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Ownership Design [Design
Posted on September 24, 2015 @ 10:18:00 AM by Paul Meagher

I was recently reading an interesting article by Peter Barnes called Common Wealth Trusts: Structures of Transition. Bill Mollison, the co-founder of Permaculture, has devoted considerable writing and discussion to Trusts as a good legal structure for communities to conduct business under so I'm always interested in learning more about Trusts and their potential. All public universities and major religious organizations, for example, are incorporated as Trust structures. It is a type of organizational structure that offers an appropriate "ownership design" in many cases. Bill would argue that it is a type of business/organizational structure that is not used enough.

Towards the end of Peter Barnes' article he mentions Marjorie Kelly and her well-received book Owning Our Future (2013).

I'm waiting for the book to come to my local university library but in the meantime I read the intro and first chapter which is available on her website (PDF link). A term she uses which strikes me as quite thought provoking is "Ownership Design" and she makes the point that there are many more ownership design options than capitalist ownership or communist ownership models. There is considerable innovation happening in the middle ground, such as Peter Barnes' call for Common Wealth Trusts.

There are many ways that an entrepreneur can innovate but generally we think about innovating in terms of product or service design and not really that much about ownership design. There are, however, lots of opportunities to innovate in terms of ownership design as well.

Some examples that come to mind can be found in farming entrepreneur Joel Salatin's book Everything I Want To Do is Illegal. In this book he recounts his many run ins with food inspectors who wanted to shut him down. Often the way he avoided prosecution was by tweaking the ownership design of his product. For example, if a side of beef is first sold to a customer and processed after that there are alot fewer food inspection people on your back than if you try to sell the processed meat directly to the customer. Or, if you want to drink raw dairy milk the only way you will generally be able to do so is if you own the cow through some form of ownership design that allows the farmer to take care of the animal but where they do not own it - you do.

Another example is computer software where you wonder whether you even own the software anymore with how intrusive software updates are (shutting down your machine in the middle of doing something). Apple has found a very lucrative model in retaining end-to-end ownership of their hardware and software but many other firms have found lucrative niches in giving away and opensourcing/commons licensing their software and hardware designs.

Finally, back to Peter Barnes and his observation that many corporations are acting as if they own the commons - the air, the water, the roads, and other public resources required to produce and distribute their goods. Their profits come in part because they are not paying sufficiently for the use of commons resources. The day might arrive when the public decides to assert public ownership of these commons resources and charge companies to use them with the revenues circulating back to the public. This is one scheme that could be used to reduce wealth inequality by assigning a price tag to the use of commons resources and distributing the wealth back to a public now asserting common ownership. Of course carbon taxes are a form of this but the revenues are not necessarily being used to reduce wealth inequality as Peter is suggesting we do.

Ownership design is a type of design that is worth adding to your business design toolkit. It has the potential to be as disruptive as any other form of design and can be used to solve problems that arise when a single company tries to own the whole value chain (e.g., Joel selling the animal to the customer before processing it), or are exploiting more than their fair share of commons resources, to create a better environment for workers, and in many other situations that are discussed in Marjorie Kelly's book.

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