Gary Hamel: Open source is one of the greatest management innovations of the 21st century


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My colleague John Adams, reporting from the World Business Forum in New York, wrote on Twitter that during his speech, management guru Gary Hamel called open source one of the greatest management innovations of the 21st century (coverage of Gary's speech here and here).

I love it. Gary Hamel is a hero of mine, and many consider him one of the greatest business minds on the planet. 

I knew Gary was familiar with open source after reading his book The Future of Management. He spends five pages (205-210 in the hardcover) discussing open source and at one point says the following:

The success of the open source software movement is the single most dramatic example of how an opt-in engagement model can mobilize human effort on a grand scale... It's little wonder that the success of open source has left a lot of senior executives slack-jawed. After all, it's tough for managers to understand a production process that doesn't rely on managers.

Here's his analysis of why the model works so well:

The OSS model also makes it easy for people to contribute. First, the raw material for creativity-- the code base-- is open to anyone. Second, there is no prejudice about who and who isn't qualified to contribute-- if your code measures up, you're good enough. And third, the approval process is transparent and largely apolitical.

And finally, and analysis of why this model works, despite the claims by many that an "opt-in" engagement model like open source can't be efficient.

It's true, self-direction may reduce efficiency, if by "efficiency" you mean the speed and economy with which individuals carry out work that has been assigned to them by others. By definition, if employees are working on things they care about, they may be giving less attention to the things their superiors care about. But this is a myopic definition of efficiency. It fails to account for the costs of malicious compliance when employees are ordered to do things they don't want to do. It ignores the bureaucratic overhead-- the reporting, auditing, and supervision-- that is necessary to keep people focused on things they find unrewarding. It doesn't include the potential value of all the discretionary effort that bored employees choose not to apply... So yes, there are efficiency advantages in doling out assignments from on high. But are they large enough to cover the costs of disenchanted and disengaged employees? I doubt it-- not in the long run.

I doubt it too, Gary. And I totally agree with you-- open source is one of the greatest management (and cultural) innovations of the 21st century. Software development is only the beginning. The open source way can be applied anywhere management innovation is needed. It's a 21st century world I'm looking forward to doing business in.

This article originally appeared on Dark Matter Matters.

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5 Comments

pchestek's picture
Open Minded

Gary Hamel seems to suggest the open source model only works because there's an objective way to measure how good a contribution is ("if your code measures up, you're good enough"). But in the Fedora Project, all work is developed the same way, even the classicly "artistic" work of graphic design. I'd love to hear more about how collaboration works even in the areas that are considered highly creative.

Mel Chua's picture

Code is also a creative endeavor - perhaps one we're more used to measuring against a (subjectively created!) list of objective requirements, though. Graphic design can have requirements too; color schemes to fit in with a brand, target audiences an image should work for, even things like i18n (if you put words in an image, it becomes extremely difficult to translate).

Maybe the requirement for a working open source model isn't being able to measure how good a contribution is, but whether it is good enough - a binary yes/no may be sufficient most of the time, with additional granularity on "quality assessment" icing on the cake that turns that from a "working open source model" to an improving one.

withoutfeathers's picture

I've been trying to get a conversation going in my company. The two points that I keep coming back to -- because they seem to pique the most interest -- are collaboration and participation.

We keep hearing from the top that all of our processes are just too expensive and the only way to control costs is to cut payroll and "waste" -- whatever that is.

To me it looks like the big drags on efficiency (here) are weak collaboration among stakeholders and the "waste" of untapped talent due to ironclad boundaries between departments and jobs. We could do a lot to improve on both counts by embracing social networking and "open source software" type contributions. The tools already exist to do that. They just need to be employed.

cgrams's picture
Open Source Champion

Hi there, Without Feathers! Not sure if you've seen this yet, but Gary Hamel has a document that is a perfect conversation starter for the sort of conversation about changes that need to be made to the old management model you suggest. It's called "Moon Shots for Management"-- unfortunately you'll have to buy it from HBR, but I've found that executives respond really well to the ideas in it... Preview here. http://hbr.org/2009/02/moon-shots-for-management/ar/1

Kill OS's picture

I believe that open source is just the natural evolution of software in the 21st century. Initially, the software was naturally free, but eventually things were simply changing to a business model that simply does not work in current times.
Internet change the game field too much, and I think we are returning to the primordial spirit of what computer science was, that spirit of cooperation than we see in today's free software projects.