Definition

1. From [?http://www.communitywiki.org/odd/SocialSynergy/OpenValueNetwork]:?

"Open Value Network(s) expand on Value Networks, by incorporating the possibility to open different processes and exchanges up to a broader base of volunteer, but reciprocated participants.

The Value Network approach seeks to add value to all exchanges in a Value Chain. Including voluntary or traditionally non-compensated participants in Open projects related to business webs.

The Open Value Network approach also seeks to create effective ways for many independent-actor and small group business ventures to create and use OpenValueNetwork models."

(http://www.communitywiki.org/odd/SocialSynergy/OpenValueNetwork)

2. OVN Wiki:

"From a social perspective: an OVN is a complex form of social organization. Through interaction, values and rules as well as norms of reciprocity and trustworthiness are constantly emerging and being (or not) sustained.

From an economic perspective: an OVN is a group of agents that collaborate openly and transparently to offer goods and services, expecting benefits in proportion to everyone’s contribution.

An OVN is understood as a complex dynamical system, a living system, with an emergent structure (not imposed or predefined)... [with] initial conditions for such systems to exist and basic requirements for such systems to succeed in their mission, which are characterized as a Critical Path."

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Description

David Bollier:

"Most commons tightly limit or prohibit the sale of their resources to markets except on stipulated terms, lest market ambitions begin to unravel collective commitments. Open value networks have no reservations about engaging with markets, but they do take active steps to maintain their organizational and cultural integrity as commons-based peer producers. This means that OVNs insist upon open, horizontal and large-scale cooperation and coordination so that everyone knows what is going on. Using systems like Co-budget, OVNs seek to democratically manage shared wealth and assets while allowing individual access, use, authorship and ownership of resources, consistent with group needs. OVNs use a careful accounting of individual “inputs and outcomes” via a common ledger system, and distribute rewards to participants based on their individual contributions to the project.

OVN stress that while they may be legally nonprofits or for-profits, they are not functionally either, in that they have no retained earnings or fixed assets. They instead function as “a flow-through entity which is as formless as possible,” but which functions as a trust for its members, as outlined by a “nondominium” agreement.

?While still fairly rudimentary, OVNs represent a fascinating new type of consensual governance/production regime, bound by contractual terms, that blends commons principles and market activity."
[2], [3]

Context

The Value Network definition from the Wikipedia at

"Value networks (value webs), are complex sets of social and technical resources that work together via relationships to create value in the form of knowledge, intelligence, products, services or social good. Included in a company’s value networks are research, development, design, production, marketing, sales, and distribution - working interdependently to add to the overall worth of products and services. Companies also have external facing value networks where value is created from the relationships and interactions between organizations, its customers or recipients, intermediaries, stakeholders, complementors and suppliers. Value network principles apply equally well to public agencies, civil society organizations and other purposeful networks focused on creating economic or social good."
(Wikipedia:Value network)

History

Tiberius Brastavicenau:

"“The model was first proposed, developed and implemented by Sensorica affiliates. Sensorica was created in February 2011. Initially, the model evolved from the Discovery Network model proposed by Tibi between 2008 and 2010. In 2011, the model was developed in collaboration mainly by Tibi, Steve, Kurt, and Bayle, and drew from the work of Verna Allee, Yochai Benkler, Michel Bauwens, Clay Shirky, and others. After the summer of 2012, the network resource planning and contribution accounting system (NRP-CAS) was influenced by Bob Haugen who has been working on resource planning systems since 1995.

Yasir joined Sensorica in 2013 and helped develop the framework for open value networks. The OVN model was extended to network of networks, in the context of the Open Alliance initiative also lead by Sensorica, an attempt to federate open organizations in Montreal. In 2016 the NOICE/Verdun project built on the Open Alliance initiative, as a second attempt to bring the OVN model at a larger scale.

Other organizations have adopted a model similar to Sensorica: CoMakery, CollectiveOne, Scuttlebutt.” [OVN world wiki pages].

