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And why I think most communities are (mistakenly) run like corporations.

In my daily work I get to interact with and learn from community builders from allover the world. And over the last few weeks I have been observing a fascinating pattern: Many communities seem to be run like corporations: heavily centralized, top-down management, optimizing for short-term value, clear value propositions, etc.

It makes sense. That’s the organizational model many of us are most familiar with. That’s what is taught in business school, that’s what we observe in our jobs every day. So it seems reasonable that we model our behavior on the same organization structure as we build communities. Because most of us who design and run communities have never taken a “community building 101” course. Most of us just figure it out as we go.

Running a corporation vs running a community

But in many ways, communities operate differently from other types of organization. And I think that at the core is the following distinction:

  • In our current operating model, all for-profit corporations in the world exist for one single reason: to optimize for shareholder value. To create as much value for their shareholders as possible.
  • Similarly, most non-profit organizations in the world exist for a specific reason: to create as much impact towards their mission goals as possible.
  • The fascinating thing about these models is that both of them have external purposes. The organizations exist to solve an external problem (shareholders are usually not the people working in the organization or running it, the people running non-profits are usually not the recipient of their value).
  • Communities on the other hand, so at least my theory, are fundamentally different, because they exist foremost for an internal purpose: they exist to create as much value for its members, and that value is often relationship-based and measured in the form of trust. So you could say that communities exist to optimize for trust among their members.

Community = optimizing for trust

I think this distinction matters tremendously when we ask ourselves the question how to design and run communities. As mentioned above, many communities today are being run by using the corporate / non-profit model. But I think that’s a mistake. We need a different handbook for communities.

There is much talk these days about human-centric organizations. And I would argue that a community is the ultimate human-centric organization: where the collective needs and wellbeing of the people who make up the organization are the organization’s highest priority, and all activities and processes are therefore designed accordingly.

Both models can learn from each other

Of course, the two models aren’t mutually exclusive and can even strengthen each other:

  • Communities still have many elements where they can profit from the stability and processes of a corporations (for example when we think about managing day to day operations, business models, long-term planning, etc).
  • And similarly, corporations can benefit from a more human-centric approach. It seems that an increasing number of organizations are starting to realize that a healthy culture, trust and their employee’s wellbeing is not just a nice-to-have, but a strategic asset.

What does it mean to optimize for trust?

A question I’m playing with at the moment is: if you’re trying to optimize for trust, how does that affect the way you run day to day operations? What does it mean, for example, for how you communicate? For how you keep or distribute power? For the organization’s values? For the business model? For “leadership”? For conflicts?

Curious and grateful to hear what you all think!