Hierarchies, relational contracts and new forms of outsourcing.

We observe that economic restructuring is significantly changing organizational governance. On the one hand, we witness an increase in mergers & acquisitions, which substitutes markets for hierarchies and, on the other hand, we see an increase in outsourcing and subcontracting activities, appearing to replace hierarchies by markets. However, there is evidence that an increasing part of outsourcing activities mix hierarchies with market forms of governance. The key argument of this paper is that firms have established governance structures based on markets, hierarchies and self-enforcing relational contracts so that they are able to keep a substantial amount of control despite of sourcing out labour. Furthermore, we argue that such hierarchical forms of outsourcing produce dependency. Using empirical evidence of the Austrian insurance industry, it is demonstrated that dependency is created, firstly, by the contractual restriction of alternative uses of resources, secondly, by support measures that bind the upstream party closely to the downstream party, thirdly, by relationship-specific investments made by the upstream party, and fourthly, by authority elements.

A Generic Model of Contracts for Embedded Systems

We present the mathematical foundations of the contract-based model developed in the framework of the SPEEDS project. SPEEDS aims at developing methods and tools to support "speculative design", a design methodology in which distributed designers develop different aspects of the overall system, in a concurrent but controlled way. Our generic mathematical model of contract supports this style of development. This is achieved by focusing on behaviors, by supporting the notion of "rich component" where diverse (functional and non-functional) aspects of the system can be considered and combined, by representing rich components via their set of associated contracts, and by formalizing the whole process of component composition

Blockchain, Leadership And Management: Business AS Usual Or Radical Disruption?

The Internet provided the world with interconnection. However, it did not provide it with trust. Trust is lacking everywhere in our society and is the reason for the existence of powerful intermediaries aggregating power. Trust is what prevents the digital world to take over. This has consequences for organisations: they are inefficient because time, energy, money and passion are wasted on verifying everything happens as decided. Managers play the role of intermediaries in such case: they connect experts with each others and instruct them of what to do. As a result, in our expert society, people's engagement is low because no one is there to inspire and empower them. In other words, our society faces an unprecedented lack of leadership. Provided all those shortcomings, the study imagines the potential repercussions, especially in the context of management, of implementing a blockchain infrastructure in any type of organisation. Indeed, the blockchain technology seems to be able to remedy to those issues, for this distributed and immutable ledger provides security, decentralisation and transparency. In the context of a blockchain economy, the findings show that value creation will be rearranged, with experts directly collaborating with each others, and hierarchy being eliminated. This could, in turn, render managers obsolete, as a blockchain infrastructure will automate most of the tasks. As a result, only a strong, action-oriented, leadership would maintain the organisation together. This leadership-in-action would consist in igniting people to take action; coach members of the organisations so that their contribution makes sense in the greater context of life

Enforcing Architectural Styles in Presence of Unexpected Distributed Reconfigurations

Architectural Design Rewriting (ADR, for short) is a rule-based formal framework for modelling the evolution of architectures of distributed systems. Rules allow ADR graphs to be refined. After equipping ADR with a simple logic, we equip rules with pre- and post-conditions; the former constraints the applicability of the rules while the later specifies properties of the resulting graphs. We give an algorithm to compute the weakest pre-condition out of a rule and its post-condition. On top of this algorithm, we design a simple methodology that allows us to select which rules can be applied at the architectural level to reconfigure a system so to regain its architectural style when it becomes compromised by unexpected run-time reconfigurations.Comment: In Proceedings ICE 2012, arXiv:1212.345

The quasi-judicial role of large retailers: An efficiency hypothesis of their relation with suppliers

The paper explores an efficiency hypothesis regarding the contractual process between large retailers, such as Wal-Mart and Carrefour, and their suppliers. The empirical evidence presented supports the idea that large retailers play a quasi-judicial role, acting as "courts of first instance" in their relationships with suppliers. In this role, large retailers adjust the terms of trade to on-going changes and sanction performance failures, sometimes delaying payments. A potential abuse of their position is limited by the need for re-contracting and preserving their reputations. Suppliers renew their confidence in their retailers on a yearly basis, through writing new contracts. This renovation contradicts the alternative hypothesis that suppliers are expropriated by large retailers as a consequence of specific investments.Retailing, distribution, contracts, transaction costs, self-enforcement

A Survey on Service Composition Middleware in Pervasive Environments

The development of pervasive computing has put the light on a challenging problem: how to dynamically compose services in heterogeneous and highly changing environments? We propose a survey that defines the service composition as a sequence of four steps: the translation, the generation, the evaluation, and finally the execution. With this powerful and simple model we describe the major service composition middleware. Then, a classification of these service composition middleware according to pervasive requirements - interoperability, discoverability, adaptability, context awareness, QoS management, security, spontaneous management, and autonomous management - is given. The classification highlights what has been done and what remains to do to develop the service composition in pervasive environments

Abstracting object interactions using composition filters

It is generally claimed that object-based models are very suitable for building distributed system architectures since object interactions follow the client-server model. To cope with the complexity of today's distributed systems, however, we think that high-level linguistic mechanisms are needed to effectively structure, abstract and reuse object interactions. For example, the conventional object-oriented model does not provide high-level language mechanisms to model layered system architectures. Moreover, we consider the message passing model of the conventional object-oriented model as being too low-level because it can only specify object interactions that involve two partner objects at a time and its semantics cannot be extended easily. This paper introduces Abstract Communication Types (ACTs), which are objects that abstract interactions among objects. ACTs make it easier to model layered communication architectures, to enforce the invariant behavior among objects, to reduce the complexity of programs by hiding the interaction details in separate modules and to improve reusability through the application of object-oriented principles to ACT classes. We illustrate the concept of ACTs using the composition filters model

Mechanisms of Endogenous Institutional Change

This paper proposes an analytical-cum-conceptual framework for understanding the nature of institutions as well as their changes. In doing so, it attempts to achieve two things: First, it proposes a way to reconcile an equilibrium (endogenous) view of institutions with the notion of agents’ bounded rationality by introducing such concepts as a summary representation of equilibrium as common knowledge of agents. Second, it specifies some generic mechanisms of institutional coherence and change -- overlapping social embededdness, Schumpeterian innovation in bundling games and dynamic institutional complementarities -- useful for understanding the dynamic interactions of economic, political, social and organizational factors.

The Role of Inter-Group Relationships in Institutional Analysis

Taking value as the socio-economic analogue of biological or cultural fitness, in this paper I start a study of the interaction between individual-level and group-level explanatory mechanisms by looking for what kind of intra-group relationships obtains given the nature of inter-group relationships. Specifically, it is shown that when value comes from appropriating resources from other groups, inter-group relationships are conflictual or war-like and, as a consequence, intra-group-relationships are centralized and hierarchical; when the value creation process involves niche-competition between groups, inter-group relationships are fission-fusion with commitment and intra-group relationships are decentralized and egalitarian; finally, when value comes from appropriating occasional benefits from cooperation, inter-group relationships are indistinguishable from intra-group relationships, and the latter are decentralized and hierarchical. Interpreting intra-group relationships as different forms of social order and the division of labour, applications to political and economic institutions are also provided. Exploitation, a well-defined concept in the paper without recourse to the labour theory of value, is shown to be consistent with some of these institutions and, particularly, with the absence of explicit coercionvalue, distribution, exploitation