(2025-12-07) Zero Distance

Boundaryless wrote: "This week we’ve been reading Merrelyn Emery’s “Zero distance between organization and customer: a case of mistaken identity”, a critique of the Haier / ZeroDX narrative. Emery - a co-author of Open Systems Theory – pioneered work on socio-technical systems in the 70s with her husband, Fred Emery.*

In the paper, she argues that what’s really at work in Haier is not some new “zero distance” magic, but the old sociotechnical Design Principle 2 (DP2): the idea of having an organization made of groups that are substantially autonomous (autonomy) in delivering value (redundancy of function), and can develop intrinsic motivation. “Zero distance to the customer” in the sense of “be close to users” is, as she notes, almost a truism – any firm that ignores customers goes broke.

At Boundaryless, we largely agree with seeing RenDanHeYi as a DP2 implemention at industrial scale through networks of micro-enterprises (we said that already in 2023). (network economy)

Emery may miss slightly the point on what happens when you remove the managerial layer that traditionally mediates between owners and teams.

Haier replaced the managerial layer relationship with a dense web of contracts between micro-enterprises, platforms and partners. These contracts both stabilise the rules of the game (no one can arbitrarily rewrite them from above) and make customer accountability structural, not just cultural.

RenDanHeYi's contractual and organizational structure gives teams a viable path to market driven autonomy. In many DP2-style organizations, when teams spot new value at the edge, they remain trapped in the complexity of the system.

In this sense, RenDanHeYi is not “just DP2”; it’s DP2 plus a contractual architecture that allows customer-centric teams to emerge, grow, and emancipate themselves. That, we think, is where Haier’s experience genuinely extends classic OST.

Simone Cicero commented: "The first time I encountered #OpenSystemsTheory (thanks, João and Trond!), I was amazed, actually, by how much it resonates with #RenDanHeYi more and beyond more generally the idea of a #ProductOperatingModel.

I think a more honest conversation about the real depth #RenDanHeYi has brought to the table may help us go beyond superficiality to the radical root of the innovation: not just a topology centered on independent product/service providers (micro-enterprises), but the pervasive adoption of contracting at scale.