The Open Organisation: Igniting Passion and Performance
“You can’t keep doing things the way you’ve always done them…You must knock down the walls of your organisation in ways that allow you to collaborate with your customers, vendors and partners” Jim Whitehurst
Red Hat has made its money by selling customers the peace of mind that their software – based on Linux open source code – is the most stable and secure system on the planet. In effect, customers know they can get the code – like tap water – for free but are happy to pay the premium for Red Hat Linux code that has been ‘bottled up’ and made safe. Linux itself was started as a hobby by Linus Tovarlds who famously wrote on a listserv note, ”hey everybody out there…I’m doing a free operating system…nothing professional”.
Linux software now runs everything from the most complex scientific computers to web servers, stock exchanges, military systems, cameras, refrigerators and mobile devices. It has been entirely created by thousands of people self-organising themselves into a collective. The virtual army fixes bugs, heads off hackers and collaborates to make it a stronger product. They are united by a compelling purpose to make the world a better place. Red Hat’s open source way of working means they can deliver innovation at a faster and less costly rate than traditional models. At first dismissed by Microsoft CEO Bill Gates, Red Hat now has annual revenues of over $2 billion, and 7,000 employees.
Red Hat CEO and author Jim Whitehurst wants to share how his own leadership changed following a conventional top-down role as a former COO of Delta Airlines. He also draws on how other organisations such as Google, The Body Shop, and Whole Foods are benefitting from working in an open way.
Whitehurst believes this unique approach to working – tapping into the talent and ideas that are both inside and outside of your organisation – will mean you won’t have to pedal harder just to keep up, but can accelerate your business, powered by new sources.
Examples of how open sourcing can work include:
- YouTube – where every minute, more than a hundred hours of content are posted
- Habitat for Humanity – which has helped more than four million people construct or preserve their homes through volunteer labour
- Wikipedia – with over five million articles on the English version alone, edited by anyone
Whitehurst believes that open organisations need to:
Be united and passionate about a common mission
Whitehurst first experienced this at Delta airlines when it was at risk of a takeover from a rival – it was this event that lit the passion in employees to fight off the threat and keep the business going. Whole Foods unites its employees behind the vision that they are helping people live healthier lives.
Companies need to have a goal in mind that transcends the profit motive – that’s the only way to attract the best and brightest talent. And it’s not enough just to have a purpose – you need passion to take the organisation to the next level. Red Hat achieves passion in its workforce every day by: encouraging emotion (for instance, by using the terms ‘I love this’, ‘I hate this’ ‘I’m excited or upset about this’); ideas; hiring passionate people (often found through Red Hat’s own staff who generally know other good people who will be a great culture fit); and showing personal passion.
They keep the passion ignited with a range of tactics such as quarterly videos showing individuals using open source for their own interests such as building a recording studio or community initiatives, viewed at a party for people to connect with each other, along with ‘We are Red Hat Week’ with the senior executives doing a silly skit, as a chance to bond with team-mates. Zappos also holds quarterly meetings that are like a high school play mixed with company updates and team performances that build loyalty and celebrate identity.
Leaders need to make themselves available for constant dialogue with employees. Red Hat uses surveys (Net Promoter Score) to measure how likely employees are to recommend services or working at Red Hat to an associate.
The answer to low morale is to focus on purpose, tools and engagement not directly on trying to make people happy. People need to believe the company and it’s leaders care about them. As Howard Behar, the former president of Starbucks said: ‘the person who sweeps the floor should choose the broom’. If things are going badly, say sorry, be honest, explain personally the situation, give lots of detail about the company’s direction, admit mistakes and be accessible. Peer to peer feedback – not just from managers from above – is encouraged – both the praise and calling out (in his words) – the bullshit in light-hearted ways.
A leader in an engaged organisation is accountable to everyone. Red Hat’s leaders are accountable for: knowing the strategy; listening; and engaging. The leader’s job is to not just explain what the company is doing but why we are doing it. At Delta, Whitehurst gave his email address to every employee and encouraged them to use it. At Red Hat he also holds informal town hall meetings to answer associate’s questions. Red Hat uses tools like good old-fashioned email and memolist to communicate and things such as instant messaging, elluminate (web conferencing that allows you to keep recorded presentations), etherpad/social intranet (such as Mojo), and video conferencing. They also have an open website – opensource.com – that supports the open source movement. The website uses volunteer moderators, many not even working for Red Hat. Whitehurst is not a fan of the traditional suggestion box – as so often nothing happens from it if HR leads it with no real engagement from the top.
Choose meritocracy, not democracy
Don’t use phrases like ‘the boss wants it this way’. Publicly recognise a great effort or contribution, and ask for feedback and ideas on a specific topic – respond to them all and implement the good ones. Reward a high-performing member of your team with an interesting assignment, even if it is not in his or her usual area.
Let the sparks fly
Whitehurst loves to argue – not maliciously but in a healthy way. Conventional organisations don’t generally encourage heated debates but the best ideas happen when teams hash things out passionately. Red Hat’s values are freedom, courage, commitment and accountability. Don’t let brainstorms encourage only positive feedback on ideas – when people challenge and debate each other’s ideas it generates substantially more new ideas.
Google relies on ‘Google Ideas’ – a web-based forum where employees regularly submit ideas on everything from product improvements to making the company a better place to work. The rest of the Google team then weighs in with opinions and trending debates are escalated to other communication levels in the company.
This sort of approach requires people to build a thicker skin. Start a debate and make sure nobody takes it personally. If forums don’t exist for healthy debates, create them. Pick neutral territory for franker dialogue, not the office home turf.
Make inclusive decisions
To help get started with this, when you make your next decision, reflect on whether it was influenced by others’ points of view. Asking one or two thought leaders their opinions on something you’re considering or pick an issue and openly discuss it with a broader group – after a while it will become natural. Observe the difference in execution of decisions that were made openly, rather than those that came from the top down.
When people first encounter the culture at Red Hat they are often surprised at the passion that unites its people. Finding a way to introduce the same depth of collaboration in your own organisation will not be easy, but lighting the fire and unleashing the talents of people inside and outside your business could be the key to staying in the game.
About the author
Jim Whitehurst is CEO of Red Hat, the largest open source software company in the world. Before joining Red Hat, Whitehurst held various positions at Delta Air Lines, most recently as Chief Operating Officer, responsible for operations, sales and customer service, network and revenue management, marketing, and corporate strategy. Prior to joining Delta, he was a Partner at The Boston Consulting Group (BCG) and held various leadership roles in BCG’s Chicago, Hong Kong, Shanghai, and Atlanta offices.
About Red Hat
Red Hat was established in 1993 using open source software and collaboration to create a subscription business model with revenues of over $2 billion. The company is listed on the New York Stock Exchange and more than 90% of Fortune 500 companies are customers. It has a growing list of services from middleware to virtualisation, training, and consulting.
“This is a great read for anyone hoping to lead and succeed in a society being redefined by expectations of transparency, authenticity, access—and yes, in a word, openness.”
Michael Dell, Chairman and CEO, Dell
“With The Open Organization, Whitehurst takes us where all leaders need to be if we want to succeed in the future—outside of our traditional comfort zones.”
John Chambers, Chairman and CEO, Cisco
CEO Jim Whitehurst’s “The Open Organization” is the best business book of the year.
Seeking Alpha (seekingalpha.com)
Author: Jim whitehurst