It sounds like one of Aesop’s fables, but it’s a good lesson for those of us interested in ever becoming involved in any business of any kind… which is probably most of us.
The catchy title is actually an analogy for two contrasting business models:
1. The Spider: Centralized, CEO-led companies that operate with a hierarchy of power based on a set of rules to produce a profit
Examples: GM, Ford, MGM, and pretty much most big businesses
2. The Starfish: Decentralized, member-led organizations that thrive based on mutual participation and trust to further a shared ideology
Examples: eMule, Skype, craigslist, al Qaeda, Alcoholics Anonymous, Wikipedia, the Internet
“One thing that business, institutions, governments and key individuals will have to realize is spiders and starfish may look alike, but starfish have a miraculous quality to them. Cut off the leg of a spider, and you have a seven-legged creature on your hands; cut off its head and you have a dead spider. But cut off the arm of a starfish and it will grow a new one. Not only that, but the severed arm can grow an entirely new body. Starfish can achieve this feat because, unlike spiders, they are decentralized; every major organ is replicated across each arm.” – The Starfish & the Spider website
Authors Ori Brafman and Rod A. Beckstrom explain the basic make-up of “starfish” organizations and how they are impacting the “spiders” out there. Obviously, the music industry is freaking out that eMule is enabling users to have access to millions of dollars worth of music. AT&T was none too happy when Skype figured out how to allow people in England to talk to people in the US for free. While spider organizations are often very successful (duh), starfish can become a major threat to them. And starfish organizations can themselves be very successful: they grow, they can easily be started up anywhere at anytime by anyone, and if one small part dies, other parts will take its place. Starfish orgs are measured by their participation. So, Brafman and Beckstrom suggest, if you can’t beat ’em… join ’em?
Without criticizing spider orgs, the authors’ message seems to be that at the rate at which starfish organizations are springing up and being highly successful, it is crucial to learn about them and perhaps implement some of the starfish strategies. They discuss the “combo special”: companies that are spider-starfish hybrids. (Maybe the analogy isn’t so awesome here… can you imagine what those freaky animals would look like?) An example is eBay, which has a CEO & headquarters but is largely run by its members and continues to be used because people trust each other. The authors write: “eBay is a centralized company that decentralizes the customer experience.” Another example is Amazon. These hybrid companies are still able to make money and their popularity grows because they allow their users to participate in the running of the company.
The book is incredibly insightful and very easy to read – I finished it in two days and felt that I learned much useful information. You also can’t help but start to form your own creative business ideas as you read the book… Maybe The Starfish and the Spider is itself a catalyst for the spread of more starfish organizations.