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Catalyst Organizations as a New Organization Design for Innovation: The Case of

Hyperloop Transportation Technologies
Article in Academy of Management Discoveries · March 2018

DOI: 10.5465/amd.2017.0041
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Academy of Management Discoveries
CATALYST ORGANIZATIONS AS A NEW ORGANIZATION

DESIGN FOR INNOVATION:
THE CASE OF HYPERLOOP TRANSPORTATION
TECHNOLOGIES
Journal: Academy of Management Discoveries
Manuscript ID AMD-2017-0041.R2
Manuscript Type: Revision
Organizational Design, Structure and Control < Organizational &

Keywords: Management Theory, Innovation < Performance & Effectiveness,
Organizational Design < Strategy Implementation
The crucial contingencies surrounding organization design for innovation

are experiencing drastic shifts. First, environmental uncertainty is rising
with the increasingly connected nature of innovation. Second, the internet
provides an almost costless supply of external knowledge. Current
organization design theory does not provide adequate frames for studying
organizations attempting to simultaneously leverage shifts of uncertainty
and the costless supply of external knowledge. In the process of
Abstract: qualitatively examining one such organization – the crowd-based
Hyperloop Transportation Technologies, Inc. (HTT) – we find that HTT’s
design does not fit existing design schema. We label this new design form
a “catalyst” organization, clarifying how HTT’s design challenges existing
organization design principles while simultaneously showing researchers a
way forward to new theorizing. We derive implications for theories of
organization design, exploration, and online knowledge-creating
communities.
Copyright 2018 by Academy of Management.

Page 1 of 56 Academy of Management Discoveries
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3 CATALYST ORGANIZATIONS AS A
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NEW ORGANIZATION DESIGN FOR INNOVATION:
6 THE CASE OF HYPERLOOP TRANSPORTATION TECHNOLOGIES
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9 ANN MAJCHRZAK TERRI L. GRIFFITH
10
University of Southern California Santa Clara University
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12 Marshall School of Business Leavey School of Business
13 Los Angeles, CA 90089-1421 Lucas Hall
14 USA Santa Clara, CA 95053
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16 Tel: +1-213-740-4023 USA
17 e-mail: majchrza@usc.edu Tel: +1-408-256-3141
18 e-mail: t@terriGriffith.com
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21 DAVID K. REETZ OLIVER ALEXY
22 Technische Universität München Technische Universität München
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24 TUM School of Management TUM School of Management
25 80333 Munich 80333 Munich
26 Germany Germany
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28 Tel: +49-89-289-52803 Tel: +49-89-289-52803
29 e-mail: david.reetz@tum.de e-mail: o.alexy@tum.de
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Acknowledgements
38 We thank Hyperloop Transportation Technologies, Inc. for their willingness to engage in
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40 this research. The first and second authors are HTT contributors and receive small amounts of
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42 equity compensation from that role. Earlier versions of this manuscript have greatly benefitted
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from the feedback of conference participants at the 2016 Open and User Innovation Conference
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45 and Michael Tushman. All remaining errors are of course our own.
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Academy of Management Discoveries Page 2 of 56
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9 ABSTRACT
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11 The crucial contingencies surrounding organization design for innovation are experiencing
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14 drastic shifts. First, environmental uncertainty is rising with the increasingly connected nature of
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16 innovation. Second, the internet provides an almost costless supply of external knowledge.
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18 Current organization design theory does not provide adequate frames for studying organizations
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21 attempting to simultaneously leverage shifts of uncertainty and the costless supply of external
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23 knowledge. In the process of qualitatively examining one such organization – the crowd-based
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25 Hyperloop Transportation Technologies, Inc. (HTT) – we find that HTT’s design does not fit
26
27
existing design schema. We label this new design form a “catalyst” organization, clarifying how
28
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30 HTT’s design challenges existing organization design principles while simultaneously showing
31
32 researchers a way forward to new theorizing. We derive implications for theories of organization
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34 design, exploration, and online knowledge-creating communities.
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41 Keywords: innovation, crowds, organization design, gig economy, environmental uncertainty
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9 The 21st century has brought paradigm shifts in organization design for innovation. Caused
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11 by the spread of the internet and globalization, firms compete on an innovation landscape
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14 characterized by 1) increasing environmental uncertainty with interdependencies of
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16 technological developments (requiring continuous and coordinated innovation in technology,
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18 strategy, and product; Santos & Eisenhardt, 2009); and 2) near-zero information exchange costs
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21 (Altman, Nagle, & Tushman, 2015) creating an almost costless supply of external knowledge
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23 available to the firm. This supply of external knowledge comes, not simply as information
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25 transmitted across various media and formats, but in the form of people sharing their knowledge
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and labor with the firm. A wealth of potential part-time contributors are available through
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30 internet-enabled coordination tools ranging from gig-economy business platforms (e.g.,
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32 Freelancer.com, UpWork) to interest-based community forums such as reddit and Digg. This
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34 supply of knowledge, combined with environmental uncertainty, creates a ‘perfect storm’ that
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37 affects the way we can or should design innovating organizations.
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39 To identify what this may imply for our theorizing, we study how Hyperloop Transportation
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41 Technologies, Inc. (HTT) created an organization design which catalyzes the supply of external
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44 knowledge as the exclusive source of resources the firm uses. HTT’s mission is to change the
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46 nature of public transportation from largely being slow, expensive, financially insolvent and
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48 environmentally unsustainable to a system which is not only financially solvent, but so fast,
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inexpensive, and enriching that people will decouple where they work, play, and live. Achieving
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53 this vision involves the development of a slew of complex technologies, not the least of which is
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55 the hyperloop -- a pod magnetically levitated within a vacuum tube able to cost-efficiently travel
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2
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3 at speeds up to 700 mph (see Figure 1 for artists’ renderings).
4
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6 --------Insert Figure 1 About Here--------
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8 What makes HTT unique from its competitors (and most of the received organizational
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10 design literature) is not just its expansive vision, but the organization design it uses to execute on
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its vision. At the moment, HTT has fewer than 12 employees, though the CEO notes that this
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15 number is fluid. Instead, it is almost entirely staffed by over 800 contributing professionals
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17 distributed around the world. They exchange their as-needed part-time work hours for stock
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options. Another group of over 50,000 individuals on various social media sites provide
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22 opportunities for business development. The 800 contributors are not tangential actors as would
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24 be used by organizations outsourcing to Upwork or other gig economy platforms (e.g., Barley,
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26 Bechky, & Milliken, 2017), or in new organizational forms such as Oticon (Foss, 2003), but are
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29 actors pursuing core strategic activities such as business development, partnership agreements,
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31 basic R&D, lobbying public officials, marketing, human resource activities such as onboarding,
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33 in-field feasibility analyses, and hardware and supply acquisition.
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As with many of these emerging organization designs (Fjeldstad, et al., 2012; Gulati,
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38 Puranam, & Tushman, 2012; Puranam, et al., 2014), HTT, at its foundation, is designed as would
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40 be expected: contributors are self-organizing actors sharing knowledge through a commons with
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the multi-actor collaboration enabled with “protocols, processes, and infrastructures” (Fjeldstad,
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45 et al.: 739). However, such foundational characteristics fail to capture important nuances for how
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47 HTT uses environmental uncertainties and knowledge supply to pursue its mission. For example,
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49 even though actors are to some extent self-organizing some aspects of their organization, there
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52 are other aspects that are not self-organized in order to rapidly proceed with opportunities as they
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54 surface. Instead of laterally coordinating, as described for many of the new organizational forms
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3 (Fjeldstad et al., 2012; Dahlander & O’Mahony, 2011; Faraj et al., 2011), HTT is organized to
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6 allow coordination hierarchically, bottom-up, layered, as well as laterally. Instead of
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8 decomposing tasks as is commonly seen even among new organizational forms (Puranam et al.,
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10 2014; Baldwin & Clark, 2006; MacCormack, Rusnak, & Baldwin, 2006), HTT does not. Instead
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of openly sharing projects for external contributors to join, as is commonly done among such
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15 new organizational forms as Wikipedia and open source software, as well as private
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17 organizations such as Intel, Accenture, or Dell (Fjeldstad et al., 2012; Bayus, 2012), HTT does
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not. Instead of recruiting self-organizing actors, as has been described for these new
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22 organizational forms (Fjeldstad et al., 2012), HTT leverages actors of all types, including those
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24 not particularly self-organizing.
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26 Therefore, we offer HTT as an additional novel form of organizing using the criteria for
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29 novelty proposed by Puranam and colleagues (2014). HTT solves the “universal” challenges of
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31 organizing (task division, task allocation, reward distribution, information flows, and exception
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33 handling) in new ways – but in a way so intermingled, dynamic, and with different foci as to
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demand new theory. HTT is not so much a new form of organizing built out of “novel bundles of
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38 old solutions” (Puranam et al., 2014: 173), but a new form of organizing enabled by an almost
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40 costless supply of external knowledge. This catalyst organizational form is structurally different
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from a collaborative community (e.g., Fjeldstad et al., 2012), or similar organization forms
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45 previously hailed as novel (see Puranam et al., 2014).
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47 The novelty of HTT’s catalyst organization design may be most easily understood when
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49 described as a passion-driven, dynamic organization which uses an almost unlimited availability
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52 of specialized knowledge to create and capture an almost unlimited supply of unanticipatable
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54 opportunities. This new organizational form (1) uses non-modular task division and allocation to
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3 create limitless options, and (2) integrates work in a manner that allows for continuous
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6 exploration even in the face of the need to produce. Its opportunity orientation transcends the
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8 actor-orientation of other new organizational forms (Fjeldstad et al., 2012) by allowing
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10 contributors throughout the system to match opportunities to available resources in a manner in
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which the matching is not simply of different types of skills, but also in different levels of
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15 commitment, different objects of passion, and non-overlapping relational networks. The
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17 organization has those committed and those less committed, with the most committed (such as
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the CEO, “hyperleaders,” Chairman of the Board, Director of Operations) leading the charge.
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22 Instead of standardized protocols, there are “guardrails” which allow individuals substantial
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24 discretion within broad direction. Instead of basing coordination on dynamic lateral
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26 relationships, HTT uses multiple different coordination mechanisms at once.
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29 Despite these differences from common organizational design wisdom, HTT is successful
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31 thus far. Within the first 34 months of its existence, HTT had 25 design patents pending; 49
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33 corporate partners with agreements in United States, Slovakia, the United Arab Emirates,
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Indonesia, India, South Korea, and France; booked $31.8M in cash investments, obtained $29M
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38 in commitments and in-kind investments, received $22M in land rights; and had over 150,000
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40 hours in development work provided by contributors in exchange for stock options. Compared to
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their strongest competitor, HTT has been able to accomplish more with less expenditures. The
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45 quality of the HTT hyperloop is meeting such safety, cost, and reliability targets that it is being
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47 insured by the largest insurance company in the world.