Although rooted in earlier and ongoing traditions of open source and collaborative economies, OVN redresses the flaws of collaborative crowdsourcing in CBPP, notably the unsustainable capture of open source value by corporate private interest. The value that is captured by private interest can be captured by an OVN and shared internally bringing value to both contributors and the community. The emphasis thus far has been on FabLab type manufacturing, research intensive projects in a permissionless setting, but can apply to a variety of end uses. The OVN framework accomplishes this feat through a formal accounting of contributions and planning via (….) protocols: NRP (network resource planning), socialization of work, transparency, commoning, a Contribution Accounting System that includes localized cultural subjectivity, signalization, content, interaction, and logging contributions. An OVN also requires contribution accounting and exchange systems, a fair Reputation system, a Role system, a Feedback system, an Incentive system. The OVN framework structure is at four different levels: project-level, open-enterprise level (inter-project level), network level (inter-enterprise level), and global level (inter-network level) [Yasir Siddiqui 2013]. This serves to trickle up network synergies to empower social and environmental demands at global network level.

Organizationally, OVNs at project level are permissionless and flatter, less hierarchical than more traditional business models, relying on stigmergy to self-coordinate. OVN’s structure formalizes stigmergic patterns through patterns of actions/feedback and self documentation. OVNs like Sensorica are focused on prototyping , research with an eye to serial manufacturing. In practice, an OVN registers contributor contributions towards the value of a project/goods/product/service in a value cycle from value creation to value distribution via a value equation.

The key idea behind the value equation is to reformulate the value distribution problem to a matching problem and disconnect money (or exchange value) from the process of value distribution. [Value cycle and value equation Yasir Siddiqui 2014 ]

In effect, for the first time, an attribution system is integrated into the production workflow and supply chains. The first record keeping implementations were in the form of google spreadsheets, in development on blockchain and holochain alpha. Meanwhile DAOs and other protocols are rapidly converging on similar solutions."

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Disccussion

Tiberius Brastavicenau on the Open Value Networks Practice at Sensorica

Tiberius Brastaviceanu:

"Since 2008 I have been involved in building infrastructure for commons-based peer production. In the open value network model that we propose, the economic activity of all the network affiliates operating in a peer production network is recorded, activities are compared and weighted against each others based on metrics that are agreed upon democratically. The redistribution of benefits is in part quantitative, turning someone's efforts into coins, which can represent equity or debt and can be later used to get tangible benefits. Qualitative characteristics of economic contributions and behavior are also taken into consideration, based on how the contribution is made, on different dimensions of reputation of the affiliate, etc. All this is packaged into an IT tool, a contribution accounting system and an algorithm for computing the redistribution of benefits that we call a value equation. This represents a social contract among affiliates, designed to generate a sense of fairness among them and to render the economic activity effective and efficient.

This system for capturing, recording and comparing economic activity has been implemented in SENSORICA, the first open value network. The same system can also be applied to other types of organizations, more or less networked, more or less open (with respect to access to participation) or transparent (with respect to access to information).

This system has profound consequences on how the global economy works. Let's enumerate a few of them.

When I was in my teenage years, I worked on a farm situated a few kilometers north of Montreal, Canada, picking blueberries and strawberries. We were payed by the weight of fruit that we picked. Throughout the day, we would bring our fruit baskets to a tractor, where they were weighed, and a record was produced. At the end of the day, everyone was paid according to the total weight gathered (a metric for economic activity). Some were making a lot more than others. It was a purely meritocratic redistribution scheme for a simple economic activity, using a very simple metric. This is very different from the normal employment setting, where employees are paid a fixed, negotiated and agreed upon salary, formalized as a job contract. The employer agrees to pay a certain number of coins to an employee before even starting working. This requires some diligence from the employer, which comes in a form of a filter, a job interview. Moreover, this also requires constant monitoring of the employees' contribution to the company. Companies engage in time management and regular performance reviews. There are at least two important setbacks in this employment setting compared to the first one. For one, the managerial overhead for time management and performance monitoring. Second, the inability of the company to dynamically adjust its workforce and talent base, because of the heavy filtering mechanisms and the contractual agreements in place. We will expand on this below. In the raspberry picking case, the payment is proportional to the production, therefore the need to filter and for time management is less stringent. The reward is directly related to the production. This case presupposes the existence of means to evaluate contributions. The activity that doesn't result in a positive contribution, or that causes damage can be dealt with in various ways. For raspberry picking, the evaluation scheme is obvious: total weight of the picked fruit. The new information technology allows us to go far beyond this simple case, to deal with the complexity of numerous and various tasks involved in our normal workday. A contribution accounting system coupled to a value equation gives flexibility to organizations of all sorts and help them reduce costs.

