First principles for DAO design / Andrej Berlin

Transcript

foreign okay good afternoon everybody Welcome to eat Prague it gives me great thank you very much it gives me great pleasure to welcome you all here to eth Prague the studio audience and also to welcome all the viewers on the live stream hi mom um I'm going to start off and kick off this eat Prague set of presentations we've got a lot of great presentations coming live stream interviews throughout the day and throughout the weekend but to start off we're going to go to Andre Berlin who's going to talk about first principles for Dow design please give it up for Andre [Applause]

thank you thank you so much for having me so over the next 20 minutes or so I'll try to narrate a mental model for how the centralized organizations can look and then I'll guide you through a couple of principles and guidelines on how to actually approach designing

organizations that are permissionless autonomous and in theory also infinitely scalable and then I'll uh go into a little bit of how that can look in the future before I start I just want to thank everybody who first of all everybody who's here and who's listening but also everybody who's been contributing to deep work which is a design studio that I built because without these people the research that I'm facing the following presentation on would not have been possible they're kind of live actors in A system that helped understand how these things can can work nobody has contractual obligations and yet over the last four years we have

together designed over 40 different products some of which you are probably very familiar with before the Middle Ages work was considered as something that was just an integral part of life so people would just sleep work eat in the Middle Ages Christian chauvinist combined the idea of work with being a good with the concept of being a good person so if you do the work you receive money profits go to the church church distributed distributes it to the poor people that's a good thing in the eyes of God so you're a good person that same mental framework translated in the industrialization except for factory

work so you were basically in a well-functioning society if you're a working person whether you like it or not and that concept is still used by neo-economists to explain how the economy works because again regardless of whether people like working or not it's seen as kind of a necessity or disutility even to afford leisure and then obviously people buy things and economy flourishes and that seems to be a reasonable way to explain it the reason why I'm preempting the presentation with that or why I'm saying this is because I don't think that we can build organizations that are based on the principles that people don't like working if we want to achieve

behaviors that are goal directed in order to solve all the problems that we're working on I think that people generally like working stuff as long working on stuff as long as it's meaningful as long as they see the purpose of it as long as they see an opportunity for collaboration and as long as they feel fairly compensated and I think that's kind of where any organization any stage has to start with so not just like what you're what you're interested in what you want to be doing but also like what's the value behind it and then obviously who are you designing who are you building stuff for who are you creating this value for and then only you go into creating a business model around that

that also helps you to avoid the fallacy of seeing your organization as a kind of a competitive race and like being better than someone else because it's it's not and we can see that on online communities for example online communities flourish because people just gravitate towards certain content and they like it and they don't think that some information or some knowledge is better than in a different forum I mean I think we can also generally learn quite a lot from online communities because they also build out this very rich network of profiles that shows who people are before you actually have to get to talk to them obviously on the other hand we also need

to think about kind of profitable or a profitability of a business and I think that this combination of these two things is what we're looking for and it would probably manifest itself in having people giving people the autonomy and freedom to work on whatever they want whenever they want to work on these things the ability to still have Financial stability like in a payroll job but also have the opportunity to get into an organization and leave it at any point in time and actually have the possibility to be excluded from that organization at any point in time because that's a like a social driver and also we need to make sure that organizations are as transparent as possible about everything

so that people can actually do the work and then gather reputation and have portable reputation so this is already kind of going not really technical so I'm not talking about like how to use Snapshot or uh multi-6 or something in fact I don't think that Dallas really exist yet in that way or that is kind of a reasonable way to describe it though I think um maybe the only one is like Bitcoin um but I think if we focus on certain aspects of work and we manage to decentralize them and and um automate some others we can get to a model of organizations that closely mimics the way that biological organisms work and there's excellent research

from my friends from uh block science on the so-called viable System model you should look it up it is very applicable to any organization any stage to make it resilient and adaptable start sorry in order to start designing organizations I think we need to make an assumption that time or chronological time is not an adequate measure for work and we can see that also like I think last week in the UK 70 companies or so reduce the working week to four days without lowering the pay that's makes it obvious that the quality of the work is not really represented by the time spent and we also have things like our tracking where people just don't like tracking

their hours for example or they overestimate so that also doesn't seem to be a reasonable way to measure work but I think that if we look at work as kind of project-based work but with very very specific conditions or like properties which is a very specific outcome a process how to achieve that outcome and the duration that it takes to achieve that outcome then Things become a lot easier this is how also deep work started so we started offering kind of design services but not in like a nebulous way but we were very specific we said only seven days this is exactly the outcome here's exactly the process and you can also do that with basically any type of work it's not easy but you Scope it out and then you calculate the amount of

hours from the team that it takes to achieve that particular outcome you compare that to the market rate of the person you actually then have a cost and that cost you can negotiate with either an external party or an internal stakeholder um and of course I know that people have different perspectives on what a project is um but I think you can learn a lot from design Thinking Tools popularized by ID also also something I would really recommend if you want to align teams on something that seems very difficult to align on design thinking offers a really good tool but then with these projects you basically can have like you co-evolve them as you negotiate with your stakeholder what that consists of and what the value is

and I can't stress enough the kind of value of project-based work so I'm gonna I know that it's kind of hard to specify all the things that we do into into projects but I think it offers a lot of really interesting opportunities and and benefits like if you specify it then you can pay people meritocratically if you convert a work stream to projects then you have and you have feedback loops so you can make sure that people improve over time you have points where you can measure the outcomes a lot better especially in a complex organization that becomes tricky and you can use them in order to provide reputation to people or like read out the reputation from people as a side effect an organization also becomes quite cost effective because in economic