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49 How HTT has been able to accomplish this with fewer than 12 fulltime staff – of which nine
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52 were hired only in the last year – is the focus of our research. Our initial look at HTT indicated
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54 that its differentiation and integration organization design schemes were quite different from
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3 those described in hierarchical designs (March and Simon, 1958; Perrow, 1967; Thompson,
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6 1967) as well as in collaborative communities (Fjeldstad et al., 2012). Therefore, our intention
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8 here is to first describe the literature in terms of the pressures on traditional design characteristics
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10 related to knowledge supply and environmental uncertainty, and how we would expect HTT to
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be designed. Then we describe HTT’s organization design. Finally, in the discussion, we
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15 summarize the elements of a catalyst organization.
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17 Our summary argument from our examination of HTT is that, as organizations become
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increasingly open to embracing uncertainty and low-cost external knowledge, organizational
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22 design researchers will need to reconsider how differentiation and integration are conceptualized.
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24 In these new catalyst forms of organizations, differentiation and integration give way to a
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26 constant matching process in which projects, people, skills, and opportunities are morphed to fit
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29 each other. The organization works because it focuses on evolving actionable objectives rather
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31 than tasks, dialectical learning rather than integration, opportunity seizing from the bottom up
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33 rather than exclusively top-down, and emergent and temporary roles aligned with varying layers
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of commitment, instead of job titles. Managers may become just another temporary and
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38 emergent role represented by those most willing to commit the time to broker, negotiate,
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40 orchestrate and catalyze those individuals temporarily less committed.
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THEORETICAL BACKGROUND
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45 Organization design is the process of designing roles, rules, and relationships that govern
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47 any organizational activity (DeSantola & Gulati, 2017). To do so cohesively, any organization
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49 design must address at least these fundamental challenges: 1) task division and allocation (jointly
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52 referred to as the division of labor); and 2) reward provision (motivation), information provision
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54 (coordination), and exception management—jointly referred to as the integration of effort
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6
1
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3 (Galbraith, 1973; March & Simon 1958; Puranam, Alexy, & Reitzig, 2014).
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6 Research has shown increasing environmental uncertainty (Burns & Stalker,1961; Grandori,
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8 2010; Lawrence & Lorsch, 1967) adds complexity to the division of labor and integration of
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10 effort. In addition, some have suggested that decreasing information costs will also affect these
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two fundamental challenges (Altman et al., 2015; Chesbrough, 2003; Zittrain, 2006). In the
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15 presence of both a surplus of low-cost external knowledge and environmental uncertainty, there
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17 are significant limitations in what is known. For example, despite a burgeoning literature on the
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creation of radical, complex innovation through innovation ecosystems (Adner, 2012; Adner,
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22 Oxley & Silverman, 2013), there is a still a paucity of work on how to design organizations that
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24 would steer ecosystem creation under high uncertainty (Dattée, Alexy, & Autio, 2017; Le
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26 Masson, Weil, & Hatchuel, 2009), in particular when it comes to incorporating opportunities
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29 facilitated by increasing connectivity and decreasing costs of collaboration (Tilson; Lyytinen &
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31 Sørensen, 2010; Yoo, Henfriedsson, & Lyytinen, 2010). Similarly, in the extensive literature on
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33 project- and community-based approaches to radical innovation (Foss 2003; Foss & Dobrajska,
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2015), organizational design is focused on increasing efficiency of coordination and resource
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38 usage; yet, in a context of significant uncertainty and surplus of resources, efficiency may be less
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40 important than effectively capturing opportunities.
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Below we examine the literature on the effects of uncertain environments, then the effects of
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45 low-cost knowledge, on integration and task division organization design choices. We then show
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47 how we build on this research to suggest a series of analytic questions for our case study.
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49 Effects of More Uncertain Environments on Organizational Design
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52 Looking at work on organization design in high-uncertainty contexts, classic research
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54 suggests organizations should create structures that are organic, adaptable, loosely-coupled, and
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3 ambidextrous (Burns & Stalker, 1961; Davis, Eisenhardt, & Bingham, 2009; Lawrence &
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6 Lorsch, 1967; Thompson, 1967; Tushman & O’Reilly, 1996). Organizational actors are expected
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8 to deliberately react to the changing environmental contingencies by rapidly changing to new
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10 organizational forms (Rindova & Kotha, 2001; Romanelli, 1991), drawing on their dynamic
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capabilities for change (Eisenhardt & Martin, 2000; Teece, Pisano, & Shuen, 1997).
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15 Yet, as uncertainty and ambiguity of the environment increases, the precise nature of the
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17 organic, loosely-coupled, and ambidextrous organization becomes increasingly indeterminable
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(Cardinal, Kreutzer, & Miller, 2017; Dattée et al., 2017; Davis et al., 2009). Firms need to
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22 continuously search for technological and market-related discoveries before arriving at
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24 something that can be successfully commercialized. Any newly arriving piece of knowledge may
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26 not only provide a new opportunity individually, but also contain novel information about how
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29 all other existing pieces of knowledge are (to be) connected (Drazin & Van de Ven, 1985; Miller,
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31 1987) as they cannot directly anticipate the composition of the eventual value proposition for the
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33 market.
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Moreover, scholars suggest that organization designs in such highly uncertain environments
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38 need to foster broad and external exploration in order to discover all relevant problem aspects
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40 and their interconnections, (Katila & Ahuja, 2002), drawing on techniques such as structural
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ambidexterity (Lavie & Rosenkopf, 2006; Lavie, Stettner, & Tushman, 2010; Tushman &
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45 O’Reilly, 1996) or open innovation (Chesbrough, 2003). “Incomplete” organizations (Garud et
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47 al., 2008) are one design option for settings where the exploration is so continuous and extensive
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49 that the “boundary between the entity being designed and the context for which it is being
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52 designed” (Garud et al., 2008: 351) is neither clear nor stable. Such organizations, even when not
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54 been labeled as incomplete, have neither defined membership boundaries (Etzion & Ferraro,
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3 2010) nor a statically defined purpose, but the discovery or emergence of said purpose may be
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6 the initial goal of the organization (Tsoukas & Chia, 2002). One of the implications of such
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8 uncertainty for organizational design may be one of rendering any a priori task division moot or
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10 even counterproductive (Reetz & MacAulay, 2017; Sarasvathy, 2001).
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An example is Dattée and colleagues’ (2017) description of ecosystem creation under
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15 uncertainty, which they outline as an abductive process of discovery, rather than a priori
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17 planning. Their argument is reminiscent of earlier work emphasizing the nature and importance
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of design to tackle situations of high uncertainty (e.g., Dunne & Martin, 2006; Gruber, De Leon,
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22 George, & Thompson, 2015; Simon, 1996). That work, which should still be considered an
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24 emergent field of study (Garud, Gehman, & Kumaraswamy, 2011; Jelinek, Romme, & Boland,
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26 2008), suggests that organization designs in high uncertainty environments should not
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29 necessarily try to respond to uncertainty through planning, but rather enable the theorizing and
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31 exploration of multiple possible trajectories, as well as constantly adapting as new knowledge is
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33 discovered.
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Effects of Low-Cost Knowledge Supply on Organizational Design
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38 Resources are a natural limit to such broad explorations. It is in this context that the decrease
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40 of information costs, which some even consider as zero given technological progress (Altman et
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al., 2015), leads to an abundance of the availability of external knowledge. Decreasing
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45 knowledge costs will not only allow the organization to explore more broadly for innovation, but
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47 also to involve an increasing number of external contributors.
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49 However, to ensure broad exploration with external contributors, a variety of research
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52 streams, such as those on crowdsourcing (Afuah & Tucci, 2012), Wikipedia (Kane &
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54 Ransbotham, 2016), open innovation (Dodgson, Gann, & Salter, 2006), and open source
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3 software (Howison & Crowston, 2014) suggest that the tasks carried out by external contributors
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6 should be directed by the focal organization using a priori defined modularized tasks (also see
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8 Altman et al., 2015; MacCormack, Rusnak & Baldwin, 2006). This allows external contributors
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10 not only to perform tasks that are of the most utility to the focal organization; it also allows
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external contributors to perform the tasks at will, through self-selection. The literatures on meta-
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15 organizations (Gulati et al., 2012), supplier networks (Dyer, 1996), and distributed innovation
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17 communities (Bogers & West, 2012; Lakhani & Panetta, 2007) similarly depict the evolution of
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such organizations as dependent on a central hierarchy to control the task structure.
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22 Hence, at the system level, the organization controls the nature of the innovation. Indeed, we
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24 would argue that this logic underlies many crowd-based approaches currently discussed in the
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26 literature, in which surprisingly traditional organization designs (see also Puranam et al., 2014)
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29 are implemented to fulfill the purpose of the organization. Although this literature inspires the
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31 possibility of new organizational forms with less centralized control, the precise nature of how
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33 control is maintained in an environment of an abundance of external knowledge supply needs
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further development (Cardinal et al., 2017).
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38 We suggest that, if the organization can involve contributors and their knowledge and
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40 resources at zero cost, there is an advantage to the organization to engage an almost limitless
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supply in a variety of explorative efforts (Afuah & Tucci 2012; Argote & Greve 2007; Altman et
43
44
45 al., 2015). If during exploration the organization discovers new knowledge that requires a change
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47 in course or structure, reliance on external contributors for innovation should allow for faster
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49 response compared to a monolithic organization (e.g., Adner, 2012; Gawer; 2014). As such,
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52 integration across all the various explorations in the organization may be less important.
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54 In sum, shifting our focus to contexts of significant environmental uncertainty with low-cost
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3 knowledge supply suggests that an effective organization design may be one which does not
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6 modularize its tasks for external contributors. Moreover, how the organization integrates – if it
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8 even tries – these various efforts at exploration is not clear. What would task division look like if
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10 there was no a priori definition by the organization, and how would task allocation operate if
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there was no menu from which potential contributors would choose? How could such an
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15 organization ensure that contributors would be motivated, coordinated, and directed? In short,
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17 what would be an appropriate configuration of design choices for an organization that would
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seek to leverage a contributor community? Would there be new interdependencies or
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22 complementarities across design elements (Puranam et al., 2014; Fjeldstad, Snow, Miles, &
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24 Lettl, 2012), and what insights would these suggest for extant theories of organization and
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26 innovation? These are the analytic questions we turn to next.
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29 DATA AND METHODS
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31 HTT exemplifies an organization leveraging near-zero information costs within an
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33 environment of high uncertainty, trying to develop a radically new technological and market
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solution by purposively drawing on external contributors to explore broadly and deeply. To our
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38 knowledge, Hyperloop Transportation Technologies, Inc. (HTT) is the first commercial, large-
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40 scale organization involved in co-creating an entirely new industry ecosystem and technology
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42
developments with the involvement of thousands of contributors changing the future of
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45 transportation. We selected HTT purposefully because of this vast ambition.