Another important consequence of this technology is that it allows an organization to tap into the world's massive human resources in a very dynamic way. At any given moment, there is someone on this planet that has the solution to your problem. Finding this individual or a group of individuals is one important hurdle. But once that hurdle is passed, we need to be able to effectively integrate this new talent into the stream of activities and its associated reward mechanisms. The possible contributor can be far away, which means hard to identify and authenticate, hard to monitor, hard to reprehend, … In these circumstances, the classical mode of employment is long, costly, and sometimes even impossible if we take into consideration all the geopolitical hurdles in place. These opportunities are lost most of the time, and the company is obliged to work with what it has. Different crowdsourcing platforms have emerged as an interface between companies and the crowd, but in my opinion their value proposition is not resonating well with the crowd. Crowd-based problem solving schemes work very well in open source projects and in projects with a great social impact, They are not performing well when only corporate interest is behind the problem. Companies can develop less exploitative and less alienating mechanisms for managing their own crowd-based activities. In order to do so, they must move away from contractual relationships and time management, to interface directly with the crowd by using tools for contribution accounting and evaluation.

There are other important consequences that we can discuss here, but I think we should jump directly to the one that has, by far, the most disruptive effects on our global economic system. That is the possibility to put information about past economic activity back into the system of redistribution of resources.

A dollar bill that you receive from someone doesn’t come with a description about how this individual acquired it, or about how this individual is seen by his peers in a context of work. It could have been earned honestly or dishonestly.

The contribution accounting system and its value equation implemented in the SENSORICA open value network is used to reward participants based on past economic activity. This data accumulated for every affiliate can be distilled into a socioeconomic profile that can be consulted by anyone around the world. It is very dangerous to allow all this information to be gathered and controlled by private interests. These systems should not be deployed by organizations like Facebook or Google. They must be developed on top of p2p infrastructures like block chain for example. That is precisely what we are striving to do with the open value network infrastructure.

Sensoricans designed and experimented with a system that allows redistribution of benefits and privileges, eliminating the problem of the classical monetary coin, for being detached from the role of the individual in society. This is very similar to the situation in my mother’s village. The system can be scaled and it is using digital technology instead of clay tablets, which makes it easy to gather, store, analyse and retrieve information about socio-economic activity in real time, with no spatial barriers. This is not a Big Brother situation if applied according to p2p principles.

We are in the middle of a socioeconomic revolution. It is still unclear what the future will look like. In order to inform this transformation we need to revisit a fundamental concept that is used in all these approaches, value."

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OVN's vs DAOs

Tiberius Brastaviceanu et al. :

“An Open Value Network (OVN) is primarily an organizational framework designed to support commons-based peer production” ; structure comes first. But not in the same way as DAOs. DAOs are more an engineering approach, designing a game with the goal to incentivize people to behave in a certain way, geared towards collaborative production. OVNs provide a frame, without prescribing a specific game for open ventures. Open ventures can start from a template game, remix a template or create an entirely new game. An OVN is seen as an ecosystem. Ventures within the network interconnect at a very intimate level as valuables flow freely between them. In DAOs there is no real discussion about flow of resources between them other than cryptographic tokens. Nevertheless, DAOs do have an underlying ecosystem of libraries of smart contracts and DAO2DAO protocols, AMM (Automatic Market Makers) for tokens, TheGraph to provide interoperability between DAOs. The underlying blockchain provides basic connectivity. But no real structure exists for DAOs to perform the level of sophisticated project management, division of labor, accounting methodology that OVN embed in their framework to get things done and that legacy organizations have benefited from for centuries."

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More Information

See the related entry on Open Value Metrics.
see Value Networks ; by Verna Allee

Open Value Networks

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