THE OPEN ORGANIZATION

Strong believers in the myth of leadership refuse to distribute power and decision-making authority to others not of the same rank in the organization. For them, wisdom resides primarily at the top. In the open organization, on the other hand, a key belief is that wisdom is distributed among all the people in the company. This path requires a lot of courage, but it produces more avenues for creativity and innovation. Whereas the rank-based leader attempts to predict and control people and business conditions, peers in an open organization seek to cooperate, communicate, and evolve with people and business conditions by expanding internal networks of councils and task forces.

We have already examined in detail the assumptions, logic, and practices of peer-based thinking and how to build a peer-based organization. So we know what to expect in the open organization ”the first form of a peer-based organization. Here you have management without hierarchy or rank, as peer councils are not subordinate to management, but rather mentored and coached by the senior executives. You also have hierarchy, but not one that subordinates the many to the few ”it is a hierarchy of processes, projects, and assignments. In an open organization, councils are the multiple centers for decision making ”the nodes of the organizational network. Executives and managers fill the role of cross-fertilizing ideas and best practices between eouncils, not as agents of top-down, command-and-control management, but as internal consultants ”the connectors of the nodes in the organizational network.

When creating an open organization in a turbulent business environment, influence is superior to control. Control is about coercion ”even coming from benevolent tyrants, it only brings compliance and dependence from employees . Power as influence, on the other hand, can bring commitment and interdependence . To exercise influence, the flow of information in the organization must be opened up through the creation of information-rich networks. This, of course, means allowing more open and honest communication about both business conditions and financial issues, greater equity of salaries and more aggressive rewards for innovation, and cross-fertilization of ideas and best practices in knowledge sharing. The simplest way to say it is that all members of the organization enjoy equal standing. Let's look again at some organizations from previous chapters that approximate open organizations.

W. L. Gore & Associates and Open Decision Making

An organization that has developed a similar philosophy and structure to the open organization is W. L. Gore & Associates, the company discussed in earlier chapters. Anyone interested in great companies should get to know this organization. Gore has approximately seven thousand employees, all called associates, in forty-five locations around the world. With revenues that top $1.4 billion, Gore is a very successful company.

Gore has dispensed with hierarchy; there are no "bosses" there. Instead, the company has developed a lattice structure that allows anyone to talk to anyone else in the organization without needing to go through any formal bureaucratic processes. The management philosophy closely resembles what I am presenting here. They have discovered the secret of both open information flow and managing through councils, and their continued profitability is evidence of the effectiveness of this approach. As Laird Harrison (2002) reported in Time magazine,

Each worker at Gore enjoys broad discretion to make minor decisions. Bigger ones ”hiring and firing, setting compensation ”are made by committees whose members constantly shift with the demands of business. Anyone can start a new project simply by persuading enough people to go along with the idea. Even Bob Gore, 64, chairman and son of the founders, has his compensation set by a committee.

A prerequisite for being hired at Gore is to have an internal sponsor. This person then becomes the employee's mentor. Gore's management structure has no chain of command, but " leaders " chosen by peers, and any associate can take any idea or complaint to any other associate. Such a free-form structure is a great embodiment of peer-based thinking in an open organization.

Motek and Open Information

The absence of hierarchy at Motek allows decisions to be made closest to where the work is being done. Obviously this works most effectively when information is openly shared throughout the organization. Not surprisingly, in peer-based organizations sharing decision-making power and opening up the flow of information go hand in hand, and is a hallmark of an open organization like Motek. As mentioned in Fortune Small Business by one observer of Motek, Ellyn Spragins (2002), "Smart employees manage themselves perfectly well if they have complete information."

Orpheus Chamber Orchestra and Open Design

Orpheus realized early on that eliminating the command-and-control structure within which most businesses operate is risky. Getting rid of the orchestra's conductor could invite chaos! Most people have a difficult time imagining how to work without a leader because, for most of our human history, we have been organized in rank-based societies . To make the transition to peer-based organizations, peer-based thinking must be designed in. Orpheus realized this would require clear and unambiguous roles and responsibilities.

As presented in Leadership Ensemble , Orpheus designed organizational roles in a manner that would invite maximum participation in decision making. For each performance, Orpheus chooses a designated leader, not as a rank-based command-and-control figure, but as a facilitator to guide them through rehearsals and performances , following the Latin phrase primes inter pares ("first among equals"). This is not a permanent leadership position, but rather one that is changed at regular intervals to give others the opportunity to assume greater decision-making responsibilities.

Orpheus also chooses five to ten musicians to serve as the " core team," similar to a peer council, for each performance. Their role is to develop musical interpretations and ideas to improve each musical production. Other "committees" are also chartered at different times to make important decisions facing the orchestra. In each case, the design is intended to reduce rank-based thinking and foster peer collaboration. At Orpheus, each associate's priority is to use his or her talents to contribute to making the best possible musical product ”leading is just another skill set associates develop, not a primary position they hold.

This peer-based design ensures that the primary focus of the organization is serving the customer and that each employee develops decision-making abilities that center on customer and other stakeholder needs. At Orpheus, the way organizational roles and responsibilities are designed to distribute power and authority to all members of the orchestra generates tremendous resiliency and innovation, not to mention spectacular musical performances.

From Open to Leaderless Organization

Through expanding decision-making freedom via peer councils, each person in an open organization finds opportunities to exercise "leadership." As this peer culture develops, employees are empowered to act without necessarily needing approval from higher-ups; in fact, the very term higher-ups doesn't make sense in the open organization, for there is no higher. It's a form of organizational decentralization in which no one entity or agent within the organization has complete command and control ”power will naturally flow where it is most needed at the time.

It seems that the time will come in an open organization when even the advisory role of senior executive leaders will be a hindrance to successful decision making. Within fifty years we might be moving to the strange attractor of the leaderless organization. The exciting thing is that "leaders" do not need to control it. In fact, in many ways leaders are irrelevant to the inevitable development. Aristotle defined organisms as having within themselves their own possibility for development. Organisms do not require outside forces in order to grow and evolve. Organizations have within themselves this same power. They contain everything they need to open up the possibilities for development. They will grow into these possibilities without leaders or outside consultants. The strange attractor of the leaderless organization is the most exhilarating of these possibilities.