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47 Background on Hyperloop Transportation Technologies, Inc. (HTT)
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49 The transportation industry is broken [co-founder, Dirk Ahlborn].
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52 There is no profitable mass transport system using available real estate today that is
53 human-centric, giving customers a rich humanistic experience [co-founder Bibop Gresta]
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3 Transportation is overcrowded, overloaded, overwhelmed [Chief Marketing Officer, Rob
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Miller]
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7 The hyperloop is one answer to the transportation industry’s woes but only if it is made
8 to be fast, safe, beautiful, net energy positive, and financially profitable, and the only way
9 to do that is to use existing technology when possible, the brightest and best minds to fill
10 in the technology gaps, and the willingness of thousands of people and organizations to
11 partner in order to help us change the worlds of insurance, finance, government
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13
regulations, and customer experience. [Dirk Ahlborn]
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15 HTT was inspired in 2013 by an Elon Musk white paper reminding the world of the
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17 technology for a hyperloop, that it was time for the world to move forward with hyperloop
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transportation, and Elon saying he was too busy to pursue it himself (more recently, one of
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22 Musk’s firms, The Boring Company, is signaling that it might take up the hyperloop challenge,
23
24 Gibbs, 2017). A hyperloop refers to a fully enclosed vacuum tube with a levitated capsule
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26 running inside the tube at up to 700 mph; the lack of air reduces the amount of energy needed to
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29 move the capsule forward.
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31 Shortly after the release of the white paper, HTT co-founder Dirk Ahlborn posted a project
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33 on jumpstartfund.com, a community of entrepreneurs, asking
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…our community if they thought we should be working on the [hyperloop] project. The
37 response was overwhelming. Many people said we should definitely do it, but there was
38 another button on that response page, one which said, ‘I would like to do this.’ The
39 overwhelming majority of people clicked that button as well. We then asked what the
40 company should be called and that is how the company started. [co-founder, Dirk
41 Ahlborn]
42
43
44 HTT’s co-founders selected a core group of about 100 top engineering and aerodynamics
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46 specialists from around the world based on applications submitted on jumpstartfund.com. The
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48 specialists spent some of their time not working on their day jobs to look at the technology side
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50
of hyperloop in exchange for becoming stakeholders in the company. The specialists concluded
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53 that the building of a hyperloop was possible by integrating existing technology, but that further
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55 research and development would be needed to make the hyperloop financially solvent and
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3 energy positive, and that substantial work would be needed to develop an ecosystem supporting
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6 fast, cheap public transportation.
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8 Ahlborn and co-founder Bibop Gresta accepted the challenge:
9
10 HTT would be a technology licensing company providing solutions that are technical,
11 marketing, and a series of tools to create a hyperloop. We are not going to build. We are
12
13
rarely going to be involved directly in the design-and-build. We will be a provider of
14 solutions in R&D and project management in the implementation of the project. Our
15 project management approach will be a local approach with a global mind; nation by
16 nation we will identify local partners. [Gresta]
17
18 Together they developed a business model for the company which was to engage the world
19
20
21 in a movement of passionate engineers, designers, programmers, lawyers, marketers,
22
23 videographers, people with connections to government agencies, people with ideas, research and
24
25 development labs, universities, engineering firms and more.
26
27
Our model is the unique opportunity of contribution…We have $60M in assets through
28
29 work, through land, through pumps, travel around the world, companies paying us to
30 hear us speak which is financing our business development; if we need a simulator we
31 use the university; if we need a wind chamber, we have 11 available to us. We are trying
32 to use resources that exist instead of creating new ones. It’s for improving this planet. It’s
33 not philosophical and hippie. We are building this hyperloop in a different way for the
34 solution of humanity. Our model implies coopetition with external partners. If we are
35
36
successful we open a new path. We can inspire others to embrace and dig into this.
37 [Gresta]
38
39 In their vision, this notion of involving others in changing the world of transportation is not
40
41 only inspiring but essential.
42
43
44 “I looked at why 100’s of prior ‘hyperloop-like’ projects have failed. They failed because
45 they were dependent on one company of one person. So, we need to build a movement not
46 dependent on a single person.” [Ahlborn]
47
48 As of December 2017, HTT’s organization consists of approximately 800 individuals, some
49
50
of which are working independently in exchange for stock options and others are working with
51
52
53 44 industry-leading companies who are partnering in exchange for stock options. There are
54
55 minimal cash transfers. The work is primarily virtual (except when conducting in-field feasibility
56
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60
13
1
2
3 tests), but takes advantage of in-person conversations when members of the executive board
4
5
6 travel to locations where external contributors and partners reside.
7
8 The core of HTT are the external contributors who have signed a contributor agreement with
9
10 a minimum 10 hour/week commitment in exchange for stock options. These contributors vary
11
12
13
broadly across professional disciplines including people from engineering (representing a wide
14
15 swath of industries and all subspecialties), project management, business development, human
16
17 resources, social media, videography, marketing, legal, financial, government relations, and
18
19
construction. While the contributors number 800 people, about 300 are actively working on
20
21
22 issues at any moment, conducting the work of preparing proposals, meeting customer
23
24 requirements, research and development, marketing, and management. Contributors are from all
25
26 over the world, doing their work typically in addition to their formal, more traditional, jobs.
27
28
29 Additionally, there is a broader set of thousands of contributors who come to HTT via social
30
31 media and who completely self-determine how much time they want to contribute and what they
32
33 want to contribute with no promise of stock options; these contributors have led to discovery of
34
35
36
new ideas, new knowledge, social media recognition, business opportunities, and designs.
37
38 Data Collection
39
40 In the tradition of engaged scholarship (Van de Ven, 2007), we combined an ethnography
41
42
with a series of interviews and private and public data on HTT. The first two authors joined HTT
43
44
45 for 18 months on a ten-hour per week basis and are assigned to the global operations group as
46
47 experts on virtual collaboration and crowdsourcing. At the point of their onboarding, HTT rolled
48
49 out an enterprise collaboration tool (Facebook @ Work, FB@W, rebranded by Facebook as
50
51
52 Workplace in 2016) for which they became administrators, as well as serving as the liaison
53
54 between engineering and global operations. This involved attending 80 engineering design and
55
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57
58
59
60
14
1
2
3 operations meetings. In addition, they conducted repeated semi-structured interviews with 15
4
5
6 team leaders and five other engineering team members, as well as seven interviews with the CEO
7
8 (five lasted an hour, one three hours, and one five hours). They used a structured interview guide
9
10 including questions about reasons why individuals were involved in HTT, status of work, and
11
12
13
issues of concern. Finally, the research team reviewed all 4,000 posts to the FB@W
14
15 collaboration site. Table 1 provides an overview of the data sources.
16
17 ------------Insert Table 1 About Here----------------
18
19
Data Analysis
20
21
22 We started our analysis by examining HTT’s organization design. For guidance, we used the
23
24 literature on challenges of organization design – the challenges all organizations must address to
25
26 support their existence. Here, we found it useful initially to follow Puranam and colleagues’
27
28
29 (2014) classification of task division, task allocation, incentives/rewards, coordination, and
30
31 decision-making for exceptions (Table 2 includes a summary of this assessment). Drawing on
32
33 this framework as a lens, we tried to identify the design choices that allowed HTT to operate at
34
35
36
the fruitful intersection of addressing uncertainty by leveraging a contributor community. Other
37
38 relevant work, especially Fjeldstad et al. (2012), was integrated the further we moved into the
39
40 interpretation of the data.
41
42
Our intuition from early conversations about HTT was that HTT’s design seemed to be
43
44
45 different from those previously described organizations making use of crowd-based actors. We
46
47 elaborated this view through repeated discussions with HTT leadership, in which the first two
48
49 authors, based on their initial notes, inquired about features of HTT’s organization design. We
50
51
52 then compared these features, individually and as a set, with existing literature describing related
53
54 phenomena (as reflected in Table 2), similar to cross-case comparisons (Yin, 2014).
55
56
57
58
59
60
15
1
2
3 -----------Insert Table 2 about here-----------------
4
5
6 To refine our understanding, and to follow good practice for qualitative work (Denzin &
7
8 Lincoln, 1998; Gioia, Corley, & Hamilton, 2013), the two authors involved with HTT discussed
9
10 their insights with the authors who were not. These discussions took place in person and
11
12
13
electronically, and facilitated by the iterative drafting and discussion of working papers
14
15 expressing preliminary findings. The team shared these drafts with HTT to ensure accuracy.
16
17 Proceeding in the above way, we became increasingly able to build bridges to existing
18
19
theory and enter a process of abductive reasoning (Mantere & Ketokivi, 2013; Peirce, 1878).
20
21
22 That is, we combined our increasingly refined observation of HTT with established logics of
23
24 organization design (as also described in our literature review) to derive a novel explanation of
25
26 how organizations may operate differently when leveraging high uncertainty by exploiting near-
27
28
29 zero information cost. We believe that the following offers the “best” explanation of the data, but
30
31 we also acknowledge that other scholars might look at the same data and find a different best
32
33 solution (Mantere & Ketokivi, 2013: 73). We look forward to other interpretations, but also offer
34
35
36
that our hybrid team (two authors involved with the organization and data collection, and two not
37
38 – as well as our editor and reviewers), helped in mitigating interpretive bias.
39
40 FINDINGS
41
42
We found that HTT’s organization design showed considerable overlap between the five
43
44
45 dimensions identified by Puranam and colleagues (2014). Accordingly, we collapsed the
46
47 dimensions into the classic two fundamental organizational design challenges of labor division
48
49 (i.e., task division and allocation) and integration of effort (i.e., information and reward
50
51
52 provision, to which we also add exception management). Below we describe the findings with
53
54 respect to the two aggregate dimensions, summarizing them in Table 3. To distinguish between
55
56
57
58
59
60
16
1
2
3 data obtained from the sources and our interpretations, we have put data in single-spaced italics,
4
5
6 indicating the source or set of sources.
7
8 -----------------------------Insert Table 3 about here---------------------------
9
10 Division of Labor
11
12
13
There is an overwhelming amount of work that needs to be accomplished for HTT to
14
15 develop a financially and environmentally sustainable hyperloop-based transportation system.
16
17 The list of work, as compiled from a range of documents and interviews, includes:
18
19
20
• Negotiating with governments and regulators to allow a “flying” device using magnetic
21 levitation and support initial costs of building one, as well as developing a new system of
22 regulations with governments since the hyperloop is neither a plane nor a train.
23
24 • Developing a range of technologies such as the hyperloop itself to meet the specifications
25 of being locally maintainable, safe, customer-centric, componentized to fit with different
26
nation needs, and low-cost; developing complementary products such as special steel and
27
28 windows to absorb impact; developing algorithms such as those for engineering the best
29 routes for the hyperloop in any nation undertaking a feasibility study; and integrating
30 alternative sources of energy to minimize the costs of operating the hyperloop.
