Reimagining Business on the Blockchain

It has never been more clear to me that the future of business needs to change. One way to do that is with the Blockchain. In the rapidly evolving digital landscape, organizations are facing increasing pressure to stay aligned with their mission, goals, and regulations, and to meet membership expectations all while protecting their IP, Brand, Customer base data and integrity. Centralized, hierarchical systems often leave room for communication breakdowns, top-down management silos or worse oligarchies, decision-making bottlenecks. Centralized financial control can often hinder accountability, making it difficult to track spending and ensure responsible use of resources. As a result, organizations on a journey to become transparency instead end up misaligned, losing touch with the very clients, customers and communities they were created to serve. Enter blockchain technology, a disruptive force that offers a truly transparent, decentralized alternative to traditional organizational structures.

Imagine a world where contributions are valued, decisions are smart and being a part of something not only gains you access but gives you an active voice in the direction of the organization. Decentralized Autonomous Organizations (DAOs) the wave of the future, they provide options to create the unthinkable – technical organizations. DAOs eliminate the need for traditional hierarchies – layers upon layers of fluff and bureaucracy, enabling organizations to operate through collective decision-making.

I certainly had reservations about DAOs. I have always perceived them to be rooted in the same centralization that we were aiming to get away from. And while that may be true (somewhat), I seek solitude in the blockchain as a I watch organizations with important missions crumble due to a lack of transparency, disjointed structures, dishonesty and simply not knowing better; it is now time for a better look at some different, if not entirely better options.

What is a DAO?

DAOs are a form of an organizational structure. This type of framework empowers organizations, rather than control them. These models foster true autonomy and innovation.

With a DAO, decisions aren’t dictated by a few at the top. Instead, voting is decentralized, and smart contracts ensure that decisions are executed automatically based on the collective input (vote) of members. This streamlines decision-making but it also ensures that members voices are heard, reducing the risk of misalignment with organizational goals.

It also provides members with a way to communicate regarding sensitive topics they may not feel comfortable sharing in an open meeting or even one on one. Empowering the community or membership is at the heart of what nonprofits and other community organizations are driven to do, so this makes sense.

Now, contrast that with a DAO, where every member has equal access to decision-making tools. In a DAO, instead of waiting for a committee to implement the board’s decisions, all members directly participate in the voting and execution of strategies, ensuring immediate alignment and accountability.

Another key area where traditional models struggle is organizational elections for roles and seats. In many conventional structures, elections are often marred by politics, lobbying, and bias. Those who seek leadership positions may resort to forming alliances that do not necessarily serve the best interest of the organization. Voting processes may also lack transparency, leading members to question the legitimacy of results. With a DAO, however, elections can be automated and fully transparent. Votes are anonymized and stored on the blockchain, making tampering virtually impossible and ensuring that each vote is accurately counted.

Consider one more example — decision-making in project timelines. In a traditional setup, timelines for projects can be bogged down by approval bottlenecks, especially when multiple layers of management are involved. Project teams may need sign-offs from various departments or managers, often causing delays as decisions get stuck in bureaucracy. In a DAO, decision-making is decentralized, allowing teams to propose deadlines and vote on them collectively, streamlining the process. With clear consensus and automated execution, timelines are better managed, and work progresses without the need for continuous approval loops. A secondary benefit to the voting mechanism is ownership, empowerment. When you are a part of the process, you feel like you were a part of the build or creation or execution of the “thing” – everyone’s vote actually does count in this case ( Its worth noting that some DAOs have opted to allow vote by proxy which imho is more of the same. )

In each of these cases, DAOs solve typical challenges by removing the hierarchical barriers that often hinder swift, fair, and transparent organizational processes. By redistributing power from the few to the many, DAOs empower members to shape the future of the organization in real time, leading to a more engaged and efficient collective.

Fiscal Responsibility and Transparency

One of the critical pain points for any organization is maintaining fiscal responsibility while ensuring transparency in cash flow and funding allocations. Blockchain provides a robust solution to this problem. By leveraging cryptocurrencies (cryptographic, digital currency) for vendor payments and managing assets, organizations can create immutable (permanent) records of every transaction. That is a lot of words to describe, fast, borderless, transparent, permissionless transactions. This ensures that funds are not only tracked in real time but are also protected against tampering and most fraud.

Moreover, organizations can build upon their assets even in a volatile crypto market by strategically managing investments and allocations (just like with regular market shifts) . While crypto volatility can be daunting, it also presents opportunities for growth that traditional financial systems cannot offer. By embedding these processes on the blockchain, organizations create a transparent and agile financial system that can adapt to market changes while remaining aligned with long-term goals. Imagine if Federal Contracting were clear and readily accessible for anyone to see.

Member Autonomy and Decisive Action

Blockchain also empowers members to take decisive actions, particularly through voting mechanisms embedded in smart contracts. Imagine an organization where every significant decision—whether it’s the allocation of funds, the direction of a project, or a new initiative—is voted on by members in real time. Blockchain makes this possible by ensuring that each vote is counted accurately, and once a decision is reached, it is executed automatically without the need for intermediaries.

