware, electronic currency, venture capital micromarkets--are either in place or under development. What is lagging behind is our imagination. But, the authors contend, it is important to consider sooner rather than later the profound implications of how such an e-lance economy might work. They examine the opportunities, and the problems, that may arise and anticipate how the role of managers may change fundamentally--or possibly even disappear altogether.

American Hospital Supply's order-entry system represents a trend toward "electronic markets," networks that allow customers to compare and order from competing suppliers. By cutting transaction costs, electronic markets make it cheaper to buy than to make many products and will lead to more market activity and fewer vertically integrated companies. Customers like the efficiency and convenience of electronic sales channels but want to choose among different vendors. Business can take advantage of the trend by creating electronic markets - alone or as part of an industry group.