The Open Organization: Igniting Passion and Performance

At first, this might sound similar to crowdsourcing. But it's not. Crowdsourcing, as great as it is, has its limits. It's often used to achieve a specific goal. For the most part, it depends on unpaid volunteers. It's not sustainable, and you can't use crowdsourcing to run an airport or distribute a product.

The open organization concept engages people because they work together long-term, and build on one another's work. They're able to solve complex problems because of this building effect.

In this model, employees are treated more like volunteers. You have to work hard to keep their passion and engagement high. You have to trust them to manage themselves and make good decisions, and you need to believe they'll do the right thing. In terms of management style, it's very hands-off.

The concept might sound a bit radical at first. But companies like Whole Foods, Pixar, Starbucks, and Zappos are already using these ideas with great success.

In "The Open Organization," Whitehurst shows us how to overhaul the traditional "top down" style of management, and create an organization built on transparency, participation, and collaboration.

Jim Whitehurst is the president and CEO of Red Hat, the largest open source software company in the world. Before joining Red Hat, he was the chief operating officer at Delta Airlines.

So, keep listening to find out why showing more emotion can help you ignite passion in your team, some simple tips on increasing engagement, and how being more inclusive in your decision-making can lead to better decisions.

"The Open Organization" is divided into three parts. Part one looks at why you need to open up your organization to ignite passion and build engagement. Part two looks at how to do this. In part three, you'll learn how to set the direction of your organization and move forward.

You may be wondering what an open organization looks like in real life. Whitehurst kicks off the book with a quick story from when he first started at Red Hat.

In his previous career, Whitehurst managed Delta Airlines. He was a data-driven leader, and when he started at Red Hat he expected to use a similar leadership approach.

One day, he issued what he thought was an order to his team to create a research report. Several days later, he asked them how it was going. The team said they'd decided it was a bad idea, and they'd scrapped it.

At first, he was shocked. But after he thought about it, he realized that the team was right to reject the project. Either it wasn't a good idea, or he didn't do a good enough job of selling the team on why they needed to do it.

This, at heart, is what an open organization is about. The people working in this type of culture have power and autonomy to influence the work that gets done, even if it means disputing an order from the CEO. Feedback and debate is constant. And, leaders have to trust their people to make the right decision.

In an open organization, the "why" of work is the most important element. This drives every decision, and it's the basis for people's passion and engagement.

Creating a culture like this isn't easy. But the end result can be magical. And judging by Red Hat's incredible success, it can transform what your organization is capable of.

It sounds great. So how do you actually do it?

The first step is covered in chapter two. You have to start by igniting passion. But you can't do this unless you first understand the true purpose of your organization. How is your company making the world a better place? Or, how do you want to make it a better place?

Create a compelling reason for your people to participate. And it can help to consider this perspective: your people's time is valuable. They choose to spend it with your organization. And they want to feel like they're making the world a better place in the process.

To ignite passion, you also need to rethink the role of emotion. At many organizations, showing emotion is considered unprofessional. Leaders expect their people to check their emotions at the door when they come to work. But Whitehurst argues that you need to intentionally spark your team's emotions.

One way to do this is to show emotion yourself. Let people see your passion and excitement. Let them know when you're frustrated or unsure. Make things personal, and be willing to let your guard down.

You also need to hire passionate people. Whitehurst includes a great quote from Simon Sinek, the author of "Start With Why," which reinforces this. Sinek says, "Great companies don't hire skilled people and motivate them, they hire already motivated people and inspire them."

To find passionate people, think about overhauling your interview process. Traditional interview questions don't do a great job of finding truly passionate people. Instead, ask interviewees to talk about their passions.

Another way to find passionate people is to rely on your current team. At Red Hat, they created the Red Hat Ambassadors program, where employees are rewarded for referring successful job candidates to the company. The more successful candidates they refer, the larger their rewards. The tagline for the program goes: "No one can spot a potential Red Hatter better than a current Red Hatter."

We like this idea because so many organizations could implement a similar program. Your people know your own culture best. Are you doing anything to encourage them to find potential recruits? Are you rewarding them for it? If not, maybe you should start.

Whitehurst has several more good ideas in this chapter to help you ignite more passion in your organization.

Once you have passion in your team, you have to build engagement. The two go hand in hand. And, they're not the same thing. Passion is about meaning and excitement. Engagement is about channeling that positive energy into one's work.