Autonomy is critical here. Members no longer need to rely on leadership to enact decisions or trust that the “higher-ups” have their best interests in mind. The blockchain democratizes decision-making, giving members real ownership over the direction of the organization. This prevents vendettas, harassment, or favoritism from skewing decisions, as each choice is driven by data, transparency, and collective consensus.

To further align with the goals of transparency and member-driven decision-making, DAOs offer a streamlined solution to incident reporting, promotions, and team structure. Traditional organizations often face issues of inflated hierarchies and ineffective, bloated teams. By leveraging DAOs and blockchain technology, organizations can flatten these hierarchies and democratize the decision-making process. For instance, anonymous voting on promotions, leadership roles, and project efforts can be conducted seamlessly on the blockchain. This method prevents favoritism and ensures that leadership is granted based on merit, performance, and peer review rather than seniority or personal biases. Additionally, the same mechanism can be used to gather feedback on team performance and leadership, enabling an ongoing cycle of improvement and accountability. By reducing unnecessary roles and streamlining team structures, DAOs can prevent the inefficiencies that often plague larger, heavier hierarchical organizations.

Preventing Unjust Bias and Enhancing Transparent Collaboration

One often overlooked advantage of blockchain in organizational management is its potential to enhance fairness and transparency, which can help address biases and promote inclusivity. Traditional systems can allow certain individuals or groups to wield disproportionate influence over decisions, leaving room for bias and exclusion. Blockchain, however, creates a level playing field by securely recording every vote, transaction, and decision in an immutable ledger that is both transparent and pseudonymous. This reduces the risk of personal agendas or discrimination impacting outcomes, fostering a more data-driven and collective approach to decision-making. While blockchain offers valuable tools for accountability and fairness, achieving true inclusivity still depends on how the system is designed and governed.

Additionally, by integrating blockchain into organizational change management, organizations can track the progress of initiatives, monitor member engagement, and identify areas for improvement without the fear of retaliation or exclusion. This creates a more cohesive, transparent, and inclusive organization that can pivot and adapt to change while staying true to its mission.

integrating blockchain into organizational change management offers even more transformative potential. By using blockchain to track the progress of initiatives and monitor member engagement, organizations can gain a real-time, tamper-proof record of who is contributing and how initiatives are evolving. This allows leaders to identify areas for improvement with data-backed insights, minimizing the fear of retaliation or exclusion often seen in traditional management systems. The transparent nature of blockchain ensures that all stakeholders are accountable, promoting a culture of inclusivity and openness. As a result, organizations can not only adapt to change more effectively but also foster a sense of trust and cohesion, allowing them to pivot without sacrificing their core mission or values.

Decentralized Autonomous Corporations: The Future of Business?

When I was first introduced to DACs a few years ago, I was skeptical too. Can a corporation truly take a decentralized approach to operations and still survive? The answer is yes but it definitely depends. Blockchain technology is also paving the way for decentralized autonomous corporations (DACs), which takes the DAO model a step further. DACs are essentially corporations that operate without the need for a central authority, relying entirely on blockchain and smart contracts to manage operations, financials, and decision-making. This doesn’t replace human capital but it does disrupt traditional operations, functionalities that shift to the blockchain. Think decision making, approvals and functional handoffs, milestones for projects these can all be points of intersection with the Blockchain. These entities are designed to be fully autonomous, self-sustaining, and entirely driven by member input.

For organizations looking to stay future-forward, DACs present a compelling model. They allow for maximum transparency, fiscal responsibility, and member-driven governance, all while reducing administrative overhead and fostering innovation. DACs, like DAOs, are not bound by geography or traditional corporate structures, enabling organizations to operate globally and inclusively.

A note on AI

Everything discussed so far was happening well before the AI boom ie before AI was on everyone minds as the great disruptor of value, worth and sustainable ecosystems. Now that AI is “in the mix”, it makes blockchain and decentralization that much more imperative. OpenAI’s DallE2 and ChatGPT3 were not the start of AI nor were they the beginning of the shift in digital systems, I mean they are 2 and 3 for a reason. But business models, employment models, governance models all have found homes on the blockchain and I see that potentially increasing, with systems getting fast, smarter, more intricate and exquisite and permeating on your data. That’s another conversation for another day but data and data privacy are definitely things the blockchain can help with as well as redistribution of ownership of your data to you rather than having you be a consumed entity.

🐾Conclusion: A Pathway to Decentralized Growth

Blockchain technology offers a transformative path for organizations to remain aligned with their mission, goals, and members. By embracing DAOs and DACs, organizations can reduce hierarchies, foster fiscal transparency, and enable real-time decision-making based on collective input. Blockchain technology ensures that every action, transaction, and decision is transparent, secure, and accountable.

As we move forward, organizations that adopt blockchain will find themselves not only more aligned with their communities but also more adaptable and resilient in the face of change. The decentralized future is here, and for organizations willing to embrace it, the possibilities are endless. Change is in the air—let’s breathe it in.