[Reprint from Ted.com]
Author: Clay Shirky

In this prescient 2005 talk, Clay Shirky shows how closed groups and companies will give way to looser networks where small contributors have big roles and fluid cooperation replaces rigid planning.

How do groups get anything done? Right? How do you organize a group of individuals so that the output of the group is something coherent and of lasting value, instead of just being chaos? And the economic framing of that problem is called coordination costs. And a coordination cost is essentially all of the financial or institutional difficulties in arranging group output. And we’ve had a classic answer for coordination costs, which is, if you want to coordinate the work of a group of people, you start an institution, right? You raise some resources. You found something. It can be private or public. It can be for profit or not profit. It can be large or small. But you get these resources together. You found an institution, and you use the institution to coordinate the activities of the group.

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