One Gallup study showed that only 13 percent of the employees surveyed were actively engaged at work, and more than twice that number were so disengaged that they spread their negativity to others.

These are depressing numbers – and it is just one study – but there's a lot you can do to make sure your team falls outside these statistics.

One strategy is to use the OODA loop with your people. OODA stands for observe, orient, decide, and act. Whitehurst says that we're constantly processing information that we observe, before choosing to act on what we see. So the faster you can close the loop between your observations and taking the right action, the more effective your actions will be.

In an open organization, employees are encouraged to make observations and act on what they see, instead of waiting for orders. And a key part of this is to make sure employees really know and understand the company's strategy, so they act appropriately. This will help them avoid making mistakes when they take action.

You also need to rethink your organizational structure. At first, many people think that an open organization is a democracy, where everyone has a say. Whitehurst says this isn't the case. At Red Hat, they've organized themselves into a meritocracy, where it's the merit of a person or an idea that counts. This means that often, the people closest to the issue make the decisions about that issue, not the people who are responsible for the overall organization or the team.

While everyone has the right to speak and have their voice heard, Whitehurst says that not everyone is listened to equally. There are still leaders and thought influencers, and your company can leverage these people to drive innovation.

W.L. Gore, the maker of Gore-Tex, has done this successfully. Here, there are very few bosses or traditional job titles. Leaders are chosen by their peers based on how effective they are. Their resumes and past history are irrelevant once they join the team. It takes an average of 18 months for new hires to build credibility and trust, and to attract enough followers to be given responsibilities.

Another key part of an open organization is the freedom of debate. Whitehurst says that at Red Hat, the feedback from sharing ideas can feel blunt and brutally honest. The sparks really fly when people feel that a person or project is going against the company's core values.

But this level of debate is what drives constant innovation and improvement. It's also another reason why people are so engaged.

Whitehurst says that the lack of frank dialog is the single biggest controllable weakness that most companies impose upon themselves. Fortunately, it's something you can quickly change.

You can encourage more debate in your team or organization simply by inviting it. If your people aren't used to debate, start with easy topics.

Next, pay attention to the barriers that can prevent an open dialog. For example, don't start a contentious conversation in someone's office. That's their "home turf." Pick a more neutral place.

You also need to create forums for healthy debate. Where can your people go to voice their opinions and have conversations with the leadership team?

Feedback is also really important. Invite people to give you feedback, and thank them when they do. Be gracious about what they say. If you act defensively when you get feedback, chances are high you won't get it again.

When it comes time to make decisions in an open organization, you have to be inclusive. There are real benefits to doing this, and also some real challenges.

In most organizations, decisions come from the top down. Making a top-down decision is fast and relatively easy, which is why a lot of companies like this style of decision making. But once that decision is made, you have to execute the plan and make the changes that go with that decision. You have to convince people to go along with you. And, this is not easy.

In an open organization, decision making is more inclusive. The more people you involve in the decision-making process, the more buy-in you have. People are just more committed to decisions they've had a say in. Even when the decision doesn't go their way, they're more committed, because they feel respected and heard.

To be more inclusive in your own decision-making process, go out and talk to the people you work with. When you do, be open, honest and frank. Talk to them about an upcoming decision that will affect them. Explain the situation, and ask what they think.

You can also use technology to reach out to people. The president of PrimeLending regularly sends emails to all the employees asking for ideas about how to run the company better, or make it a better place to work. They've had some great ideas come through email that they implemented successfully.

If you're hesitant about being more inclusive in your decision making, do a comparison. Look at decisions that were made top-down, and compare them to decisions that were made openly and with others' input. Which decisions were more successful?

We really like this chapter on inclusiveness because it's such an easy and quick way for any manager to boost engagement and autonomy in a team. Your people may have lots of opinions and ideas that could make a project, or your entire organization, better. All you have to do is ask.

So, what's our last word on "The Open Organization?"

You don't have to read far into this book to feel the passion and excitement that Whitehurst has for this organizational model. He truly believes that the open organization is the way of the future, and he does a great job of convincing the rest of us that he's right.

The book is engaging and practical, and there are plenty of tips and strategies to help you implement these ideas in your organization. At the end of each chapter, there are five leadership tips that will also help you take action.

"The Open Organization," by Jim Whitehurst, is published by Harvard Business Review Press.

That's the end of this episode of Book Insights. Thanks for listening.