Contributions

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A contribution is an addition to a value stream of something to which we attribute value.

The NRP-VAS records activity of network affiliates in different types of processes. The recording is done through a process called logging. Logs are claims for revenue or fluid equity, in a value accounting system. A log becomes a contribution only under certain conditions. A log can be rejected for being a lousy or lossy use of time or resources, or simply for being fraudulent. This is how abuse or gaming is avoided.


We need to distinguish contribution from mere participation or attention (lesser modes of involvement).


In a value creation process we can have contributions and exchanges. Working for a company, in a classical setting, means that labour is exchanged for wages, thus the products of labour belong to the company. Working within an OVN means that labour is seen as part of a co-creation process, risk is shared, giving rights to future benefits/revenue generated for the lifetime of the product.


Contributions map individual assets. The main idea behind the open value network model is to allow individuals to invest with whatever they have, thus reducing the dependency on financial assets. This is the essence of commons-based peer production. Another way to see it, is that an OVN used an infrastructure (OVNi) that integrates crowdfunding (financial and material contributions) and crowdsourcing (time-based contributions) into one platform.


Basic principles that govern the validation of claims

Kurt proposed the following principle: A log of activity in the NRP-VAS is considered a contribution if it increases the probability to create something valuable.


A transferable contribution is something that can be shared and others can build upon.


See also Contributions log


Scope

from Yasir

There are three types of contributions: project-contribution, network-contribution, and commons-contribution. Project-contributions are those contributions that are applicable to the scope of the project; the governance of these contributions is defined at the project level. For instance, perishable or consumable materials could only be a part of the project. Network-contributions are those contributions that are applicable to the scope of the network; the governance of these contributions is defined at the network level. For instance: a physical tool can be shared across projects. Commons-contributions are those contributions that are applicable across networks; the governance of these contributions is defined at the global governance level. For instance: use of standards, legal framework and knowledge.

See more in Open Value Network: A framework for many-to-many innovation


Contribution at the project level

The aim of a project can be of a different type:

  • create exchange value: a product or a service,
  • create use value: for example a tool that network affiliates can use, or anyone else
  • create social value: for example help the unemployed, help with environmental issues, etc.

These contributions are activities that increase the probability to create value, in the context of the project.

  • it adds a new piece to the solution, or advances the process closer to the solution
  • it improves the process through which the solution is obtained or distributed,
  • it improves the solution (extends the functionality or the desirability of a product).
  • ...

R&D is a project-level activity.


Contributions at the open enterprise level

Activities that improve a value capturing mechanism, or that increase the market exchange volume, or simply that helps sustain the market exchange processes. These contributions can be of different types, defined by business operations like office work, outreach (marketing), sales, service, etc..

Some activities don’t leave material/tangible traces.

For example, if someone spends time reading a book he gets all the benefit, even if the book is related to work activities, unless he/she produces a summary and shares it with others. So the act of reading the book in itself should NOT constitute a contribution to a project.
Some can argue that by increasing ones knowledge one can become more efficient and will be able to add more value to the network. Hence, this activity should be rewarded within the value network. Therefore, the act of reading should constitute a contribution. But in that case, the gain in knowledge one gets from reading will pay off later when this knowledge will be turned into a concrete contribution, which would lead to double a reward. What if this individual ceases to participate in the value network immediately after reading the book?
If this someone decides to write a summary and shares it with others he provides real value to the network. Someone save time absorbing the essential from the book by reading this summary. Thus, the summary clearly has value, because it allows others to absorb the same knowledge faster and to turn it into tangible value for the network.


Another example would be a literature review on a particular subject. A documented synthesis of all the material read represents real value for the network. But if nothing is shared by the individual who performed the literature review no contribution can be claimed, because others cannot build on this work. The same applies to information mining.


Contributions at the network level

These are support contributions to sustain the network

  • They improve internal processes (for innovation, etc.),
  • They improve the visibility of the network (branding, communication) and its power of attraction (of resources), etc.


Example of support contributions: office work, branding and outreach for the OVN as a whole, infrastructure work (physical and/or virtual infrastructure), etc.


From the value accounting system perspective, support contributions should be rewarded from all projects that use the OVN platform, including the physical and virtual infrastructure, the OVN brand name, etc.


Contributions with respect to project cycle

Tibi proposed a way to structure contributions with respect to project cycles during the launch with Daniel of the FabMobile project of SENSORICA. The example below was applied in the case of a service, which doesn't require R&D or large sunk costs.

  • Startup contributions
    • Investment $ or material to allow the initiation of the project.
    • Investment in time to set up the project. Example, work done by all on website, initial outreach, etc..
{The results of startup contributions will be recycled in the life course of the project.}
  • Support contributions
    • Time and expense throughout the life time of the project that helps the project continue. these contributions are not specific to sales/exchange cycles. Examples: general outreach, administration, accounting, etc..
  • Rolling contributions
    • Time spent to enable every sales/exchange cycle.
    • Spendings in $ and materials for each sales cycle. Example: consumables and equipment to manufacture and deliver a product or a service.

