How is the story of Bitcoin a lesson in leadership?

Have you heard of bitcoin? It is a cyber-currency independent from banks, states and financial systems. As such, its value relies purely on people’s confidence in it and a demand for it.

The e-currency is a brainchild of an anonymous cryptographer operating under the name of Satoshi Nakamoto, who mobilised a community of talented coders (many of them cyberpunks) to participate in the creation of this revolutionary idea.

The whole system, operating since the release of the first bitcoins in 2009 is self-managing and relies on crowdsourcing to verify every bitcoin transaction.

Twenty five new coins and a small fee are being released to the miner (or miners) every time a block of the most recent transactions is complete and a complex mathematical puzzle unique to that block is solved. Bitcoin has been modelled on gold and designed on the premise of limited resources. The last, 21,000,000st bitcoin will be issued in around 2041.

The digital currency has made headlines when its value skyrocketed to over $1000 per bitcoin in December 2013 prompting speculations in relation to the anonymous founder (and the alleged owner of at least one million bitcoins).

The story of bitcoin is inspiring on many levels: one man taking on the financial system; the power of modern technology; the strength of the internet community. But to me, the bitcoin story is a fascinating lesson in leadership.

Common vision and goals matter. The people gathered to work on bitcoin shared the founder’s cyberpunk idea of a system devoid of central control.

Provided you have an inspiring vision you can achieve your goal on a low budget. A group of cryptographers working on bitcoin did not do it for a financial gain but out of desire to participate in a project so innovative and revolutionary that it may, in the fullness of time, have an impact on a global economy and world financial systems.

If financial rewards you offer are meagre you need a clear vision to attract and drive people.

Incorporate benefiting community into your vision and goals. Bitcoin founders have worked relentlessly with no clear prospect of success or gain, driven by the vision of handing the control back to the community and away from the financial institutions. They found the financial system, with its profit seeking at the cost of security of customers’ money, deeply flawed.

Think how you can incorporate benefiting the community and contributing to the common good in your vision and goals to give them broader appeal.

Design your organisation in a way which self-controls and self-manages. Cryptographers involved in creation of bitcoin did not like the idea of any central control or central administration necessitating overhead costs. They designed the system in a way that it self-manages relying on a series of algorythms and bitcoin miners (the only ones with the right to “mine” bitcoins) to verify bitcoin transactions. Similar principles can be applied in organisations:

– To keep things lean resources can be deployed only as and when needed;

– By enabling self-service facilities certain processes can be completed without the need for overheads.

– Giving staff constant access to feedback (e.g. live performance stats) will motivate them to self-correct immediately, without the need for a management intervention.

– In the areas where controls need to be tightened or improvements made, create interesting projects and use of volunteers from across the organisation to fix them.

Have you got any other ideas inspired by the bitcoin story? Get in touch by email: info@expansa.co.uk or call on 07789095897, I am very much interested to hear them.

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