Sprint 4 - Inducing Network Effects

Sprint Objective – To analyse value exchanges between interdependent actors, appreciate interconnected network effects and identify actions to increase and improve interactions.

Networks are everywhere, every system is a network. With an emerging picture of who the key actors are related to the big question, we now need to deliberate what each may want to get from and give to the others (value exchanges). While reflecting on value exchanges, a few points to note are:

• Value that can be exchanged in an interaction could be various assets such as information, trust, knowledge, capital and more. What an actor gives and gets may not be the same thing. For example, Actor X could give information and receive trust from Actor Y in exchange.

• Gives and gets don’t necessarily flow between the same two actors but across the network of actors. For example, Actor X may give training to Actor Y and Actor Y could further train Actor Z. Or Actor X may give training to Actor Y and receive the funding to do so from Actor Z.

• Value doesn’t need to be exchanged just between actors across different sets of your strategy map, it can be within the same set. For example, all the actors of type X can exchange value between each other, say a farmer exchanging knowledge with another farmer.

Value exchanges, when increased and improved, induce network effects. Network effects happen when every time a new actor joins the network, it increases the potential value for all other actors in the network. This creates momentum such that the collective impact is greater than the sum of individual actions. In a network, network effects happen when value is exchanged in three typical patterns:

• Linear: Where one central actor disseminates information / services to many other actors. Think of the radio or newspapers. Even when new actors join the network, the value exchange stays the same as it is created and distributed only by the central actor. This is known as Sarnoff’s Law.

• Quadratic: Where one central actor hosts the infrastructure to facilitate interactions between other actors. Think telephones or YouTube. Every interaction of actors in the network adds value to other actors and the network grows as interactions increase. This is known as Metcalfe’s Law.

• Exponential: Where there is no single central actor but an ecosystem of actors enables value exchange in a network by infusing trust, reducing the complexity of coordination and eliminating the friction to engage and take action. Think the Internet or movements. Actors may self-organise into groups that create and exchange value in infinite ways. This is known as Reed’s Law.

Once we identify what kind of value exchange to facilitate and which type of network effects to induce, we consider the difficulty with initial and sustained adoption. The challenges could look like (but not limited to) having very few actors in the network, sparse interactions between these actors and ineffective instances of value exchange to attract new ones to join. In this sprint, we will identify the actions / initiatives to continuously energise the network and overcome these difficulties.

Reimagining Education Leadership

To better appreciate the sprint journey, we are following the story of how ShikshaLokam has been developing 4.5 million education system leaders in India. For this sprint, we will illustrate how ShikshaLokam facilitated value exchanges between key actors and induced network effects.

Having mapped key ecosystem actors, understood their cares and concerns, and assessed available resources, the ShikshaLokam team set out to uncover what these actors could give to and get from one another. By listening deeply to participants through workshops, field immersions and programme pilots, they found out needs such as recognition, peer support and tools to improve teacher learning. With government functionaries, ShikshaLokam engaged through formal consultations and co-design sessions. During these, they understood needs such as scale, cost effectiveness and data-driven decision making. Through convenings and spaces for collaboration, ShikshaLokam learnt the needs of civil society organisations. These included credibility, amplification of their interventions and access to State systems. Finally, they spoke to funders, thinkers and technology partners, who highlighted needs such as measurable impact, reusable infrastructure and opportunities for innovation.

By stitching these insights together, ShikshaLokam developed a give-get matrix. Schools give contextual insights and get capacity and recognition. Governments give reach and legitimacy at scale and get lower-cost, higher-quality leadership programs. Civil society organisations give innovative solutions and get amplification of their programmes. Funders give capital and get the ability to influence systems change. Technology partners give open-source infrastructure and get real-world use cases.

With clarity on value exchanges to be improved and increased, ShikshaLokam set about energising the network. There were few actors in the network, limited interactions and little recognition for leadership as a lever for education system change. To overcome challenges with adoption, ShikshaLokam evaluated a combination of strategies. These included creating a learning platform for education leaders, seeding courses and resources, creating a sandbox and prototyping what leadership development could look like in the public education system, leveraging existing networks such as that of DIKSHA, co-creating with civil society organisations already working at the state-level, and more.

As the central hub knitting all the ecosystem actors together and offering assets to use and build upon, ShikshaLokam was initially following Sarnoff’s Law. As they explored co-creation with other organisations, they soon began shifting towards a network corresponding to Metcalfe’s Law. Next, they thought about creating pathways for key ecosystem actors to co-create… More in the next sprint!

Now to Prepare for Our Sprint Together… Please reflect on these questions from your perspective.

• What value exchanges between actors do you want to increase or improve?

• Which law (Sarnoff / Metcalfe / Reed) describes which part of your network?

• What challenges may you face while energising / activating your network?