Open Thread Thursday | Business: Can the truth really set you free?

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Open Thread Thursday
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There's a lot of talk about openness and transparency in the world of business these days. So we wanted to ask: What does it really mean to be an open company? Where are you seeing companies act in a more open way? And where do you think companies can benefit most from transparency?

We'd love to hear your stories. Share your thoughts below. You can also discuss them with us on the freenode IRC channel #opensource.com.

Want to suggest a future Open Thread Thursday topic for the business channel? Post your ideas below, or if send them to us here.

 

 

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Jonathan Opp
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I am President + Partner at New Kind, a branding agency that specializes in helping open source and SaaS technology companies grow. Formerly Sr. Manager, Brand Communications + Design at Red Hat, and prior to that, held communications roles at IBM and Gateway. Find Jonathan on LinkedIn.
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15 Comments

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Rebecca Fernandez | January 28, 2010
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I never fully appreciated the value of transparency until I did some contract work for an ad agency that wanted me to avoid disclosing to their clients that I was a contractor, not an employee. It was... awkward. I had to watch my words very carefully, and meetings were incredibly strange--I'd show up at the office and have to remember not to greet the employees as if I hadn't seen them in a while, etc.

Then, the paranoia that I'd market my services to their client meant that my contact with the client was far too limited to effectively provide my services to them.

Ultimately, I chose not to work with the agency again.

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Colin Dodd | January 28, 2010
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Transparency is obviously good business in that it builds trust between you and the people you do business with. That trust has a real value.

But it also "feels good" if you are working for a company that has everything on the table, when you know what's going on, and why. It's a sense of being respected, and trusted. You know you are valuable when you are trusted in that way. It makes you work harder and more earnestly. I don't know if there are any studies or data to back this up, but in my own experience, I know that it increases productivity. It gives workers a stake in what is happening beyond meeting deadlines and collecting a paycheck.

And when you know what is going on, and why, you are more apt to make more relevant contributions and do things that actually move your company forward. It's nice to put your creativity into actual work, rather than guessing what you should do based on incomplete information.

Feeling good, respected, valued and trusted when you sit down at your desk just makes everything easier.

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Ruth Suehle | January 28, 2010
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Operating an open company has two directions: openness within the company, and openness to those outside. I wonder if they always come together, or if many are more open in one direction than the other?

Openness within the company is more dependent on factors like the topic in question. Are there areas in the company that can't be open? Most people would think first with HR, and they do have federal regulations about things that can't be shared. But I worked at one company where performance reviews were a group activity. (In this case, the execution was terrible, but I can see the benefits if it were done with good intentions.) And <a href="http://positivesharing.com/2006/08/why-secret-salaries-are-a-baaaaaad-idea/">this article</a> mentions a company that found so much success in being open with salaries that the resulting accountability is enough to allow employees to <em>set their own salaries.</em>

Then there's the question of external openness. And that's first driven by whether it's a public company or not and what sort of business the companies are in. Overall though, I think that historically, companies have nearly always had more luck in erring on the side of open. But presumably trade secrets still have a place? And then there's Apple, the company that has practically made an art form out of pre-launch secrecy.

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Unidentified | January 28, 2010
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transparency is no more than common sense during all business activities, it involves respect and openess between all involved parts
such concept is hard to archieve, or maybe impossible in some places, like mine for example (it's a surreal working place where people acts like strangers :D)
collaboration or cooperation are the key for getting in the correct path, but only with new people and starting in top-down way

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Tony O'Driscoll | January 28, 2010
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As I have had the good fortune of delving more deeply into what makes a volunteer community such as Fedora tick, my mind keeps wanting to sort out correlation and causality.

Those who participate voluntarily in communities talk about how they value about Openness, Transparency, and Meritocracy. There are no secrets, everything is done in the open. Decisions and Actions are transparent. And if you contribute in a way that the community values your reputational captial within the community grows.

Authenticity is another term that comes up a lot in exploring the special-sauce that fuels the community. Authenticity gets closer to the word TRUTH that we are exploring today. The term that, anecdotally at least, seems to be most ushered when talking to volunteer collaboratives engaged in social production is TRUST.

