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Recently, I wrote a business plan. Like most business plans you’ve seen, it described strategies, tactics, and goals. But nothing about the plan was particularly secret. So, my partners and I distributed the entire document, financial projections and all, to dozens of people. No one had to sign a nondisclosure agreement. There were no numbered copies. Everyone who received the plan was perfectly free to pass it along to others. Almost immediately, feedback began pouring in. Some people identified questionable assumptions. Others called our attention to vital facts we’d overlooked. A few people even noted typos that had slipped past the spell checker. In effect, our far-flung readers, including a few complete strangers, had "debugged" the document. Unwittingly, we had followed the model of the "open-source" software movement. Many companies, including a few of the world’s smartest and biggest, are doing the same thing. Many more should. Open-source software development, which taps the communal intelligence of volunteer programmers, should become a model and metaphor for strategy making and product development at all levels. You’ve undoubtedly heard of the open-source movement. The best-known example is the Linux operating system. By placing their "source code" in the public domain, the creators of Linux gave any programmer the opportunity to seek ways of improving the operating system. As the best results spread through the global programming community, Linux becomes faster and more robust. Lucent Technologies did something similar when it built a new plant in Mount Olive, N.J., for making cellular transmitting equipment. Workers at all levels were asked to help design the plant. Rank-and-file assemblers were even asked to help design the product itself; who, after all, knew more about designing a product that could be manufactured easily? The result was one of the world’s most efficient and reliable telecommunications assembly plants. At Great Harvest Baking, the national chain of whole-wheat bread stores, every innovation created by a store owner becomes public property within the franchise network. As company founder Pete Wakeman explains, "People scatter off in all directions on a search. As the best answers are found, they gain converts, who teach new converts, and soon a chaotic mess gets aligned in a stampede toward a single point." Bear in mind that these innovations improve and spread only because the people within the company’s network are free to know and share them. Some companies embrace the open-source model to the point of releasing even proprietary ideas or concepts into the public domain. McMaster & White LLC, a management-consulting firm in La Selva Beach, Calif., created a long and richly detailed set of design principles for managing change in corporations. The firm placed the entire document on the Web at www.ientrepreneur.org and invited comments. These methods create robust products and strategies for the simple reason that nobody is as smart as everybody. "You’re not smarter than the sum of everyone else in the organization," says David Weinberger, a business consultant who publishes a popular Web-zine called the Journal of the Hyperlinked Organization (www.hyperorg.com). If you’re a senior executive, "everyone else is closer to the customer. And unless you’ve beaten the passion out of them, the people who work for you want to improve what you’re doing." Richard Gabriel of Sun Microsystems, who is helping to build a community of developers around Sun’s open-source Jini software, says: "When you take people from different parts of the organization, or even from different organizations, the diversity of knowledge they have usually brings pretty dramatic results." Gabriel applies the open-source approach to problem-solving of all kinds. Though new as a commercial model of software development, the principles of open source have been around for years. Peer review, probably the most powerful arbiter of scientific truth ever invented, exists because most science is conducted in the public domain and because any community knows more than even its smartest member. Many of computing’s most important innovations, from the Unix operating system to the Internet itself, grew robustly because they were based on transparent technologies any programmer was free to improve. Beta testing—giving away a product so customers will help you debug it—is now standard operating procedure in software development. In the feedback loop between vendor and customer, there’s really no such thing as a final version anymore. Obviously, it makes no sense to develop truly confidential products or strategies in public. You wouldn’t want to open the "source code" for a Normandy invasion, a pharmaceutical molecule, or a novel e-commerce business model. But in the trade-off between a robust strategy and a secret one, robust is often better. And in a networked world, stealth is becoming not only less valuable but less practical as well. Even the U.S. Marine Corps is training commanders to rely more heavily on troops to formulate battle strategy. How can leaders begin applying open-source principles in their own organizations? A few ideas come to light.
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Presume in favor of openness. In formulating strategy or developing products,
make confidentiality the policy by exception. The greater the range and number
of people who know about work-in-progress, the greater the intelligence those
works will ultimately harbor. Defects, says open-source evangelist Eric Raymond,
disappear quickly "when exposed to a thousand eager co-developers pounding
on every single new release."