First Protocol Reading Group: Exit to Protocol

Open invite! We’ll be reading and discussing Exit to Protocol

Reading: Exit to Protocol - Summer of Protocols

Update: Decided to move convo offline

My $0.02 is that Shuya is onto something big with how people’s continued adherence to protocol causes those protocols to persist for longer than their useful life. I could see how that could become even a multi-generational problem and waste of resources

I really enjoyed reading this essay. It spurred a few disparate thoughts:

Viewing organizations as a collection of protocols makes them look more organic than the traditional view, as a group of resources and assets. It becomes easier to see the flow of interactions that constitute the institution, allowing better analysis and troubleshooting. This is because a broader range of interactions are considered when looking at behaviours impacting the organizations outcomes. Traditionally organizations have official procedures and unofficial procedures, and unofficial procedures are often ignored whether they are beneficial or not. For example, an email is commonly considered an official message where as a slack message may not be, or a JIRA ticket is official where as a DM to do a task is not. A lot of interactions are neglected in this perspective. When viewing them all as protocols we give them some rigidity allowing us to interact with them, we can then acknowledge, modify, or remove as necessary.

There may be an inevitable protocol ossification process that occurs if a organization reaches a certain size. During its most rapid period of growth the protocols in place will be regarded as crucial, whether they were helpful or harmful. Due to the complex interaction of these protocols it would be hard to measure the impact each protocol has in isolation. Leading to the old marketing adage “half the marketing budget is wasted, but we don’t know what half”, here a large chunk of protocols are problematic but we don’t know which. There would be a lot of resistance to test these protocols impact as they were present during the organizations greatest growth. Something akin to the “Chaos Monkey” tool may help indicate the criticality of a protocol. Randomly shutting down a slack channel for a few hours, or moving the water cooler to the supplies room, etc.

Executives are hesitant to make bold decisions as inevitably the consequences would be placed on their shoulders, often they like to remediate this issue by borrowing strategies from other successful companies, so if they do fail they are not completely at fault. As mentioned in the essay “intellectual assets” have become the most strategic assets, so very few protocols are shared publicly, resulting in companies recycling the same few protocols released by successful organizations, leading to protocol ossification (eg. “The Agile Industrial Complex”). This is where the “Exit to Protocol” has an enormous impact, by providing a validated set of protocols a new spectrum of potential protocols are realized. Executives can experiment with anything in range from their current protocols with small tweaks to the full implementation of a protocol from the “whale fall”, with limited liability.


I think there’s an interesting parallel to Coase here, who conceptualized the firm as a collection of contracts. Healthy firms ensure contracts are aligned with organization’s goals through close collaboration between line managers, legal teams, and senior leadership.

Two things make contracts less likely to persist when no longer useful than protocols:

  1. Cost: Contracts are very expensive to administer, which reduces the incentive of maintaining misaligned contracts.
  2. Accountability: Contracts explicitly assign accountable parties, making it easy to find and blame the people behind mis-aligned contracts.

Protocols, with cost and accountability (say L1s) the other hand, have similar incentives to ensure protocols stay aligned with community needs.

To the extent that protocols prioritize accessibility, in cost and administration, they undermine the most straightforward accountability levers for ensuring community alignment.



Plus this

Leads to a couple interesting ideas:

  1. In industries with large firms, copy-pasting protocols leads to the gradual erosion of accountability. Large firms trend towards misalignment with their stakeholders.
  2. What happens with firms that have open business/protocol models? (e.g. PostHog, which has most of its internal docs publicly available, minus financials)

Interesting. Gitlab and Basecamp are also good examples for #2.

What sort of outcomes for “open protocol” companies would be relevant to this community?

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