Open organizations are a departure from Fordism

Goodbye Henry Ford, hello open organization

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The decision to pursue an MBA is a major one, and people make it for many reasons: the opportunity to refocus your career (even change it completely), the chance to prove yourself as a future business leader, a guaranteed way to quickly grow your professional network, and, most of all, the educational opportunity to learn new skills from business leaders and professors.

For me, it was a bit of all these. Prior to school, I'd worked in marketing for the retail e-commerce industry. I was happy with the way my career was developing. I felt I was working hard and learning a lot, taking on multiple roles before eventually becoming a marketing manager at a globally recognized brand.

Despite this, I was restless. The source of the feeling was difficult to describe. I'd always had great managers and made friends of my co-workers, but something about the traditional organizational structure itself troubled me. Rigid and slow to adapt. Silos and lack of communication. Continuing to do things in a way that everyone knew could be improved, simply because "that's the way it's always been done." It wasn't anything specific or unique to the organizations in which I worked; it's the same old story everywhere.

My frustrations fueled my decision to leave the workplace for two years and pursue my MBA. I hoped my education would expose me to companies actively working to avoid these common issues. I wanted to learn more about leadership, organizational behavior, and methods for fostering innovation and creativity. In essence, I was craving a new organizational experience.

A summer in an open organization

My quest for change ultimately led me to Red Hat for a summer internship with brand marketing. As a tech enthusiast, I was familiar with Red Hat and had learned a bit about their approach to being an open source company. I wanted to experience what being part of an open corporate culture really meant, a goal I shared with my manager during our first meeting.

Early in my internship, I attended a signing of The Open Organization, where Red Hat CEO Jim Whitehurst spoke about the motivation and key principles his book contained. At one point, he gave a brief history lesson about management theory and the rise of large corporations. This message resonated deeply with me (an MBA seeking relief from traditional organizational problems). It helped me identify some of my past frustrations with organizations and corporate culture. The following, largely paraphrased from Jim's lecture and book, describes why we need new management philosophies.

Toward a new model (not another Model T)

If you think back to the days of Henry Ford and the Model T, management philosophy revolved around extracting the highest level of productivity from a large group of mostly uneducated laborers. Profits were driven by management's ability to incentivize workers into performing rote, assembly-line-style tasks as quickly and efficiently as possible. In a span on 19 years, this method helped produce more than 15 million Model Ts. That means (theoretically) that an individual could have performed the same task at the same assembly line for 40 hours every week—for two decades. Clock in, clock out, get paid, go home. The assembly line approach drove a booming economy, and the middle class was happy and growing. Plants were efficient, profits were high, life was good.

One-hundred years later, life and business are very different. The laborer performing a rote task has been replaced by a machine. Technology has transformed the way we communicate, and disruptive technologies and innovative startups make entire industries irrelevant on a regular basis. To survive in today's world, companies need smart, creative employees capable of approaching problems differently. Employees must have not only have skills, but also an ability to prove value in new, dynamic situations. Performing the same task for 19 years is no longer an option in most industries, and employees must be adaptable.

However, we're still rooted in the management philosophies of Ford's era. We still "clock in" from 9 a.m. to 5 p.m., and managers hire employees with specific skill sets to perform specific tasks within their department. We silo departments, and we build our personal territories around tasks that fall into our job descriptions. While technology allows for a more flexible definition of "workplace," we can still feel as though we've just replaced the assembly line with cubicles. Given the accelerating pace of change in today's economy, we need a management philosophy designed to attract and encourage employees capable of adapting and thriving when faced with new tools, technologies, and market situations.

Admittedly, traditional top-down management still has something to offer. We must still make decisions, which can be difficult in large organizations. However, after spending the summer in an open organization, I've seen management intentionally try to approach business decisions differently. Here are a few personal observations about how Red Hat distinguishes itself from traditional organizations.

Open communication

While most companies strive for fluid internal communication, openness is foundational to Red Hat. With the exception of salary information, employees are not only allowed but also encouraged to share their thoughts and feelings. And they do—a lot. They do this through opt-in email lists that cover a variety of topics, in addition to a general list, called "memo-list," to which I was opted-in by default. So imagine, with a few clicks of the mouse, sharing the latest industry article, feelings about a corporate policy change, or just general thoughts with more than 7,000 coworkers who then offer opinions, debate them, defend them, and debate them further. While this may sound tedious or confrontational to some, it's everyday life at Red Hat.

Hierarchy and decision-makers still exist, but my team felt much less structured than teams I'd join at previous organizations. Red Hat uses this type of communication to harness the "wisdom of the crowd" approach in everything it does. Executive Vice President and Chief People Officer Delisa Alexander describes the pros and cons in a 2011 article.

Hiring

At Red Hat, "fit" and passion drive the hiring process. As Red Hat hopes to maintain a unique and open culture, they are aiming to hire associates who can work well within this particular type of environment. Therefore, job descriptions (at least on my team) were intentionally vague, and rely less on recruiting for specific skill sets. In fact, many people on my team share the same job description on paper, but do dramatically different day-to-day work. To quote my team's director: "We just want to find smart, passionate people who fit in well here, and we'll tailor a job around their strengths." Employees still need to have the skills required to do their jobs (say, marketing or writing code). However, positions are more open to interpretation, with room to mold them a candidate's personality.

While "hard skills" are important, so is being passionate about the company mission. Employee passion around open source principles and technologies is extremely obvious at Red Hat. Jim discusses this in detail in The Open Organization, as well as in a recent article.

Project flexibility

Unlike some MBA internships, mine was largely unstructured. While my manager wanted to see me complete a few specific projects, I was generally free to work on anything else I thought was worthwhile. For me, this freedom and lack of formal corporate structure was a great way to learn. Curiosity about Red Hat products and projects connected me with people from across the organization, and ultimately developed into multiple project proposals. Based on conversations with other interns, I can say this informal way of operating seemed consistent on other marketing teams as well. Basically, if you have a good idea and share it, and others agree that it has merit, you can spend time making it a reality. My manager encouraged me to develop my ideas rather than handing down other work to be done. This approach is critical to open source methods, which rely on a community's collective efforts to make improvements. If you see something that could be better, go make it better.

Joining the open movement

I came to Red Hat looking to experience life at a company that is intentionally different in it's operational methods. Red Hat's focus on transparency and community-driven decision making certainly exceeded my expectations.

While I had an amazing experience at Red Hat, I'm not advocating that the experience is for everyone. When you encourage open communication on all fronts, discussion and decision can take longer than they would if they came from the top. Feedback is honest—sometimes brutally so. However, I enjoyed working in an environment where people constantly challenge assumptions and everyone is free to chime in. As a whole, the intentionally open culture at Red Hat was a welcome experience for me, and a great introduction to nontraditional organizational structures.

Thinking about all the current and future employees who join Red Hat directly out of school is exciting. By starting their careers at Red Hat, they will hopefully avoid some of the corporate frustrations I experienced throughout my 20s. They will understand the power of intentional corporate culture, transparency, and open communication. Their careers will be rooted in a non-traditional understanding of corporate organization. As they become the future leaders at Red Hat and elsewhere they will bring this perspective with them. The Henry Ford era of management philosophy may finally begin to change.

Follow the conversation on Twitter #theopenorg

Intern
Stories

This article is part of the series of Red Hat Intern Stories. These interns share their experiences about what it’s been like to work for an open organization, and more.

About the author

Nate Woodward - MBA at UNC Kenan-Flagler and summer intern with the Red Hat brand team. Inspired by tech, music, nature, sci-fi, literature and big ideas.