uncertainty you basically don't need to pay for the work that's not being done you only focus on the things that have to be done the other thing that I think is also important is that it can help you solve the problem of like onboarding on or hiring new people so I don't know at which stages your teams are or in which Journeys you are but there will be a stage where you need to hire people or introduce them to the organization and if you have projects some Progressive organizations actually do that quite well where they let people work together on projects so they Mentor them in but in combination with kind of an open project-based work people know that the cost of firing are

getting excluded from the organization is zero so what they hold on to is not a contract they hold on to the social relationships that they establish between you know the mentors and mentees or students students are willing to learn more and have more access to work mentors want to replace themselves or find some help and the consequence of that kind of relationship you also see that people develop what we kind of externally call soft skills so they develop management management skills or project management hiring obviously and uh yeah and like education or mentorship so

because people actually kind of like working together they tend to make all these relationships a lot more valuable and also especially with with deep work we can see that if someone brings new people in then it's always someone who is kind of in a trusted Network so someone who's going to bring in good quality work as well and by the way none of this concept really requires like blockchain or web3 technology um per se all um you can basically use existing no code tools in order to build that together so even deeper is built basically that way and only now we're slowly introducing web 3 based tools but the and obviously you can introduce

or like you can enhance it with tokens or with web3 tools tokens have the ability to make people kind of feel shared or see the shared ownership of an organization which is also a good example for from one Hive where that works really well but I think that still is very kind of useful to think about the organization as being a network of social relationships rather than people trying to kind of find the the best candidate or the employee trying to find the best job and like kind of working on their like taking their CV or something one thing that's that is relevant for that or like that's also kind of a prerequisite for that is that you're very clear about the roles and the work that's being done and

also kind of transparent about how to do it so we created for example a very very sophisticated documentation of the work and documentation of the roles there are a lot of examples in a traditional space as well I think like McKinsey was also one of the kind of um most popular examples of having like high quality documentation but it was locked in and here you can make it transparent so not only can you show the high quality standard of the work but you can also make that kind of an attractor for people so now they you don't need to reach out to anyone people just kind of gravitate towards the work because they want to do that and also if it's like well described you have a really nice way to already like they can learn it

before they start working on it that's just really cool story I'll just skip that one um and so the especially if the documentation or this this these Primitives of projects and roles are public you can use them kind of as as data points or like certain artifacts so with with the dominance hierarchies they become clear so people can Traverse them so they can understand what they want to learn next you can create like conditional prerequisites for going to the next role or if you're using token based governance or direct democracy you can assign them specific weights if you think that one of the roles has a certain value that's higher than another

or like should have should contribute to the change of a particular Organization for example and of course because everything is open source it also allows to do the things that you could do with open source software so people can Fork skills you can you can Fork a design studio now you can create your own design studio if you wanted to um which is I think great because you can because you'll see how a market can evolve and a lot more organizations can be created based on something that's already existing or people have the ability to improve what they're working on this is very important if you if you don't want to avoid kind of micromanaging or middle managing that if these things are transparent if the roles and the processes are

transparent then people have the ability to improve on them what they also obviously need is kind of the way to oh yeah sorry skip that one but it doesn't matter but you also need to see look at is the um the data that gets accumulated through that so once you specify specific projects and and roles they're calculatable so you can provide people with the data of what's actually going on inside the organization so they can make sense of how to behave whether they should stick in the organization or whether they should spend their time maybe somewhere else there's a so-called problem called L for all problem and complexity science

um it's also quite useful to think about which basically explains how you can create an organization or a system in which you have an equilibrium of people contributing to the system so let's say there's a limited amount of work and you want people to be exactly that same amount then you have to provide them with as much data as possible throughout time but also with enough data so that they can develop as many strategies as possible and if you can do that with the work that is happening internally then you basically have the the perfect the ideal size the people can decide and in response to the how the market evolves whether they should work in an

organization or not the last thing that I want to kind of quickly touch on is the portable reputation reputation has been logged in organizations so far because of kind of private privacy concerns or competitive reasons and I know that there's like you know LinkedIn or portfolios self-attested portfolios but if you have specified the exact roles from the inside you have they look like roles but from the outside they actually can be perceived as skills then and they're already verified by someone else because you are just doing the work in the organization the organization is verifying that you yes you have that role you have that skill and to the public you can see the

quality standard of the organization you can see the contribution and uh it makes it kind of more trustworthy than um than the Alternatives that we have of course we need to make sure that people still own their data so um that they can only share the things that they want to be sharing and this is something that's kind of I think currently evolving or will evolve more in the future where we can use like zero knowledge proofs or something to give people the ability to share only very specific data so I think that generally the um future of that is relatively kind of um

interesting if we assume that we get these data points because based on those we can create essentially a Marketplace of ways to work with roles and skills so you can you know create certain skill trees or algorithms that predict what would be better to work on next or have a much easier way to uh verify someone's skills or like get a bank loan or something do a kyc process I think so bound tokens also kind of fit into that same area of requirements so I hope that gave you kind of a quick or short summary of The some of the principles

that I can see in in designing an organization obviously this is non-exhaustive obviously there's like billions of different things and much more granular things to think about um but yeah covered things like the uh work is a meaningful part of life Project based so think about process outcome duration mentorship high quality documentation that's public so everybody can see it and obviously think about public rep portable reputation I think the more organizations adopt these principles the more we'll see a stability for people to work wherever they like like Financial stability and social stability while retaining the flexibility of the

organizations or actually as a consequence of that flexibility this stability will emerge so yeah if you're obviously again there's like millions of different things if you're interested in more you can follow me on Instagram or Twitter I started posting a couple of videos that are very kind of low-key and explaining some of these Concepts more um and yeah thank you so much for your interest in design and I wish you a beautiful rest of the conference thank you