One of the questions we are trying to get to the bottom of at the Center for IT and Media at Fuqua is what drives what? How do the different factors that community members value load onto a comprehensive "Architecture of Participation" and what is the causal model through which social production is enacted?

Is it that foundational community norms of OPENNESS and TRANSPARENCY force us to be more Truthful or do we all inherently adhere to the belief that "THE TRUTH SHALL SET YOU FREE" and the community norms are enabling mechanisms to actualize it.

Right now we are in the process of running the empirical study to try to figure some of this out....... Stay tuned: )

My own hypothesis around this is that truth is foundational and enabling to the other values mentioned here. If you are transparent and open in a mis-truth, chances are that you will end up getting busted. Gamers who "Level Up" and buy characters on auctions rather than grinding through levels to earn their status are quickly found out by fellow Guild members and banished from the Guild.

The article that Ruth mentions above regarding open salaries is another example. I remember in the early days of Web 1.0 seeing a commercial where a young intern hacks the network and sends an e-mail to the whole company sharing everyone's salary. That commercial was designed to create Fear, Uncertainty and Doubt (FUD) within the HR community and motivate them to pay for more secure systems that stood lesser chance of being hacked. And yet, if the evaluation of a person's contribution is made more inclusive, open and ongoing, the likelihood of a much more honest assessment of the individual's capability and contribution goes up. In each case what seems to underpin things like Openness, Transparency and Meritocracy is the search for the TRUTH.

Those of you familiar with the JoHari window will know that by opening up what is not to others about oneself and by being open to others what is not known to them about themselves is how Trust is built. In both cases this requires truthfulness delivered in an open and transparent way.

Time will tell if my hypothesis bares out....but for now let please let me know my blind spots.

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Tony O'Driscoll | January 28, 2010
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Another thought I had on this topic has to do with something that Ruth mentioned earlier. It has to do with where the boundaries of Openness and Transparency lie.

Traditionally (but less so these days) the biggest organizational boundary was drawn between the company and the customer. More and more the lines between the enterprise and its stakeholders (Customer, Shareholder, Employee, Supplier, Competitor, Complementor etc....) are becoming increasingly porus.

The business ecosystem is becoming more open and the entities within it are more connected than ever! Knowingly or not, when CIOs brought the IP network into their enterprise infrastructures, they began the slow dissolve of the traditional hierarchal structure of the organization.

If you bolt on a technology built as a non-hierarchical communication platform to allow communications across the nation in case of nuclear war, you end up with a technical infrastructure that fundamentally orthogonal to your enterprise decision-making structure. So as the web has enveloped the world and made it flat, so too we have witnessed organizations become flatter and more connected than before.

So this is all good right. The truth sets you free and the Web 2.0 participatory web is dissolving hierarchy at national and industry levels. Push the fast forward button and we will have a billion one person enterprises coalescing around endeavor at the speed of light, doing exactly what they are good and and passionate about and getting paid handsomely for doing so? Not so fast.....someone has to clean the toilet!

Clearly there are solid benefits to openness and transparency within the firm. There were a few articles in "What we're Reading" that pointed to Jack Stack's Open Book Management approach and how it can help employees feel more engaged in the business. So in terms of alignment and orchestration of capability and energy around strategic endeavor there is likely value to be created in openness and transparency.

But what about outside the company? Should GSK open its books to Merck so they can see exactly where they are spending their money and what profit they are making on Malaria vaccines? This is something that Andrew Witty no doubt pondered deeply before making his decision.

What about Apple. Are they closed or open? Closed of course! And that is bad right? ....... Well it looks like the Jury is out. Another article in What We're Reading explores the Apple Paradox: How a Company That's So Closed can Foster So Much Open Innovation.

The central argument of the article is here:

The paradox—and it may be one that goes to the heart of digital-age capitalism—is that Apple’s style of closed innovation results in technology that is so conducive to open innovation.....It’s conceivable, though it’s not very palatable to the “open culture” crowd, that a closed creative process, driven by a guiding genius like Jobs, is the only way to build products as coherent and compelling as the iPhone. I’m sure this would be Jobs’ own argument. After all, without the solid foundation provided by the phone and its core features—the multitouch interface, the camera, the accelerometer, the GPS chip—most iPhone apps would be nothing special.