31
32 • Developing organizational practices and information systems for managing a large
33
population of interested and contributing parties.
34
35
36 • Encouraging societal acceptance of transport through a tube.
37
38 • Developing alternatives for the “last mile” between the hyperloop station and final
39 destination.
40
41
42 • Convincing an entire ecosystem of insurers, construction companies, and transportation
43 companies to collaborate and reuse for sustainability rather than design and develop
44 from scratch.
45
46 • Developing and brokering licensing deals.
47
48
49 To execute on this work, a variety of organizational structures have been proposed over
50
51 time, with the latest shown in Figure 2. In this circular figure, the larger community of people
52
53 interested in the hyperloop provide the “talent pool” to staff “sprints” of short-duration. Sprints
54
55
56 are projects conducted within the purview of one or more specialty teams managed by “heads”
57
58
59
60
17
1
2
3 (also called hyperleaders) who are associated with one of six divisions in the company:
4
5
6 engineering, marketing, legal, operations, finance, and digital. There is a multi-person strategic
7
8 committee which generally does not engage in day-to-day activities, consisting of the CEO,
9
10 Chairman, and Chief of Global Operations.
11
12
13
-------------Insert Figure 2 about here -------------
14
15 There have been many conversations among HTT contributors about how all the work that
16
17 needs to be done should be divided into tasks. A variety of different approaches have been used
18
19
including the sprints described above, posting narrowly defined micro-tasks, announcements to
20
21
22 the community of broad sets of needs, and no announcements at all allowing community
23
24 members to do what they thought best. We outline below HTT’s labor division design in terms
25
26 of three insights: how tasks are designed and selected, how cross-task work is managed, and how
27
28
29 tasks are actually given to HTT from the external community.
30
31 How tasks are designed and selected. The current approach for those within the formal
32
33 contributor boundaries, where legal agreements have been signed and contributors are working
34
35
36
in exchange for stock options, is to design tasks and projects collaboratively. Tasks are
37
38 considered open-ended problems to be solved such that they require multiple perspectives, but
39
40 there is no agreement on the scope of a task. Some tasks are quite broadly scoped such as “CFD”
41
42
(run some computational fluid dynamics analysis) while others are quite narrowly scoped such
43
44
45 as: “take a look at this beta software and let us know about the user interface.” About a year
46
47 ago, several agile software consultants became contributors, bringing a partnership with the
48
49 Trello agile software product, and offered to help teams keep track of their task lists more
50
51
52 effectively on a Trello board. One of the learnings shared by the consultants was that the
53
54 definition of a task differed to a great extent between the teams.
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60
18
1
2
3 Each team is responsible for its own board. Teams can setup the board any way they like
4
and they can change their board any way they like. In general, a board should be setup
5
6 with a prioritized backlog list on the far left which the team can use to pull tasks from. To
7 the right of the backlog list are usually a blocked list, an in-progress list and a completed
8 list. Note that teams can add lists as appropriate for them. During each team meeting it is
9 important that each task on the board is discussed. Tasks should flow across the board to
10 the completed list. If tasks are not flowing, they are blocked or no work is being done or
11 the tasks are too large to complete and need to be decomposed. Hope this helps.
12
13
[Hyperleader on FB@W]
14
15 Contributors are encouraged to collaboratively suggest new tasks for their own teams, either
16
17 on the Trello board or on FB@W, as well as tasks that could be done by contributors not on their
18
19
own team, and listed on FB@W. Examples from FB@W include:
20
21
22 • Hey HTT..,we have an urgent video shoot at the Design Studio tomorrow. I need a few
23 able body folks to help me carry gear and help with general PA stuff. Please message
24 me ASAP.
25
26
• To anyone in the crowd: There is a Facebook at Work API for the social graph. Can
27
28 anyone from this wonderful crowd of ours help us with this?
29
30 • To the Energy storage team only, we need to identify potential partners for low-cost,
31 high-storage, and small batteries for energy storage.
32
33
For HTT, collaboratively suggesting or designing tasks means that once a suggestion has
34
35
36 been made, if someone is willing to respond to perform the task, then the task has been designed
37
38 and allocated! If the task takes more than 20 hours of someone’s time, then a “project” is created.
39
40 Example projects include: “Design the geometry of the capsule,” and “Develop a software
41
42
43 platform that creates routes from point A to point B with a variety of parameters specified.”
44
45 We were able to note several reasons why HTT evolved this approach to task division. First,
46
47 they found that narrowly defined micro-tasks often became obsolete within a matter of hours or
48
49
50
days in such a high-change environment. For example, a task of “having someone translate a
51
52 drawing into a 3-D CAD tool” changed when a new partner stepped in to offer a new 3D CAD
53
54 tool to use. Second, tasks that were too narrowly defined did not allow sufficient innovativeness
55
56
57
58
59
60
19
1
2
3 to provide both value to HTT and sufficient responsibility for contributors to take the time to
4
5
6 review the quality of their own work:
7
8 When I tried to precisely tell a contributing partner how I wanted the video to look, it
9 came out in a way I didn’t like it. Then I found a different contributing partner who is
10 more creative and we collaborated about the storyboard and they provided some real
11 strong creative input and the marketing video is much better [Chief Marketing Officer]
12
13
14 Not standardizing the meaning, scope, and definition of tasks seems to allow for much more
15
16 flexibility about requests for needs to be filled by the crowd. For example, in response to the
17
18 interview question: “What are your engineering needs?” responses were quite varied:
19
20
21 • specific skills (e.g., “ability to do dynamic flow analysis”),
22
23 • actions (“people to input CAD models”), and
24
25 • roles (e.g., “systems engineer”).
26
27
28 Moreover, this flexibility was embraced by the strategic committee since it allowed for the
29
30 creation of multiple competing projects! If contributors identified an approach to solving a
31
32 problem that was quite different from the approach being followed by an existing team, a new
33
34
35 team was created, competing against the existing team. This allowed for parallel exploration to
36
37 occur, leveraging both the abundant knowledge supply as well as the need to consider alternative
38
39 breakthroughs in an uncertain environment. Initially, contributors were taken aback by having
40
41
“to compete” within their own organization, but over time, the value of having multiple design
42
43
44 teams for various problems has proven itself as some approaches ended up providing a better
45
46 match to supplier and/or customer interests.
47
48 When announcements of new tasks are posted on FB@W, they are responded to extremely
49
50
51 quickly—often within an hour. For example, in the screenshot below (Figure 3), the original
52
53 request was made at 10:47am, with a response by 11AM!
54
55 ----Insert Figure 3 about here ----
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57
58
59
60
20
1
2
3 No one, even contributors assigned to a particular team, is directed to perform a task; the
4
5
6 tasks are just laid out (e.g., using a Trello board or FB@W or an email or a WhatsApp message)
7
8 and then contributors indicate their willingness to complete the task. Initially, contributors
9
10 assigned to a team were encouraged to only sign up for tasks within their own team. However,
11
12
13
that expectation has evolved so that both the executive team and hyperleaders no longer feel they
14
15 own the individual team members’ time. This enables any contributor to commit to any task that
16
17 is posted.
18
19
One consequence of allowing anyone to commit to any posted task is the surprises about
20
21
22 who commits to perform which tasks. For example, one member who originally joined HTT to
23
24 help teams adopt the agile development methodology, later contributed to engineering the
25
26 propulsion system. Why?
27
28
29 “Because I am interested in reducing road blocks across the design and I thought I might
30
31 have something to contribute.”
32
33 This openness to have work accomplished by unanticipated contributors is a prized aspect of
34
35
36
the catalyst nature of HTT. Hyperleaders and at least one member of each team are professional
37
38 specialists on the team’s topic (for example, the hyperleader for the capsule is someone who has
39
40 engineered fuselages for airplanes in the past and thus is extremely expert at designing capsules).
41
42
Consequently, if someone less expert on the topic is interested in joining the team, this is
43
44
45 welcomed. This diversity allows for the incorporation of new ideas and perspectives into the
46
47 design discussions, as illustrated in the example above with the agile development consultant
48
49 joining a propulsion system team.
50
51
52 This openness to pleasant surprises is particularly important given the interdependencies and
53
54 multi-dimensional aspects of the hyperloop technology and transportation ecosystem (e.g.,
55
56
57
58
59
60
21
1
2
3 political, technical, geographic, social, regulatory, financial, as well as engineering, project
4
5
6 management, risk reduction, and construction). The executive team and hyperleaders have
7
8 increasingly supported the need for unplanned cross-fertilization across teams and specialties:
9
10 Every tiny change in one area has implications for other areas. For example, if change in
11 size of door, this has implications for vacuum team, pod team, interior design, electrical,
12
13
mechanical, etc. [report by contributor on interviews with hyperleaders]
14
15 Consequently, managing the interdependencies across tasks has become a significant focus of the
16
17 organizational design.
18
19
Managing across tasks. HTT’s executive team envisioned early on to use agile project
20
21
22 management techniques (agilemanifesto.org), even though agile methods are generally used for
23
24 tasks which can be micro-managed such as standard software development rather than highly
25
26 interconnected, complex, and uncertain tasks (Dybå & Dingsøyr, 2008). They had hoped to
27
28
29 institute short three-week sprint tasks focused on an engineering design problem but found: “The
30
31 three-week sprints don’t work” [Co-Founder]. One reason for why they do not work appears to
32
33 be that it is difficult to define a do-able three-week sprint such the tasks are sufficiently
34
35
36
independent and require relatively little knowledge of what has transpired before the start of the
37
38 sprint. If the actors were full-time, the intensity of a three-week collaborative effort might be
39
40 feasible.
41
42
Instead of three-week sprints, contributors appear to prefer structured weekly
43
44
45 teleconferences so that they can plan their busy full-time, non-HTT, work schedules around one-
46
47 week sprints. During the teleconferences, contributors enjoy engaging in a collaborative design
48
49 effort, as well as discussions to identify engineering issues that need resolution, and alternatives
50
51
52 for resolution. They then volunteer to explore the alternatives over the course of the week before
53
54 the next teleconference. While the engineers tend to use FB@W to keep others informed of their
55
56
57
58
59
60
22
1
2
3 progress during the week, other parts of the organization, including the executive team do not,
4
5
6 preferring less open and more controlled communication tools of email, Slack (another internet-
7
8 based messaging system), and WhatsApp (a texting tool)
9
10 Tasks Given to HTT From External Community. Instead of tasks being defined by HTT
11
12
13
and assigned to the external community to perform, HTT does the opposite. The external
14
15 community of 30,000-50,000 on various social media sites frequently identifies tasks – as
16
17 opportunities - for the HTT executive team to perform. These tasks, as compiled from a series of
18
19
interviews with the Strategic Committee include:
20
21
22 • Specific opportunities for executive team members to speak at conferences about HTT.
