The Open Organization: A book review by Bob Morris

Open OrganizationThe Open Organization: Igniting Passion and Performance
Jim Whitehurst
Harvard Business Review Press (2015)

How and why to focus everyone’s attention on what is most important, doing so with passion to achieve breakthrough results

Almost everything I know about the “open” concept and mindset I have learned from Henry Chesbrough and Linus Torvalds. According to Chesbrough in Open Business Models (2006), for example, “A business model performs two important functions: it creates value and it captures a portion of that value. It creates value by defining a series of activities from raw materials through to the final consumer that will yield a new product or service with value being added throughout the various activities. The business model captures value by establishing a unique resource, asset, or position within that series of activities, where the firm enjoys a competitive advantage.”

Having thus established a frame-of-reference, Chesbrough continues: “An open business model uses this new division of innovation labor – both in the creation of value and in the capture of a portion of that value. Open models create value by leveraging many more ideas, due to their inclusion of a variety of external concepts. Open models can also enable greater value capture, by using a key asset, resource, or position not only in the company’s own business model but also in other companies businesses.”

Jim Whitehurst is the CEO of Red Hat, the largest open source software company in the world. He and Red Hat demonstrate what Chesbrough describes in these brief excerpts. As Whitehurst explains, open source “successfully harnesses the power and commitment of talent and engagers that talent in an ongoing way over time.” That is, “the term ‘open source’ is traditionally used in the software arena [e.g. Linux] and designates a process in which anyone can contribute to or access code, unlike traditional software development, which is proprietary and owned by the company that produces it and governed by international property la=w. In open source, those who do the work volunteer their time and effort, and these volunteer, participative communities are both long running and capable of tackling multiple problems and opportunities simultaneously.”

Almost everything Whitehurst has learned about all this is shared in this book, thereby demonstrating the “open” concept and mindset.

These are among the dozens of passages of greatest interest and value to me, also listed to suggest the scope of Whitehurst’s coverage:

o Gary Hamel’a Foreword (Pages ix-xiv)
o The Open Organization (8-11)
o Leading the Open Organization (11-15)
o Conscious Capitalism: It Starts with a Purpose (27-32)
o The Leader’s Role: Leading a Passionate Organization (34-52)
o The Power of Engagement (58-65)
o Leveraging 360-Degree Accountability (65-72)
o The Leader’s Role: Scaling Up Engagement (72-78)
o It’s Not a Democracy (87-90)
o Building a Culture of Thought Leaders (93-97)
o Beyond Brainstorming (112-118)
o Adopting a New Mind-Set (118-123)
o The Leader’s Role: Knocking Down Barriers to Collaboration (126-131)
o The Power of Including Others (137-149)
o Slower Decisions Lead to Faster Results (152-157)
o Introducing the Catalyst in Chief (164-166)
o The Leader’s Role: Leverage Your Soap Box (166-179)
o The Boundaries of Participative Organizations (183-187)
o There’s No Going Back (188-192)
o Learning from Linux (196-202)

These are among the reasons that I find the open concept so exciting in terms of what is yet possible in the evolution of two terms, workforce and workplace.

1. It eliminates limits on who can be involved.
2. It also eliminates limits on what each participant can contribute.
3. The focus is on collaboration and, especially, on collective judgment.
4. Success of the given initiative has higher priority than does anything else.
5. There is accountability at both the individual and group levels.
6. Influence will be determined by value added in a pure meritocracy.
7. Leaders are selected by those led. (See #6)
8. Leadership nourishes passion, scales engagement, eliminates barriers, and leverages the group’s “soap box” (i.e. collective strength).
9. Resources are distributed with market-like mechanisms.
10 “Why” matters much more than “what.”

It is no coincidence that most of the companies annually ranked among those that are most highly admired and best to work for (e.g. The Container Store, W.L. Gore, Pixar, Red Hat, Whole Foods, and Zappos) are also ranked among those that are most profitable and have the greatest cap value in their competitive marketplace. In ways and to the extent that are appropriate to their needs, goals, and resources, all are open organizations.

Jim Whitehurst encourages those who read this book to check out and join the discussion “of what is possible when you open yourself to the possibilities of working in an open source way.” I agree with him, as do Chesbrough and Torvalds, that business leaders must put aside conventional thinking “and begin to tap into the power of participative communities in all aspects of our lives and businesses.” The potential really is limitless.

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