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This article is Part 1 of 2. In Part 1, I discuss the concept of decentralization and how it pertains to decision-making and authority. In Part 2, I’ll build on the concepts in this article specifically through the lens of transportation and mobility.
These days, “decentralization” is a quasi-buzzword. It’s only quasi because most people don’t really understand what it means, and even amongst the technorati there has been some disagreement on the definition. There are also various types of decentralization. So for the sake of this article, let’s settle on “no single entity controls everything.” Another way of thinking of a decentralized network is to consider the “slicing scenario”. If you were to slice the network—including its users—in half (or thirds, or whatever), and the two halves were to continue to operate independently, it’s decentralized.
It’s a buzzword because it’s a (and perhaps the) central promise of blockchain, and goes arm-in-arm with other words like “disruptive”, “transformative” and “world-changing.” It’s used in marketing for a wide variety of blockchain projects, many of which are appropriate for the decentralization model. Of course, many are not, as we have come to learn.
Centralization is the Status Quo
Our world has largely operated in a centralized fashion since time immemorial. Banks are our trusted gatekeepers to and custodians of our money, for saving, lending, borrowing, and investing. Government provides excellent examples of centralized order: look at the feudal system, which held sway in Europe between the 9th and 15th centuries. Power and land were the province of the King (or less often, the Queen), and in exchange for taxes, service and loyalty, dukes and earls held, worked and profited from those lands granted them. The dukes and earls couldn’t manage those lands by themselves, so lesser lords swore fealty to them for smaller portions of land, again in exchange for taxes and loyalty. This continued down to the serf, who was bound to the land he worked, his labour offered to his lord in exchange for protection.
Of particular relevance to this discussion is the way authority was transmitted in a “feudal network”. All rules, all policies and all protocols came from the King, who informed his direct underlings (the dukes and earls) of his wishes. These great lords notified their own underlings of the royal decrees and so forth. Notably, at each tier of authority the lord would usually call upon his most important underlings to attend a council for advice on meaningful matters, but just as notably the final decision was always the lord’s. There was no question that authority and decision-making power was held by those above you in station. Your participation in all such matters would’ve been solely at their pleasure.
What would decentralized authority look like?
At the beginning I stated that “decentralization” is often nebulous in its definition, and this is reflected in all of its applications. Consider the business management definition of a decentralized organization: “a systematic delegation of authority at all levels of management and in all of the organization.” Within the details of that definition though, we see that while more authority is given to lower-rank members of a team than is customary, ultimate authority and strategic decisions remain at the top. I’d argue that this model is better titled “somewhat re-distributed authority”, where the old rules still apply.
Actual decentralized authority, as you might find on a blockchain, is where “no single entity controls everything.” There’s no chief executive, or board of directors, or suite of vice presidents making decisions for the whole or larger part. Instead, each participant in the system is a member of the entire body, and each participant has as much authority as the next participant. No one is special, no one has a “tie-breaking vote”, no one has veto power. Decisions that impact the entire body are made as a whole, with each participant having a voice. Decisions that have to do with just the participant are decided upon by that participant. Decisions that involve two (or three or four, etc) participants are decided upon by the involved parties, again with each having a voice.
To a large degree, the Internet is an example of decentralization. It is a body that has no central governance. There are multiple stakeholders who have varied, complex and competing interests who ultimately cooperate to bring about consensus on policies and standards created for the public good. Participation in governance by these interconnected and autonomous networks is voluntary. They represent the public and private sectors, academia, and national organizations among others. The decentralization however ceases at the stakeholder group level, where each group has its own board, executives and staff, all of whom have roles to play within their own hierarchies.
But what if every single individual was empowered to contribute to a broader network? What if each participant could fully leverage the network, with the same access and opportunities as every other stakeholder? What would that look like?
Keep an eye out for Part 2 next week, where I put the ideas discussed in this article to use in a meaningful scenario for the average consumer in the transport space.
January 12, 2019 at 02:39AM
Forbes – Entrepreneurs