23 For example, Gresta was invited to give a keynote speech to a global entrepreneur forum
24 in India, an invitation which was made possible by local people in India interested in
25 HTT. “It turned out to be about 14 people locally. We asked them to notify the media, and
26 then to help us make appointments with relevant government officials while we were
27
28
there. They did this because they would like a hyperloop in India; they didn’t receive
29 stock for their time.”
30
31 • Scheduling meetings for the HTT executive team with high-level government officials
32 including prime ministers and directors of transportation. An inquiry from a community
33 member about the possibility of meeting with officials in Toulouse, France led eventually
34
35
to the negotiation of a major hyperloop test track, land, and an R&D center situated in
36 the booming industrial park of Toulouse.
37
38 • Early-stage technology developments to be pursued for incorporation into hyperloop
39 development. The exclusive license which HTT is using to power its hyperloop started
40 with an inquiry posted by a community member.
41
42
43 • Suggestions for companies to partner with. Some of the companies that HTT is partnering
44 with today came about because someone in the community suggested that HTT contact
45 the company because the potential partner is doing some work that would be relevant to
46 HTT and, a partnership would result in mutually beneficial outcomes.
47
48
49
50 While only those speaking engagements that occur in a strategic area of interest are responded to,
51
52 most of the other inquiries are almost always at least initially examined.
53
54
55
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57
58
59
60
23
1
2
3 Integration of Effort
4
5
6 For Puranam et al. (2014), integration refers to how contributors are motivated and provided
7
8 the necessary information to perform their work in a coordinated fashion (see also Malone &
9
10 Crowston, 1994). We find that HTT integrates by using a variety of design elements, many of
11
12
13
which alone are not novel, but together help create a highly fluid organizational design. We
14
15 highlight these elements in Table 3, with examples from HTT’s approach to their talent pool,
16
17 culture, on-boarding and engagement practices.
18
19
Talent pool. Apparent from Figure 2 is the importance of the talent pool. The talent pool
20
21
22 refers not to people, but the relational networks, skills, passion, and commitment available to
23
24 HTT. The CMO has coined the phrase: “What we need are people who have Talent + Passion +
25
26 Responsibility” [emphasis from the original]. The larger external community provides talent in
27
28
29 the manner of tasking described above: of providing opportunities for introductions to CEOs,
30
31 investors, government officials, speaking engagements, and regulatory agencies. The smaller,
32
33 core crowd of contributors are those who have been on-boarded and signed the contractual stock
34
35
36
option agreement. These contributors – either as individuals or as representatives of partnering
37
38 organizations – are charged with executing on the opportunities provided by the larger
39
40 community. Such activities include designing the hyperloop and ancillary technologies, writing
41
42
proposals and marketing collateral, sharing design specifications back and forth with
43
44
45 collaborating companies, and providing the “boots on the ground” to accomplish feasibility
46
47 studies and testing. This requires professionals who feel responsible for the success of the
48
49 community, rather than just an organization. In the words of one member: “the people you meet
50
51
52 at HTT are absolutely amazing: smart, hard-working, committed, creative, fun, and passionate—
53
54 just the people I love to hang around with online and off.”
55
56
57
58
59
60
24
1
2
3 There has been no problem in obtaining resumes. Estimates from the CEO, Chief Operating
4
5
6 Officer, and Human Resources Director, indicate an average of 100 resumes are submitted every
7
8 week, either via LinkedIn or to one of the company’s websites. There are triggers that tend to
9
10 spark an influx of resumes: Executive speaking engagements, recruiters/contributors who look
11
12
13
for specific talent defined by the executives, and advertisements on online job markets such as
14
15 AngelList. The challenge comes in matching the resumes to HTT’s organization culture and the
16
17 available opportunities.
18
19
Culture. Over time, HTT contributors helped to create the company’s mission and values
20
21
22 statements, as shown in Figure 4.
23
24 -----Insert Figure 4 about here -----
25
26 The vision of moving humanity forward is meant to signify that HTT is concerned first and
27
28
29 foremost with the passenger, not with the technology or stock market or investor value.
30
31 Delivering the next breakthrough is intentionally chosen to indicate that HTT is a technology
32
33 licensing company, intent on continuing to develop technologies associated with, and ancillary
34
35
36
to, the hyperloop. The core values emphasize the nature of the people they want in the
37
38 organization; people who don’t “sit on the sidelines but instead make things happen,” take
39
40 responsibility for professionalism in their work, don’t just dream but engage in doing, recognize
41
42
that HTT is a passionate movement rather than just a company, and solve problems that require a
43
44
45 vision of tomorrow and collaboration today. We summarize the culture these statements
46
47 exemplify into four essential elements: 1) being extremely collaborative when disruptive, 2)
48
49 being willing to take the initiative without knowing if it will bear fruit for the organization or
50
51
52 oneself, 3) working as part of a proliferating potpourri of largely self-governing teams with
53
54 uncertain interdependent elements between the teams, and 4) knowing how to catalyze others to
55
56
57
58
59
60
25
1
2
3 perform tasks in a context in which many tasks are self-selected. This four-part culture is a direct
4
5
6 function of the environment in which HTT operates.
7
8 The first element—intense collaborative disruption—is needed as a check-and-balance on
9
10 disruptive ideas. If one contributor offers an idea that is too disruptive for the organization, the
11
12
13
collaboration required to bring that idea to fruition will help to smooth out some of the
14
15 disruptiveness of the idea. The following example of intense collaborative disruption comes from
16
17 a series of interactions via FB@W between the first author and the Hyperleader responsible for
18
19
Engineering Integration:
20
21
22 One contributor interested in organizational design suggested that the engineering
23 department be reorganized into project management and R&D so that those
24 engineers interested in project management could be engaged in that discipline
25 and those interested in R&D could be engaged in the R&D activities. Since several
26 engineering hyperleaders agreed, plans were made to disrupt the organization to
27
make the change. Then, unexpectedly, an opportunity surfaced to conduct a
28
29 hyperloop feasibility study for a government. During the feasibility study, both
30 project management and R&D engineering became quite intertwined, making it
31 clear that such a bifurcation of engineering would not have been a good idea.
32 Consequently, the idea was not pursued further.
33
34 The second cultural element—being willing to take initiative without knowing if it will bear
35
36
37 fruit for the organization or oneself—is needed since there are so many uncertainties and the
38
39 organization must be responsive to changes in market and technology conditions, that an
40
41 initiative which seems worthy at one point, may no longer be needed at another and vice versa.
42
43
44 The first author compiled the following example over several months based on initial
45
46 engineering design meetings, and then repeated interviews with several members of the
47
48 engineering team over time.
49
50
The engineering R&D team took the initiative to develop the hyperloop design
51
52 on the assumption that the capsule will be run through concrete tubes because
53 ultimately there would not be enough steel to create all the tubes in the world.
54 The engineers spent considerable time analyzing the safety, risk, cost and
55 feasibility of concrete tubes under varying environmental conditions. Most
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26
1
2
3 recently, the CEO announced the completion of a successful negotiation with
4
a steel company in Spain to deliver steel tubes to Toulouse in exchange for
5
6 stock options. The R&D engineers had to be willing to immediately pivot to
7 consider the possibility that sometimes the tube will be built in steel and other
8 times will be built with concrete.
9
10 Since the hyperloop design is intended to be a “glocal” technology customizable to each
11
12
13
nation and thus a platform spawning a pluralistic suite of products, the R&D efforts for the
14
15 concrete tube may be useful later. Initially, the ability to embrace such pivoting was a difficult
16
17 cultural element for many HTT contributors since it often meant that their most recent work felt
18
19
unappreciated.
20
21
22 The third cultural component— working as part of a proliferating potpourri of largely self-
23
24 governing teams with uncertain interdependent elements between the teams —is needed because
25
26 there are so many interdependent components of the hyperloop transportation industry still under
27
28
29 development. Below, two examples illustrate this cultural component:
30
31 • Safety regulations for the hyperloop are being developed as technologies are being
32 developed and as estimates of risk are being developed. Since there is no experience
33 of a vacuum-sealed tube transporting passengers at high speed, analogs to high-
34
speed rail and airplanes are often used. Therefore, engineers on the safety team are
35
36 often interfacing with the regulatory team. [compiled from interviews with the Safety
37 Hyperleader]
38
39 • Passenger Experience. The paramount emphasis on passenger experience permeates
40 most aspects of the design. Some of the basic passenger experience principles being
41
pursued include completely electronic and seamless experience with the passenger’s
42
43
“time never wasted” [Gresta]. Therefore, capsules need to be designed not just for
44 comfort but various passenger use cases from working to purchasing. Such a capsule
45 design affects the way seats are oriented. The orientation of seats affects the speed of
46 egress and ingress into the capsule. Designing the station for a 10-second time
47 window between capsules coming in and leaving the station is affected by this speed
48 of egress/ingress. If capsules are leaving every 10 seconds, do passengers even need
49
tickets in advance? If passengers are using non-hyperloop means to arrive at the
50
51 station (such as Uber or Lyft), is there a way to integrate with these others to allow a
52 seamless enriched journey from the time of thinking about a trip to the time of travel,
53 and thinking about the next trip? [compiled from interviews with Station Team
54 member and co-founder Gresta]
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27
1
2
3 These interdependencies are not unusual in complex engineering efforts. To handle the
4
5
6 interdependencies, integration standards are often created, specifying design assumptions such as
7
8 the weight, speed, or energy load allowed (see Boeing 777, for example, Thomke and Fujimoto
9
10 2000). However, with HTT, enforcement of integration standards may remove a market
11
12
13
opportunity. So, every team must design to assumptions about what might be feasible integration
14
15 standards. This can cause frustration. In the words of one engineering contributor:
16
17 If we don’t know details about this component, we cannot make certain design
18 assumptions, and unless we can make these design assumptions, we cannot move forward
19
with the design of other components.
20
21
22 However, instead of enforcing integration standards, the executive team repeatedly responded to
23
24 these frustrations by encouraging the engineers to move forward in designing to the very general
25
26 specifications of the hyperloop, but not to be constrained by integration standards. This
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29 approach, while unusual for engineering, has allowed HTT to be quite flexible in quickly
30
31 meeting different client requires for feasibility proposals. In other words, each client creates its
32
33 own requirements which force temporary integration standards, which then lead to rapidly
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36
configuring the more general design for the specific client, as a form of just-in-time engineering.
37
38 The fourth cultural element—knowing how to catalyze others to perform tasks in a context
39
40 in which many tasks are self-selected—is needed because the company’s talent pool is not
41
42
required to perform any specific task. The Chief Marketing Officer notes:
43
44
45 This is a very important element in our organization. The traditional carrot/stick model
46 does not work. How do we keep our contributors and community enthused? How do you
47 ensure there's a sense of purpose and responsibility?
