Being big and being innovative
Large corporations, looking to embrace digital business models sometimes aspire to emulate startups in their culture. They should go even deeper, to the roots of what shaped many startups: the open source software model. Open Source is not only about free access to code. It is more fundamentally about governance and process based on free access to information: research, decisions and the processes by which these are formed and executed. In contrast, the structures of big organisations are often broken and the fix is readily available: stop hiding information!
There was a time when hierarchies were essential for creating an efficient flow of information up, down and across organisations. Managers were responsible for aggregating data upwards from their teams and for disseminating instructions downwards to their teams. Today, technology can manage information vastly more efficiently, and yet these structures persist. They are so hard to change, because they are the power structures of an organisation. The people who control information flows have immense power. With this great power comes great remuneration, but not always great value. While hierarchies were originally designed to lubricate the flow of information, they now largely serve to manipulate and constrain the flow of information at huge cost to the potential of corporations.
Big corporations are not at their core clumsy and slow. A better characterisation is that they are an immense wealth of expertise and client information that is the envy of even the most agile startup. Being clumsy and slow comes from a structure that limits insight, connectedness and thus the chance to create magic.
Make everything visible
If everyone in an organisation had access to the daily thoughts of decision makers, and had a chance to contribute efficiently to relevant decisions then the trade-offs that are being made every minute would be wiser. If every data point on clients was easy to access then solving client problems would be a natural result. This system of openness is what enables open source software to create such immense value often with little more than passion, a thirst to learn and a generosity to help others.
This is a radical position to take for traditional businesses. It means publishing every decision, opening up the deliberations behind them and ending the way meetings are currently used to control decisions. Data needs to be openly available to help teams make decisions. And most importantly a system of empowerment to propose and get work done, without the heavy overheads of people who manage portfolios of work. The required controls are clearly defined and transparent gates through which work must pass. It can be astounding to observe the efficiency in which gates are managed in open source teams and the extent to which they optimise value. Ubuntu is just one well known example at scale that has many interesting lessons. Does your playbook for team members to create value look this clear?
By connecting deep client insights with business expertise and engineering skill, amazing products can be created. This has been proven time and time again with open source projects, the largest of which have 10’s of thousands of contributors with exceptionally simple structures. Many of the great technology companies grew out of this culture.
Respect confidentiality
Of course, in corporations there is some information that is confidential and needs to be protected, but with modest effort and the smart use of technology, it is easy to manage data flow responsibly and reliably.
Leaders create work systems
The most successful organisations don’t fundamentally focus on creating great products. They focus on creating the work systems that create great products. At its heart, this is a radical adoption of honesty, transparency, discovery and humility. Creating work systems is not a task for traditional consultants who thrive on exploiting the inefficiencies in internal information flows — it is a task in which generous and skilled people step forward and lead and are permitted to lead.
Are you brave enough to step forward, empower all of those around you to step forward and “open up” your organisation?
