The book discusses the impact of centralization and decentralization of organizations. The authors show that while the lack of a leader may represent chaos, the lack of a traditional leader may be a good way for the organization to survive since there is no specific leader that the rivals can target in order to destroy the organization. The story of the Apache community is used to demonstrate the strength that exists in a decentralized organization. The Apache community was able to defeat the Spanish army because it did not have a centralized leadership. In the same manner, when MGM, a giant in the production industry, sued Napster for sharing music, it was only in a position to stop Napster from distributing the music. However, the war against music piracy could not be won because there was no centralized leader in piracy. The authors liken the internet to the starfish. The starfish does not have a head. Instead, it duplicates its vital organs around its arms. Other than the internet, the strength of a decentralized organization can be seen through the operation of Alcohol Anonymous Associations where there is no definite leader. Like a starfish, a decentralized organization can still function even when some of the vital ingredients of survival are taken away from it. The five legs identified as the pillars of a decentralized organization are circles, the catalyst, ideology, preexisting network and the champion.
The catalyst is described as having hidden powers. A catalyst maps people and identified the connections that exist between them. Catalysts create new connections everyday which allows them to meet new people easily. They lead with emotions which helps them establish strong connections with their subjects. When combated with problems, decentralized organizations react by becoming more decentralized. There are three strategies that can be used to overcome a decentralized organization. The first strategy is changing the ideology of the organization. However, this is a difficult process as it entails changing the foundation of the organization. The second strategy is centralizing the rival organization. The power of the organization comes from its decentralized structure. Centralizing it effectively makes it powerless. Finally, the realization that the best opponent of a starfish is another starfish means that an organization wishing to fight a decentralized organization is in a good position to succeed if it decentralizes itself first.
A totally decentralized organization is an ideal situation. However, there are successful organizations that have combined centralization and decentralization. An example is eBay where it uses a bottom-up structure which is a representation of decentralization but still retains the structure of a centralized company through its structure and profit orientation. This is described as a combo special and it requires a constant balance to ensure that it does not become too centralized. Successful organizations must look for the decentralized sweet spot which is the point where the organization is neither too centralized nor too decentralized. The overall effect of decentralization is a new world that has a new set of rules. This new world does not favor large economies of scale and it values networks as an important way of creating communication and adding value.
Thoughts about the book
The book provokes the mind of an entrepreneur to think beyond the current processes that are glorified by organizations. While many people advocate for a clear leadership in an organization, the book advocates for the organization to create different centers of power. The book shows that the concepts that people believe to be beneficial in the success of an organization are actually a hindrance to the success of the organization. Without chaos, a centralized organization may perform well. However, chaos may destroy the organization since it is easy to target the leadership of the organization and dismantle it.
Through an analysis of the book, it is easy to identify the reasons for the success of the decentralized organizations. With no designated leader, it means that every person in the organization has to become a leader and make decisions on their own. There is no person limiting the actions of the employees in the organization. In such circumstances, it becomes easy for people to come up with creative solutions to problems. There is no person to reprimand an employee after making a mistake hence the employee is not afraid of trying out any ideas that he may conceive.