Academic journal article JITTA : Journal of Information Technology Theory and Application

Synthesizing an Autonomous Business out of Social Parts: A Cognitive Analysis

Academic journal article JITTA : Journal of Information Technology Theory and Application

Synthesizing an Autonomous Business out of Social Parts: A Cognitive Analysis

Article excerpt

ABSTRACT

A programmable autonomous business is a novel kind of business built entirely in software that is functionally indistinguishable from a conventional business-acquiring customers, providing a product to those customers, and making an actual profit for doing so. The difference is that the autonomous business has no employees or managers guiding it; all operations are automated in software. While we know that autonomous businesses are possible, we do not understand why. To address this issue I analyze a basic autonomous business as a distributed cognitive system. I show that an autonomous business is composed of a rather mundane set of social practices whose performance is mediated by online technology. These social practices when performed "offline" have nothing to do with business. However, the synthesis of these technological-mediated social practices results in the emergence of an autonomous business. I discuss why mediating the performance of these social practices with online technologies allows them to instantiate business processes, and conclude by describing the practical applications of the findings and outlining areas for future research.

INTRODUCTION

A "programmable autonomous business" (Flor, 2004a), or simply "autonomous businesses," is a profitable company that one can build entirely in software (programmable) and that once implemented can run itself with no human employees (autonomous). E-bay.com, a web-based auction site, is perhaps the most well-known example of such a business. While Ebay currently employs workers it, nonetheless, qualifies as a programmable autonomous business since it could continue to operate-bringing in new customers and generating income-even if all its employees were fired. The lack of the need for human control has been publicly acknowledged by the management of such companies, who have joked to the popular press that "a monkey could drive this train" (Lashinksy, 2003; in reference to e-Bay).

Although we know that programmable autonomous businesses are possible, we do not know how to systematically create them, as evidenced by the widespread dissolution of many allegedly promising such businesses during the dot-corn crash of 2000 (Green, Yang, and Judge, 2000). However, systematically creating autonomous businesses requires first understanding how they operate. The objective of autonomous business research is to uncover the processes that allow programmable businesses to operate autonomously.

Autonomous business research is an outgrowth of research on virtual community business models (Hagel and Armstrong, 1997, Hagel, 1999). The term virtual community was coined by Rheingold (1997) to describe "social aggregations that emerge from the Net when enough people carry on ... public discussions long enough, with sufficient human feeling, to form webs of personal relationships in cyberspace." Examples of virtual communities include chat rooms, forums, and Multi-User Dungeons (MUDs). A virtual community business model is a virtual community with commerce mechanisms added. Specifically, Hagel and Armstrong (1997, p.89) define five elements of a virtual community business model: (a) distinctive focus; (b) capacity to integrate content and communication; (c) appreciation of member generated content; (d) access to competing publishers and vendors; and (d) commercial orientation.

Research on virtual community business models has mainly focused on how to harness virtual communities for business purposes. For example, Rothaermel and Sugiyama (2000) performed an inductive analysis of a successful virtual community business and derived seven propositions, which related community characteristics, such as membership size and scalability, to commercial success. Studies of virtual communities for marketing purposes include: Evans, Wedande, Ralston, and van 't HuI (2001), who proposed that marketers use virtual communities to facilitate three-way communication with a company, consumer, and between consumers; and Maclaran and Catterall (2002) who analyzed the potential for using ethnographic methods to extract marketing information from the many-to-many communications environment provided by virtual communities. …

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