48
49 Even though contributors receive stock options in exchange for the work, they exhibit a
50
51
52 substantial amount of free will in self-selecting contributions and tasks to perform. The self-
53
54 selection nature of the contributions means that contributors often need to be sold on the personal
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1
2
3 value of a task and the value of the task for the organization. A compilation of posts on FB@W
4
5
6 provide two illustrate examples of the need to catalyze others to accept tasks:
7
8 • On FB@W, requests were made repeatedly for individuals to contribute to a central
9 project management document. Few responded. However, once an upcoming
10 feasibility study was announced and the connection to the central project
11
management document was made explicit, contributors quickly added their work to
12
13 the document.
14
15 • On FB@W, contributors often post media reports about competitors. At one point, a
16 contributor posted a media report announcing a successful public test of a hyperloop
17 component by a competitor. Over a several day period, contributors shared on
18
FB@W and during weekly teleconferences and emails concerns about the
19
20
implications for HTT’s success in such a competitive marketplace. Finally, the CEO
21 posted on FB@W a message indicating the downsides of the competitor’s technology
22 and explained how HTT was still ahead of the competitor. This post helped to
23 redirect the contributors back to focusing on the work, rather than discussing the
24 competition.
25
26
The posting of new tasks has, therefore, increasingly been accompanied by a justification
27
28
29 of the need for the task. Clearly, tasks requested by the CEO or Chief Global Operations Officer
30
31 are more likely to be self-selected, but since tasks can be suggested by anyone at any time in
32
33 response to any opportunity, the importance of justification for catalyzing others to engage in
34
35
36 posted tasks has now become part of the culture.
37
38 Onboarding. Hiring and onboarding at HTT are challenging because professional specialists
39
40 need to be collaboratively disruptive, willing to offer new projects, and spend time selling
41
42
43
projects to others. Once an HR director was hired by HTT, attention was placed on ensuring that
44
45 recruiting, screening, and onboarding were identifying people to sign the contributor agreement
46
47 who represented the best fit. An example of how the application and onboarding process evolved
48
49
is described below based on a compilation of observations of the changes in the onboarding site
50
51
52 over time, and interviews with the HR director:
53
54 The application process has evolved from requesting resumes to coupling
55 resumes with short answers about the precise nature of the contribution the
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29
1
2
3 contributor wants to make and why the contributor believes she can work in
4
such an environment. Once hired, the new hire self-certifies through an
5
6 online self-guided process of reading about the company and its culture. The
7 new hire is then assigned to a hyperleader who is asked to monitor the new
8 hire’s behavior and offer mentoring.
9
10 Keeping contributors engaged. Once hired and assigned to a hyperleader, new contributors
11
12
13
often look for guidance rather than jumping on a task described in a teleconference.
14
15 Consequently, as more contributors come onboard, hyperleaders (many of whom are 10-hour a
16
17 week contributors) have the increasing responsibility for not just meeting milestones in their
18
19
functional discipline (marketing, human resources, engineering, etc.), but also for assigning tasks
20
21
22 to new hires. Often these tasks require training—on HTT’s tools, current design state and
23
24 assumptions, HTT’s culture, and the proper network of other contributors to ask questions. This
25
26 takes time. There is some discussion as to whether hyperleaders need to become full-time to
27
28
29 manage contributors, but there is also acknowledgment that this might come at a cost of losing
30
31 hyperleaders who can only work part-time (given many of them are employed full-time in
32
33 traditional organizations).
34
35
36
Standards and procedures. Since HTT’s mission is to collaboratively disrupt by catalyzing
37
38 change, HTT provides incentives for collaborative disruption in a variety of ways: converting
39
40 part-time contributors to full-time paid staff if desired, publicly recognizing collaborative work
41
42
well-done and achievements that are good for the larger organization, and encouraging
43
44
45 contributors to take initiative to design the organization as they would like to see it work, rather
46
47 than looking to senior management as drivers of organizational change.
48
49 Designing procedures for an organization like HTT is not simple. Standardization is difficult
50
51
52 because each person is working with the language of their own tools, country, business, and
53
54 discipline, and sometimes substantially different views of what a new transportation system
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30
1
2
3 might look like. All this variation means that processes and procedures need to be more of
4
5
6 “guardrails,” a term used in agile project management (e.g., Sutherland & Sutherland, 2014)
7
8 rather than rigid ways of working. Creating guardrails that are acceptable to others takes time
9
10 (and the attention of the Cultural Director and the head of HR). This means procedures such as
11
12
13
certain reporting guardrails about how much time contributors should spend on a task in
14
15 exchange for a stock option have taken longer to create, waiting for sufficient socialization
16
17 among contributors. Despite the guardrail indicating that FB@W should be used for
18
19
collaboration, FB@W is still minimally used by the executive team, marketing, and business
20
21
22 development. This allowance of personal preferences in performing the work is part of this
23
24 concept of collaborative disruption: if others are not ready, then it will not happen.
25
26 DISCUSSION
27
28
29 In this paper, we set out to describe how an organization could manage, and even gain from,
30
31 uncertainty by deploying an organizational design that leverages an environment of near-zero
32
33 information cost. We described how HTT learned to design itself to accomplish its broad mission
34
35
36
of creating a movement for sustainable transportation. The primary contribution of our paper is
37
38 hence HTT itself; an organization that operates as a crowd-sourced ecosystem capable of
39
40 proactively leading and reacting to the development of new technology and ecosystems. We
41
42
label HTT a “catalyst organization” because it serves as a platform to catalyze new technologies,
43
44
45 new business connections among contributors, and the creation of a new market and ecosystem.
46
47 It is the largest crowd-sourced startup, with a community of followers numbering over 50,000.
48
49 The many contracts it has acquired and the state of its development—accomplished primarily
50
51
52 with the labor of part-time professionals in exchange for stock options—is unprecedented. Next,
53
54 we summarize the core aspects of this novel organization design and then derive implications for
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31
1
2
3 theory and practice in research on search, organization design, and communities.
4
5
6 The Catalyst Organization: A Novel Organization Design for Innovative Search
7
8 As argued by Puranam et al. (2014), many of the emerging organizational designs are simply
9
10 novel bundles of old solutions to age-old challenges of organizational design. We believe HTT is
11
12
13
more than that. First, the age-old challenges are based on a notion of efficient operations (which
14
15 drives the need to differentiate by task and then hierarchically or laterally integrate). But, in a
16
17 context of near-zero cost external knowledge supply, efficiency is a less important driver of
18
19
design. Second, the distinctions of the five challenges presume their value for analyzing new
20
21
22 organizational form and yet the interdependencies among the five challenges suggest that new
23
24 sets of challenges may better capture the realities of the catalyst organization. Third, the classic
25
26 design solutions to differentiation and integration - which fundamentally focus on achieving
27
28
29 organizational goals through a hierarchy defining tasks, rewards, and information flow - places
30
31 people in a responsive passive role. But, under conditions of such significant market and
32
33 technological uncertainty, coupled with a virtually infinite potential supply of external
34
35
36
knowledge, people’s choices to make offerings to the firm become much more of the defining
37
38 role in the design.
39
40 The resources people can offer HTT are not just knowledge, but range from networks to
41
42
hardware supplies, from time to attention, from existing skills to willingness to learn new skills.
43
44
45 This creates an ever-changing structure, hierarchy, and workforce. The stability comes from the
46
47 firm having a clear vision developed not by the founder but by a flow of contributors having
48
49 frequent catalyzing experiences, a volume of opportunities presenting themselves, a volume of
50
51
52 people offering their resources, a number of commons for sharing resource needs and
53
54 availability, and crossable layers of commitment levels so that the organization and contributors
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32
1
2
3 can adjust to changing demands.
4
5
6 This new form is therefore not based on the design solutions to the differentiation and
7
8 integration challenges. It is neither promoted 1) classically as tasks being divided and allocated,
9
10 and hierarchy integrating across the task divisions, nor 2) aligned with current views of emerging
11
12
13
designs as self-organizing. A classic differentiation and integration design would create too
14
15 much filtering and delays in the ability to quickly and proactively engage in the huge range of
16
17 unforeseen opportunities presented by an uncertain environment, as well as capture unforeseen
18
19
offerings of passion, resources, skill, and time from the low-cost supply of external knowledge.
20
21
22 A pure self-organizing design with standardized practices such as used with Wikipedia also
23
24 would not work because the process for achieving the mission is too unpredictable.
25
26 Therefore, we suggest a new organizational form – which we refer to as a catalyst
27
28
29 organization – which is needed explicitly because the intention of the organization is to engage
30
31 as many opportunities as possible across a broad uncertain and evolving market and technology
32
33 landscape using an abundant supply of external knowledge and resources available at a low-cost.
34
35
36
At the most fundamental level, this new organizational form (1) uses non-modular task division
37
38 and allocation to create limitless options, and (2) integrates work in a manner that allows for
39
40 continuous exploration even in the face of the need to produce. It is these differences which
41
42
allow HTT to operate effectively at the intersection of environmental uncertainty and potential
43
44
45 engagement from an almost limitless community of contributors.
46
47 As we show in Table 4 below, HTT also differs from Fjeldstad et al.’s (2012) actor-oriented
48
49 organization design. Apparent in this comparison is that HTT is not easily characterized as
50
51
52 exclusively an actor-oriented design, although it has elements of such a design. Instead of
53
54 decomposing tasks, there is a substantial amount of opportunity-to-available resource matching
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33
1
2
3 distinctions that surface as projects unfold, and in which the distinctions are not simply in
4
5
6 different types of skills, but also in different levels of commitment, different objects of passion,
7
8 and non-overlapping relational networks that can be brought to bear. Instead of direct control and
9
10 exchange, there is an attempt at orchestration that is not done by any single conductor, but rather
11
12
13
by those committed to completing a project. Instead of standardized protocols, there are
14
15 “guardrails” allowing individuals substantial discretion within broad direction. Instead of basing
16
17 coordination on dynamic lateral relationships, there are multiple different coordination
18
19
mechanisms in use at the same time. In sum, the novelty of HTT’s catalyst organization design
20
21
22 may be most easily understood when described as a passion-driven, dynamic movement
23
24 organized to create and capture an almost unlimited supply of unanticipatable opportunities
25
26 through the supply of low-cost and highly specialized knowledge. While Wikipedia and open
27
28
29 source development projects are movements, their organizations are not intended to create
30
31 unanticipatable opportunities. While Oticon (Foss, 2003), Blade.com (Fjeldstad et al., 2012), and
32
33 R&D teams (Ben-Menaham et al., 2016) are organizations looking for opportunities, they are not
34
35
36
drawing on the contributions of external actors.
37
38 ----Insert Table 4 About Here ------
39
40 HTT stands out even when examined in the logic of real options where a few technological
41
42
pathways are explored in parallel (Adner & Levinthal, 2008; Gruber, MacMillan, & Thompson,
43
44
45 2013). Given the abundance of potential contributors, in principle, HTT can explore a sheer
46
47 limitless amount of parallel ideas, as long as there are individuals interested in executing them.