So when it comes to setting direction and blazing a new trail, the more open and democratic process can bog down the process of taking the bold step to change directions.

Last night in the State of the Union, Obama appeared to be saying the same thing. Why are we waiting? China and India are not waiting to retool their economies....why is America seemingly settling for second best?

In a recent interview with Charlie Rose, Tom Friedman commented on his article "China for a Day" where he suggests if Obama had the ability to make unilateral decision for just one day, and then we went back to the traditional governance process we could likely take the country in a new direction a lot quicker.

So, where does this lead me? I am from Ireland and back during the times of the IRA terrorism we had a saying "If you are not confused, you don't understand." Or as Tom Peters likes to say - "I am more confused than ever, but at a higher level and about more important things".

Inherently, I viscerally believe that the Truth does set you free, but this is based on my own observations around my social interactions with other. Business is not just about social interaction it is also about commercial interests. These two systems share some attributes but vary widely in others. You can cut some corners in business that you can't in life. Staying true to your ethical principles in the Social realm has lost many people their jobs, or worse compromising them has landed many people in jail.

If you are leaving this post with more questions than when you arrived then, according to my definition at least, your knowledge base has expanded. The paradox of knowledge acquisition is that the more we know about a given topic the more we are exposed to how much we don't know.

For now my take on Social Production fueled by an Architecture of Participation model has a valid and valuable place in the overall landscape of how we efficiently coalesce capability round endeavor. It cannot totally replace the Market models of decentralized price or centralized enterprise nor can it replace centralized non-market systems such as non-profit or government, but it CAN make each of them better and that is what this website is all about.

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RV | February 1, 2010
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They have just launch an <a href="http://www.worldsalvation.info/2010/01/saving-lives-from-malaria/">"Open lab" for malaria research</a>.

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Jonathan Opp | January 28, 2010
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Tony makes an interesting point here about technology and openness--the boundaries of what we're sharing and how often have certainly changed, as anyone who spends time on Facebook knows very well. Individuals now have the means to broadcast information in ways we couldn't have imagined a generation ago. With the more recent rise of mobile computing, we're always connected, always sharing, everywhere, all the time. The technology has created a truly disruptive environment.

So not only has technology helped move the boundaries of what we're sharing, it has also given more people a means to spread information and encourage transparency.

Which raises a question, the trend toward openness and transparency--is technology making it inevitable?

Thoughts? Keep them coming!

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ChrisMorse | January 28, 2010
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I believe organizations benefit from openness and transparency because (as Colin Dodd highlights above) they build trust. I can understand that openness and transparency can be a scary concept for some. And it can be seemingly impossible for others ("Corporate is talking about layoffs"). However, a commitment to transparency and trust can yield some powerful benefits, too. Benefits like the trust that can manifest in employees through a deeper understanding of a company's direction and leadership. Or the trust that can build within customers with respect to a company's reputation and an affirming of a fulfilled brand promise-- or the admission of an unfulfilled brand promise. ("Sorry -we messed up. Can we take a look at those pedals again?" - Toyota)

We were recently watching a leadership seminar in our group (the People & Brand team at Red Hat) where Keith Ferazzi expressed how courageous and powerful it is to be transparent and open with someone about what's going on in your life (from seminar entitled "Who's got your back"). Stripping away pretense and reducing any masking done to preserve pride (both in times of error and success) can be such a humanizing and relationship-building exercise. At least that's what I've seen. When done right, we've all heard some statements like these that have yielded increased trust and respect. "Sorry I'm not really a 100% this week, but I got some bad news from the doctor" or "I couldn't have done it without the help of a lot of people who collaborated on this project" are both statements that are rare but humanizing and yield my respect due to honesty. And it makes that person seem human. No one is perfect. And I'd much rather be lead by a human than a "perfect" superhero of a person who could just be lying to me.

I'm not saying that all of this is easy, though. If it was, then everyone would be doing it. Imagine that.