At the value equation level, startup contributions are transformed into "debt", i.e. the project will pay the equivalent market value of the work plus a % to cover the risk. The payment would be made gradually, throughout multiple sales cycles, until the total amount is paid. See more on Examples of Past looking value equation

Support and Rolling contributions would be paid from every sales/exchange cycle, depending on the contribution.

NOTE: a similar structure can be proposed for research intensive projects, where R&D activities give fluid equity and are part of Startup contribution.


Properties of contributions

Continuity

Continuous

Daily, regular work that can be divided into tasks and sub-tasks, which piles up over time adding value to projects or to the entire enterprise. No clear deliverable, or deliverable is far in the future.

Ex. doing office work.

Continuous contributions are evaluated at a later time, after some accumulation, in the context of a project.


Discrete

A tangible contribution, something that can be easily recognized by others as valuable. A discrete contribution can be evaluated at the time it is made, based on apriori knowledge.

Ex. someone contributed with a new technology, invests cash money, shares an equipment,...


Materiality

Tangible

Time: some invest their time, using their skills to produce value. Time contributions can be described by

  • timestamp: the date and time when the contribution was made
  • duration: amount of time spent doing something
  • type of activities: ex. reading, writing, transporting, doing manual labor, doing R&D, programming...
  • associated project: the [project] is the context in which the activities are performed, and some projects have a path to market, which relates to potential revenue.
  • description: information giving more details on activities, in order to allow subjective evaluation in context.


Financial: some agents make direct financial contributions by purchasing materials used in projects, for example, or to build/maintain the infrastructure (paying rent for a space, ...). It can be described by:

  • timestamp: the date and time when the contribution was made
  • amount: face value
  • currency: currency type, ex. USD, CAD, EURO...
  • associated project: the [project] is the context in which the spending is made, and some projects have a path to market, which relates to potential revenue.
  • description: information giving more details on the spending.


Material: some agents donate materials that are used in projects or as part of the infrastructure. This type of contribution can be described by:

  • timestamp: the date and time when the contribution was made
  • amount: in the first implementation of the value system this contribution is quantified by using the market value (price) of the material contribution.
  • currency: currency type, ex. USD, CAD, EURO...
  • type: tool/instrument, equipment, consumable materials, etc.
  • associated project: the [project] is the context in which the spending is made, and some projects have a path to market, which relates to potential revenue.
  • description: information giving more details on the spending.

Agents can make material contributions by renouncing to ownership. In this case the material becomes part of the pool of shareables. The agent can also decide to share the material, for a limited time, under specific conditions, retaining ownership.


Space: Some agents share a physical space, to be used for projects as part of the physical infrastructure. Sharing a section of a website for outreach efforts for distribution of products is an example of a contribution with a virtual space.

Agents can decide to renounce ownership to their estate. In this case, the space becomes part of the commons, part of the physical infrastructure. The agent can also decide to share the space, for a limited time, under specific conditions, retaining ownership.


Intangible

Conceptual: some agents contribute with new concepts, ideas, opinions... These contributions can come as a punctual advice, in a timely manner, related to specific projects, or related to the value network in general.

Social capital: some agents can contribute by connecting the networks with other individuals or groups that will in turn contribute to the value network.

Information propagation: some agents can propagate information about activities through their own social networks.

Propose others...


Exchangibility

Transferable contributions

A contribution that leaves something behind that can be shared and that can can be used by someone else.


Non-transferable contributions

A contribution that increases the capacity of the group/network working on a project/product. This is creating latent value and can manifest itself into a more stimulating environment, better and larger network, etc.


Contribution modulators

Temporal aspects

It is important to understand how different aspects of the temporal distributions of contributions, extracted from the contributions log, can influence value creation within the value network. If a given aspect is found to influence value creation, we then need to design a set of incentives to favor the proper behavior.

On Mars 23, 2012 Tibi sent an email to SENSORICA proposing to extract 3 parameters from the temporal distribution of contributions, and add them as modulators of the value equation: seniority, regularity and commitment. This proposition generated a discussion and we realized that further analysis was needed.

Kurt proposed to change the name of seniority, we’ll render the concept more explicit and chose a different name [added by Tibi August 26, 2012].

The seniority factor was first advocated by Francois. Ivan was also in favor of it. Tibi was against it in the beginning, advancing the argument that seniority is naturally favorable to members (no need to formally take it into consideration), because the more time one spends within the network the higher the reputation, the greater the capacity to influence, which translates into a greater ability to generate and extract value. The concepts of regularity and commitment were introduced into the discussion by Kurt, I think.

Kurt proposed to define this parameter as continuous “membership” and maintained that seniority is not the proper term to use. He also pointed to a problem: “...people contributing early then taking off being credited with seniority””


We are now exploring:

  • earliness (related to the level of risk taken is investing early or later in a project),
  • homogeneity (a measure of consistency of contributions over time),
  • regularity (related to a stable pattern of contributions over time),
  • commitment (a measure of the density of contributions over time),
  • etc.

Logging of Contributions

Contributions to a project need to be recorded into the value accounting system. See Contributions log.


Ideas for development

See article https://docs.google.com/file/d/0BzrQyEif2HItbzczRFZmc1pieXc/edit


Praxis

In the current NRP-VAS used by SENSORICA a contribution is an Economic event.

See discussion about how to further structure contributions in Loomio.