48
49 At the same time, this dynamic mandates that HTT not prescribe the precise way in which things
50
51
52 are done. Put differently, HTT cannot dictate a modular task division because it cannot precisely
53
54 predict what the right task division is (Reetz & MacAulay, 2017). In addition, modularization in
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60
34
1
2
3 the hope for skill-matched self-selection should also not be an aim, as it is not foreseeable
4
5
6 precisely which talents will be required. Rather, HTT can be continuously informed about
7
8 potential avenues for further development when contributors decide to embark on them, or when
9
10 new knowledge enters the organization through its many connections to the outside world.
11
12
13
To integrate these dispersed external contributions, the catalyst design needs to incentivize
14
15 as well as react to discoveries which may fundamentally alter the way HTT should operate. HTT
16
17 seems to have set up a structure which is continuously able to adapt. The work, and who does it,
18
19
is emergent. Given uncertainty, it is important that a continuous process of discovery and
20
21
22 disruption is kept in motion. By providing team- and community-level incentives, and by
23
24 relegating information dependencies to the team level, HTT can foster diversity in the
25
26 explorative efforts undertaken. The large amount of available slack (interested contributors)
27
28
29 sustains these efforts. Furthermore, HTT explicitly reminds contributors that “we all are
30
31 disrupters” -- contributors are constantly challenged, and evaluated on, their ability to generate
32
33 new proposals and suggestions for implementation. A Cultural Director, who has taken on a role
34
35
36
of sharing to all HTT contributors descriptions of other companies known for disruptions,
37
38 facilitates this. At the same time, the relatively stable onion structure and the official cultural
39
40 guardrails ensure that some control/agency over the development and integration is kept by HTT.
41
42
We think that the catalyst organization may become a template to create organization
43
44
45 designs for contexts like HTT’s: where uncertainty is high and systemic, and for which a large
46
47 contributor base can be activated at near zero knowledge acquisition costs. For example, such a
48
49 design may prove fruitful for organizations tackling wicked problems (e.g., Rittel & Webber,
50
51
52 1973) or grand societal challenges (e.g., George, Howard-Grenville, Joshi, & Tihanyi, 2016),
53
54 which will also feature difficult-to-foresee interdependencies as well as large communities of
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35
1
2
3 potential contributors.
4
5
6 At the same time, we do not claim that the catalyst organization is an optimal organization
7
8 design. Rather, we suggest that is well-functioning in the setting we have identified, and call for
9
10 future research to identify not only (in line with our above suggestions) other settings in which
11
12
13
this design may be suitable, but also to inquire more generally which shifting boundary
14
15 conditions (see also: Gulati et al., 2012) would impact the efficacy of this model.
16
17 Implications for Theories of Organization Design
18
19
HTT’s non-modularity of task division may have implications for work on organization
20
21
22 design more broadly than the description of a new organizational form. If it is true that we are
23
24 moving toward a gig economy (see: Barley et al., 2017), where a temporary workforce with, at
25
26 best, weak organizational affiliation or commitment assumes temporary responsibility for tasks,
27
28
29 task division becomes the pivotal point of contact. So far, as we have noted, the literature on
30
31 organization design argues that modularity is essential to engage volunteers (Afuah & Tucci,
32
33 2012; MacCormack et al., 2006). Yet, as observers of organizational design, we must remind
34
35
36
ourselves of the equally well-known research showing that broader job responsibilities lead to
37
38 more perceived meaningfulness in work (Hackman & Oldham, 1980) and job satisfaction
39
40 (Wood, Veldhoven, Croon, & De Menezes, 2012). Broader job responsibilities may also be
41
42
aligned with the preferences of millennials (Ng & McGinnis, 2015). Therefore, research on
43
44
45 organization design will need to consider not just the design of the organization, but the design
46
47 and meaningfulness of the broader ecosystem. That is, instead of thinking of organization design
48
49 as focused on tasks as requirements for individual or group performance, our understanding may
50
51
52 be deepened if volunteers could not just pick from a set of well-defined tasks, but even partake in
53
54 designing and redesigning the tasks themselves as conditions and contexts change (Oldham &
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36
1
2
3 Hackman 2010).
4
5
6 HTT’s form of integration—to focus on time, skills, commitments, actions, and passion of
7
8 people to disrupt, learn, and instill learning in others – instead of coordinate, control (Fjeldstad et
9
10 al. 2012), and execute tasks —may increasingly be expected of 21st century organizations.
11
12
13
Instead of having funding rounds, we might foresee that 21st century organizations such as HTT
14
15 have talent and commitment layers and rounds (Applegate, Griffith, & Majchrzak, 2017), where
16
17 people can shift from active to inactive, from inactive to active, from not involved to onboarding,
18
19
from a community fan to active business opportunity creator. The challenge then is not growth in
20
21
22 a traditional sense of resource spending, or even talent acquisition, but rather catalyzing new
23
24 “bundles of energy” willing to dialectically engage with others, act rather than “sit on the
25
26 sidelines,” demonstrate passionate professionalism in everything that is done, bring personal
27
28
29 networks of relationships and resources to bear, learn new skills, and collaboratively disrupt the
30
31 world. In turn, this could become a fertile ground to use ideas generated in the context of catalyst
32
33 organizations to study the boundary conditions of traditional organizations.
34
35
36
Implications for Theories of Exploration
37
38 Classic perspectives on exploration (e.g., Simon, 1973) usually still assume organizations
39
40 and tasks to be structured around decomposable goals (Clement & Puranam, 2017; Puranam &
41
42
Swamy, 2016). While this may be true if the set of all eventual tasks is known a priori, when this
43
44
45 is not the case and tasks are modularized too early, the organization may end up exploring in the
46
47 wrong places (Dattée et al., 2017).
48
49 Flexibility then is needed both in how exploration is carried out and how to evaluate the
50
51
52 results. The specter of unlimited and broad contributors provides the ability to use contributors to
53
54 define and conduct the exploration, as well as evaluate options received. Essentially, the catalyst
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60
37
1
2
3 organization is maximizing structural ambidexterity (e.g., Tushman & O’Reilly, 1996) down to
4
5
6 the level of the individual opportunity and unique skill, since a sheer limitless number of real
7
8 options can be explored in parallel. Consequently, a catalyst organization offers an alternative to
9
10 one of the central premises of Afuah and Tucci (2012) about when a firm should engage in
11
12
13
crowdsourcing. Afuah and Tucci argue that crowdsourcing requires modularization so that
14
15 specialized actors can use their local search knowledge. Similarly, MacCormack, et al. (2006)
16
17 highlight how the open source project Mozilla, the organization behind the Firefox browser, only
18
19
took off after being modularized so that potential volunteers could identify more “chunk-size”
20
21
22 contributions. The alternative presented by the HTT case is that, given a sufficiently large and
23
24 diverse contributor base encouraged to collaboratively engage in the design as well as the
25
26 accomplishment of work, non-modularization will lead contributors to explore more broadly as
27
28
29 their worldviews collide with other worldviews—a likely prerequisite for successful explorations
30
31 under high uncertainty (Dattée et al., 2017; Santos & Eisenhardt, 2009).
32
33 Implications for such a design on organizational design scholarship are many. We know
34
35
36
little about collaborative exploration behavior. What is the process by which seekers and solvers
37
38 co-define an exploration need to ensure disruptive thought? How are alternatives evaluated when
39
40 generated from collaborative exploration? How is the decision to stop exploring made?
41
42
Implications for Theories of Communities
43
44
45 The HTT case highlights how communities and formal organizations (with senior managers
46
47 and bounded legal status) are increasingly merging given zero information costs and
48
49 environmental uncertainty. Given high uncertainty, it is unclear who forms today’s periphery of
50
51
52 the community, and whether the notion of a periphery of a community even makes sense
53
54 anymore. With uncertainty comes the need for shifting roles, in a manner like HTT’s, where
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38
1
2
3 contributors can select which roles to play in the onion structure, playing multiple roles across
4
5
6 boundaries at the same time. Also, contributors not yet involved with the organization need to be
7
8 considered, given their potential relevance if the organization were to change. This is necessary
9
10 to avoid developing path-dependencies that would prematurely include or exclude specific
11
12
13
subgroups.
14
15 There is also the question of the value that catalyst organizations add to the community.
16
17 HTT is an example of a collaborative organization rooted in a desire to reuse existing resources
18
19
among contributors rather than reinventing new resources. Unlike research on collaborative
20
21
22 organizations (Fjeldstad et al., 2012; Snow, Håkonsson, & Obel, 2016), HTT seems to suggest
23
24 that a central organization is needed to help catalyze a larger contributor community. The
25
26 catalyst is not the supervisor of the contributor, but how the organization provides the
27
28
29 contributors a virtual room in which to meet, become stimulated by other’s work, make new
30
31 connections, and become energized in the talent and skills contributors have and how they can
32
33 use them for worthwhile purposes. Research questions are many, however. Why, for example,
34
35
36
has the notion of a hyperloop stimulated such world-wide attention? Is there a “cool factor” that
37
38 defines successful and less successfully sustained communities? Does this mean that apparently
39
40 mundane problems, like reducing mosquitos, will not be able to sustain their communities? Do
41
42
catalyst organizations redefine benefits for contributors such that contributors may be able to
43
44
45 receive no payment, no recognition, and no physical evidence of involvement purely in exchange
46
47 for the glow of being listened to?
48
49 Implications for Practice
50
51
52 Dirk Ahlborn and Bibop Gresta, HTT’s co-founders, have spent the last four years
53
54 attempting to convince CEOs, investors, and customers to adopt HTT’s organization design.
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60
39
1
2
3 They encourage executives to help employees gain an ecosystem orientation to work. They argue
4
5
6 that everyone has the potential to offer ideas and business opportunities, that boundaries around
7
8 organizations are simply mind games rather than realities, and that any product today is simply a
9
10 product on its way to obsolescence. While it may take a village to raise a child, it increasingly
11
12
13
takes worldwide communities to make societal change.
14
15 Limitations and Suggestions for Future Research
16
17 Our case of HTT, while offering exciting insights, also has limitations. We see both direct
18
19
next steps for future research and opportunities for these ideas to inform other streams of
20
21
22 research. Validation of the catalyst organizational form, and its generalizability, is of the essence.
23
24 While we identified many organizations similar to HTT on one or several dimensions (see Table
25
26 2), we could not find another organization that was the same on all of them. Future research
27
28
29 should strive to find and assess organizations with parallel dimensions to HTT to better
30
31 understand the interdependencies we found here. Additionally, it is crucial to study the
32
33 conditions under which organizations with a similar purpose (but different design) could be more
34
35
36
efficacious than HTT, and vice versa.
