We have a lot of experiences in offline business organizations. We notice that those organizations are subject to corruption due to their centralized multi-layers business model which includes franchise and membership. This creates misalignment between the benefits of the central authorities (on the top of the pyramid) and the individual members of the organization. Luckily, we also see how decentralization and distributed ledger technology (eg. blockchain) can create a brand new kind of offline-to-online business organizations. I will dig it out piece by piece.

Some business organizations use a kind of exclusivity as a selling point. For example, they claim that in each of their smaller unit (eg. a chapter) only one member per business category can join the chapter. Let’s recall this graph on my first post of this series “The Giver Mindset on Forbole“:

FRN - Referral Community

It looks great! Now each member comes from a different profession and hence they will not compete with each other. For example, all the insurance-related referrals from the other eight members will go to the only member who is the insurance agent.

But this is just a gimmick for the top-tier franchise owners to sell the franchise to their downline. It provides the downline franchisees a good selling point to acquire members and earn the membership fee.

Exclusivity is an illusion.

Firstly, if the members are experienced networkers, they should have their own preferred choices of insurance agents or other service vendors. Unless there are stringent and enforceable rules, a business organization will not be able to force the members to treat each other as their sole or preferred choice of vendors. Secondly, being a member in an organization does not make you a reliable service provider. Will you choose a service provider just because he is belong to your organization, even you know he is not reliable?

We all have our own preferences.

This fake exclusivity does not worth its price (the membership fee and the time cost). Members should focus on building their personal brands and reputations, and help each other to spread the words out. To empower this, a business organization should be as inclusive as possible rather than exclusive. The more inclusive the organization is, the more diversified it members are and hence this can really help to spread the reputations of each quality members and help them to obtain more referrals.

To achieve this, a business organization need to manage both the offline and online presences by removing the hindrances to inclusion and diversity. Here are some measures we at Forbole Referral Network (“FRN”) will take:

1. Remove the concept of “chapter” which is static. Even children know how to make groups. Members of the organization will gradually and spontaneously form their own small groups according to their own characteristics, resources and needs. Groups need to be dynamic to cope with the rapid change of the business environment.

2. Remove the regular, frequent and boring meetings which are standardized with brainwash-style.

3. Focus on the commitment to the members, not the commitment to the centralized authorities.

4. Adopt an offline-online-offline approach to balance the need for real and authentic interaction (offline) and efficient virality (online).

5. Introduce a brand new business model by redefining members to become the owners of the community through the use of gift economy and decentralized governance powered by blockchain.

We will explain each of the above measures in more details later on.

(this article is subject to further modifications)

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