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Stuart Gathman | January 28, 2010
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I attempted to sign up for the forum, and got a forged MAIL FROM response (presumably the confirmation - I confirmed this by requesting a new password, which triggers an attempt from the same server):
2010Jan28 21:25:32 [8831] connect from 67-23-31-6.slicehost.net at ('67.23.31.6', 36331) EXTERNAL DYN
2010Jan28 21:25:33 [8831] hello from acquiamail.acquia.com
2010Jan28 21:25:33 [8831] mail from <osdc-admin@redhat.com> ('SIZE=2526',)
2010Jan28 21:25:33 [8831] REJECT: SPF fail 550 SPF fail: see http://openspf.org/why.html?sender=osdc-admin@redhat.com&ip=67.23.31.6

It is important for this not to happen, because lots of shady guys forge the redhat.com domain a lot, for example:

2010Jan28 18:28:43 [7507] connect from [121.183.252.190] at ('121.183.252.190', 2059) EXTERNAL DYN
2010Jan28 18:28:44 [7507] hello from GBNPWMKYMV
... attemps to forge other domains...
2010Jan28 18:28:45 [7507] mail from <gibsonrca1@redhat.com> ()
2010Jan28 18:28:45 [7507] BANNED IP: 121.183.252.190
2010Jan28 18:28:45 [7507] REJECT: SPF fail 550 SPF fail: see http://openspf.org/why.html?sender=gibsonrca1@redhat.com&ip=121.183.252.190

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Jason Hibbets | January 29, 2010
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We are working on correcting this issue, please use our contact form in the future https://opensource.com/contact so that we can keep the comments relevant to the article.

Jason

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Honey Mak | January 28, 2010
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all the guys are saying "the source" should be some what protected. yes, if we think of only "small" scale.
BUT it is a "no" if we could think large.

we are not all-round but when we gather, we are all-round.
we should not just focus on initial TCO.
actually, we should think about large community based "issue".

we don't have problems or we all have the same problem.
just not kind of "communism"

there's difference between community based model and communism.

so we should find some ways to leverage all our costs AND profits.
if we still think of what you pay = what you gain, it's still super-old-traditional primitive model of thinking

maybe in other "techie" terms, humans are load balancing any each other one. so we contribute AND we believe many others are contributing at the very same moment and attitude BUT in other areas.

that's what "the world" should be and encompassing.
anyway, i know i am drawing a super-extra-large size of picture though. XD

anyway, just my 2%. could be meaningful while meaningless as well.

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Jeremy Leonard | January 30, 2010
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I've noticed that companies that have an open and transparent culture tend to have better long term success rates.

I think there are a couple main reasons for this. The first is that, whether the company is dealing with difficulties or not, employees of a company with an open/transparent culture would be more likely to be engaged and empowered to solve problems and make improvements to how things are done.

Secondly when dealing with vendors, customers, etc..., an open and transparent business is more likely to instill trust then a non-open / non-transparent business. Even in situations where a business has to walk away from a business transaction, the open and transparent business is more likely to give clear and concise reasons for not going further with a transaction; which instills a higher level of trust, then just backing out.

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Shaun Ryan | January 31, 2010
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I think Jeremy's point is spot-on. Besides building engagement with the customers and workforce, the more transparent or open companies have a potentially giant competitive advantage. They make it easier to identify and fix mistakes, which over time is a huge thing for them, their employees, and the customers/partners outside the organization.

As an example, I'd offer Toyota's handling of their gas pedal problem. Sure, it's a short-term PITA, but they're also sending an important signal, "hey, we want you to trust us" to their customers. (I also like that about the security and bug-fix cycle in OSS as well.) I'm sure some troll somewhere is working on a lawsuit against them, but in the long-term I suspect they're buying tremendous good will.

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RV | February 1, 2010
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As i mentioned above, a major pharmaceutical company has just open an <a href="http://www.worldsalvation.info/2010/01/saving-lives-from-malaria/">Open lab for malaria research</a>

Increasingly, the "open source" model is spreading through the economy (open source genome, open source databases, open source content, open source researches).

It increases collaboration and in the long run leads to the creation of more riches for more people.

Now there is a question there: is open-source and transparency the same. My answer is no.
Besides, transparency is a lesser concept than honesty and generosity. Those two are at the base of the Open-source community.

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