37
38 The context provided both strength and limitations. HTT is not simply building software (as
39
40 in open source), knowledge (as in Wikipedia), t-shirts (as in Threadless), or a one-off innovation
41
42
challenge such as promoted by InnoCentive, but rather an entire industry supporting the creation,
43
44
45 implementation, and ongoing service of self-sustaining public transportation. This makes HTT
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47 unique among new organizational forms. The broad nature of the goals gives us confidence that
48
49 it is not the digital nature of the product which is driving the effects we are observing.
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52 Consequently, our findings may translate broadly to other industries that are capital-intensive
53
54 and/or high in the importance of complementary assets. We do, however, acknowledge that it
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3 may be precisely because HTT is not just building a product, but rather an entire industry
4
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6 ecosystem which may create one-time effects which could influence our results.
7
8 Finally, our findings give a renewed impetus for research trying to identify “new” forms of
9
10 organizing (Dunbar & Starbuck, 2006; Greenwood & Miller, 2010; Walsh, Meyer, &
11
12
13
Schoonhoven, 2006; Puranam et al., 2014). Indeed, our results highlight that new organizational
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15 forms emerge as traditional distinctions between task division and integration become
16
17 increasingly less important than the nuances of how work gets done. We see the HTT example
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19
challenging assumptions held in our theories, and pushing their boundary conditions.
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3 Table 1:
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Sources of Data
6 Format Source Focus of Content
7 Interviews Hyperleaders (i.e., team heads) for engineering design: Why participants joined, how they learned about HTT, goals they
8 Design Execution, Engineering Integration, Systems hoped to accomplish, roles played in the organization, changes
9 Structure, Pylon Design, Tube Design, Demonstration seen in the organization since joining, and background on the
10 Project, Pod Design reasons for changes.
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Hyperleaders for non-technical design: Marketing,
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Human Resources, Culture, Animation, Business
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Development, Media, Global Operations, Strategic
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partnerships
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18 Interviews CEO, COO Strategic vision, cultural values, expectations, progress
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Organization documents On-boarding website, contributor agreement, press Changes experienced by the organization over the 18 months
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releases, press descriptions of HTT, organization chart,
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HTT executive summary
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23 Engineering documents Design drawings, system architecture, design Reconfigurations of teams in terms of responsibilities and tasks
24 assumptions, project management documents, risk
25 assessments, scope of work, requests for information
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Observations of Listened to 80 engineering related meetings, each lasting Changes to how engineering is organized and reasons
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teleconference meetings between 45 - 120 minutes
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29 Observations of posts Reviewing the 4000 posts to the collaboration Focused primarily on comments related to changes in organization
30 on the collaboration technology, including events, group descriptions, likes, design, and changes to the how the technology is used by
31 technology chat messages, comments, replies, and votes members
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3 Table 2:
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Comparing Crowd-based Approaches to Innovation
6 Characteristic Knowledge Production Innovation Two-Sided Crowds: Open Source Software: Catalyst Organization:
7 of organizing Crowdsourcing: Wikipedia tournaments: Threadless Linux HTT
8 NASA Solve
9 Purpose Give every single person on Engage the public in Design fashionable t- Develop free and Change the world
10 the planet free access to the NASA innovation shirts accessible software and produce corporate
11 sum of all human knowledge. revenue
12 Problem Clarity Clearly stated; no room for Clearly stated; Clearly stated; Clearly stated Broadly stated,
13 & Ambiguity of interpretation: “Write an interpretation within interpretation within interpretation within interpretation within
14 Solution encyclopedia that is modelled strict boundaries: “Solve strict boundaries: strict boundaries: fuzzy boundaries:
15 after the Encyclopedia a [specific] technical “Create a t-shirt print.” “Program lines of code “Develop a low-pressure
16 Britannica.” problem in space flight.” that provide a specific tube transportation
17 function.” system.”
18 Task Division No centralized task division. NASA and their Artists submit designs; Founder provides layer 1 Broad descriptions of
19 governmental partners communities score architecture; visible to tasks
20 create the challenges designs everyone
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22 Task Allocation Self-selection (based on Self-selection (based on Self-selection (based on Self-selection (based on Self-selection into
23 preferences) into articles skills and preferences) skills and preferences) skills and preferences) extended membership
24 into contests into design submission, into coding, bug fixing, pool. After vetting, self-
25 feedback, and/or voting support selection into tasks
26 Motivation Intrinsic motivation, Mainly prizes, status, and Artists: learning, status, Universal free access to Stock options, passion,
27 (Reward visibility within community signalling signalling, community. OSS; learning, status, intrinsic motivation
28 Distribution) Community: access to signalling, community
29 unique goods &
30 engagement
31 Coordination Through “talk page” When outcomes are Crowds and artists Comments, forums; Guardrails, socialized
32 (Information shared vote, see votes and source code control, collaborative
33 Provision) feedback technology
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35 Exception Lateral authority for articles. None (problems are one- Lateral authority for Founder-led hierarchy Collaborative decision-
36 Management Structural decisions by firm shot games) challenges. Structural for key tasks; lateral making on what is
37 decisions by firm authority for crowd work explored.
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44 .
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3 Table 3:
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HTT Case Description
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7
8 Organizational Design Challenge HTT’s Characteristic Features
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11 Division of Labor: Task Division, • Holistic, less modularized tasks
12 Allocation, and Execution • Mutual agreement on task assignment
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• Tasks related to entire ecosystem
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15 • Task performers come from entire ecosystem
16 • Multiple competing tasks
17 • Use of one-week sprints for task completion
18 • No pre-defined task-skill matching but instead
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ensuring range of skills within talent pool
21 • Tasks are often duplicated to get competing
22 viewpoints
23 • Tasks include environmental scanning by
24 contributors providing the organization with
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opportunity to pivot quickly
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27 • Community-driven micro tasks given to HTT
28 management
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30 Integration of Effort: Motivating • Contributors work for future stock options &
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Contributors, Coordination, guarantee minimum 10 hrs/week
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33 Collaboration, and Control • Cultural guardrails encouraging disruption and
34 collaboration & movement and membership
35 rather than tasks and individual ideas
36 • Socialized control methods through collaboration
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• Use of technology for socialization, coordination
39 & collaboration
40 • Part-time managers
41 • Control through parallel paths to see which path
42 is more fruitful
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• Tools for collaboration
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3 Table 4:
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6 Comparison of Catalyst Organization HTT vs. Actor-Oriented Architecture
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8 HTT – Catalyst Organization Actor-Oriented Architecture
9 (examples from Fjeldstad et al.,
10 2012)
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Organizational design is a combination of Organizational design is focused on
12
13 hierarchy, bottom-up information flows, and dynamic lateral networks of
14 networks relationships
15 Hierarchy used for orchestration, not control or Direct exchange (rather than
16 coordination. Work is prioritized based on what hierarchical planning, etc.) among
17 people and skills are present. the actors leads to control and
18 coordination
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20 Goals are not determined through control but “Control is the determination of
21 through the direct exchange among the goals, the allocation of resources to
22 contributors to match opportunities and pursue them, and the monitoring of
23 knowledge, problems and solutions, needed goal fulfillment and resource use.”
24 actions and available free time, roles and p. 746
25 commitments.
26
27 Matching of talent to goal by identifying Decomposing tasks
28 niches/distinctions across people in available time,
29 passion, knowledge, resources and identifying
30 distinctions in work across time, tacit knowledge
31 required, and resources needed
32
Some decisions handled hierarchically, some Lateral nature of decisions regarding
33
34 handled by default from lack of resources; division projects to pursue, resources to share
35 of returns handled contractually in layers and division of returns
36 Broad purpose with opportunities driving Singular specific objectives
37 dynamically created objectives
38 Infrastructures that encourage actors to bring own Infrastructures of commons for
39
information, knowledge, and other resources allowing “actors to access the same
40
41
which are only shared in layers with rarely a single information, knowledge and other
42 shared situational awareness resources” for “shared situational
43 awareness” p. 739
44 Range of actor competencies with many not “competent actors who have the
45 setting their own goals but simply responding to knowledge, information, tools and
46 others’ calls for action. values needed to set goals, and
47
48
assess the consequences of potential
49 actions for the achievement of those
50 goals” p. 739
51 Guardrails not as a code but as encouragement to “Protocols are codes of conduct used
52 take measured initiative by actors in exchange and
53 coordination activities” p. 739
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No centralized investment in contributors but Significant centralized
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56 expectation that contributors will only stay if they organizational investment by
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development of consultants (e.g.,
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3 Figure 1:
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Artists’ Hyperloop Renditions
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29 Hyperloop pod traveling through vacuum tube (actual tubes are not transparent)
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50 Hyperloop pod with augmented windows simulating external environment
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3 Figure 2:
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HTT Organization Chart
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6 Screenshot from Facebook at Work
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3 Figure 4
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6 Culture Statement from HTT Onboarding Documents
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13 Vision: We move humanity forward
14 Mission: Deliver the next breakthrough in transportation
15 Core Values:
16 1) We are champions of tomorrow: From the way we work to what we create, we are fervent
17 champions of new and better ways to deliver tomorrow’s innovations today
18 2) We are better together. We are a global community of problem-solvers who believe that all
19 of us is better than one of us
20 3) We are passionate. We are a movement, not just a company
21
4) We are dreamers and doers. The only way to change the world is to dream big; the only way
22
to make a lasting impact is to make those big dreams reality
23
5) We are dedicated to the details. Care for our passengers and communities requires absolute
24
25
precision of every task
26 6) We are “hand raisers”. We are the ones who step forward to make things happen
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16 Bios:
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18 Ann Majchrzak (majchrza@usc.edu) is The USC Associates’ Endowed Professor Chair of
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Business Administration at the Marshall School of Business, University of Southern California.
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21 She obtained her PhD a very long time ago. Her research focuses on how organizations and
22 technology are increasingly intertwined and developing relevant theory.
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24 Terri L. Griffith (tgriffith@scu.edu) is Professor of Management and Entrepreneurship at Santa
25 Clara University’s Leavey School of Business. Her research focuses on the design and
26 integration of technology and work. Her Ph.D., not quite so long ago as Ann’s, is from Carnegie
27
Mellon University’s Tepper School of Business.
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30 David K. Reetz (david.reetz@tum.de) is a doctoral candidate in the department of Innovation
31 and Entrepreneurship at the TUM School of Management, Technische Universität München. He
32 studies search under high uncertainty and the emergence of organizational structure.
33
34 Oliver Alexy (o.alexy@tum.de) is professor of strategic entrepreneurship at TUM School of
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Management, Technische Universität München, where he was also awarded his Ph.D. His
37 current research focuses on effective organization designs for high-uncertainty environments.
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Catalyst Organizations as a New Organization Design for Innovation: The Case of

Article in Academy of Management Discoveries · March 2018

Ann Majchrzak Terri L Griffith

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CATALYST ORGANIZATIONS AS A NEW ORGANIZATION

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