The Open Source Business? 297
Ted wonders: "Being an advocate of the open source software movement for some time, I'm wondering how and if the principles of open source software could be applied to a new type of open source business. In a world where people slave away for the sole profit of a board of directors and merciless shareholders, is there room for a new type of organization that throws away the archaic and monolithic organizational structure of today and from there form a company that has its direction dictated by all of the members that run it. An organization where everyone has an equal say in what goes on. There isn't any limit on how many people can be involved (the more the better, in fact) as long as they can be useful. Could this be the way of the future?"
hm. (Score:2, Insightful)
Re:hm. (Score:2, Insightful)
Re:hm. (Score:2)
Remember everyone, when everyone takes an equal part in something, it can be Democracy just as much as it can be communism.
In fact, communism (in theory) makes everyone equal, wheras democracy gives everyone an equal say.
This seems much more like democratic business, to me. The communism equivalent would probably be something like paying people less and less depending on how wealthy they are...
Re:hm. (Score:2)
An enormous fraction of our citizens live in poverty or near-poverty, despite being good workers.
Can you back that up?
Re:hm. (Score:2)
Maybe, but by choice.
It's a great example of Peter's Principle, really: workers themselves would promote the incompetent so that they wouldn't interfere with the real work.
Of course, the system has a few... glitches, which in turn ruin such systems.
Re:hm. (Score:3, Insightful)
Re:hm. (Score:2)
A.K.A.: Employee Buyout of a Corporation (Score:5, Insightful)
Such an organization already exists. It is an employee-owned company [wikipedia.org], which often becomes employee-owned through an employee buyout. There are numerous examples of employee-owned companies [wikipedia.org].
The most famous example is United Airlines [businessweek.com]. It operated as an employee-owned corporation from 1994 until 2002 [wikipedia.org].
The lesson here is that sometimes employee-owned companies succeed. Sometimes, they fail. There is nothing magical about being open source or about being a company structured on the open-source process. Such software and such companies are subject to the whims of the marketplace and can succeed or fail -- as determined by the invisible hand of the free market.
Re:hm. (Score:2)
Re:hm. (Score:2, Interesting)
Good luck with that (Score:4, Insightful)
Disagree (Score:2)
Re:Good luck with that (Score:2, Informative)
is that why the the amount i pay to have a kWh delivered to my house is almost as much as the amount i pay for the actual power? those 150 kV poles didn't grow by themselves you know
Leadership by committee? Doubtful. (Score:5, Insightful)
Re:Leadership by committee? Doubtful. (Score:2)
Of course, the big downsides of democracy (uniformed voters, mostly) obviously wouldn't exist in a company, where (presumably) every employee is intelligent, educated about the company, and has a personal and very material stak
Re:Leadership by committee? Doubtful. (Score:2)
Re:Leadership by committee? Doubtful. (Score:5, Insightful)
Anyone remember the story of the kids who found a cat and when asked the sex, immediately voted that he was male and his name was Johnny? Two weeks later "Johnny" had kittens.
Unfortunately, too many people think they have a equal and valid opinion on any subject. Even when there are in fact educated in a given field, they think that makes them an "expert" in other, non-related fields. Do I really want, for example, a technology company in which the janitors have an equal vote with the engineers? No disrespect, but in all likelyhood if the janitors were intelligent and educated... they wouldn't be janitors.
Look at all of the companies where the workers voted themselves higher and higher wages and more benefits... and then went bankrupt or out of business because they were no longer competitive. Heck, most people can't even run a lemonade stand successfully, much less a large organization.
Now, I do think companies, CEOs, and boards need a higher level of accountability. But IMHO, counting runny noses is probably one of the worst ways possible to run a company. Heck, more than six people can't even decide where to have lunch.
Re:Leadership by committee? Doubtful. (Score:3, Insightful)
Also, I take issue with your "runny noses" barb. Frankly, this smacks of the same sort of paternalism that neo-cons are constantly accusing liberal
Re:Leadership by committee? Doubtful. (Score:3, Informative)
I sure do--that would be guys [wikipedia.org] like [wikipedia.org] these [wikipedia.org], right?
Offhand, though, I can't think of a single case where a worker-run company [blogspot.com] has suffered anything comparable. Certainly not in the last few decades.
Corporate governance is about monkey psychology, which in practical terms means the tendency for arrogant idiots to rise to t
Re:Leadership by committee? Doubtful. (Score:2)
Who gets paid anyway? (Score:2)
Re:Leadership by committee? Doubtful. (Score:4, Insightful)
Yeah, I mean America would never work if everyone had a vote for the legislature and for the national president.
Only the rich people, who own a share of the country, can really run the country. And the richest should get even more votes than the others.
(end sarcasm)
Um
Why not just change the corporate law: instead of stockholders voting for the board of directors, let the workforce vote for the board of directors, one person one vote?
At the moment, democratic governments are faced with a plethora of non-democratic institutions (business corporations) with enormous powers. The corporations are governed the same way that America (and England, etc) were governed long ago: those with property had a vote (and those with the most property, the aristocrats, were represented in person in the English Parliament); those without property had no vote. This system is called plutocracy - rule by the wealthy. We got rid of it in politics
Business requires money and human effort. How come those who contribute the money control the business; and those who contribute the effort get no say? Does that sound fair or democratic? Isn't it putting money above people? Isn't it contrary to the whole basis of a democratic society?
Re:Leadership by committee? Doubtful. (Score:4, Insightful)
People who put money into a business are investors that know there's a risk they won't see that money again. They are rewarded for that risk with a share of the company that goes up in value when the company does well. The bigger the risk they take, the more that share should be valued if the company actually succeeds.
Employees, on the other hand, take absolutely no risk. If you work, you get paid. If you go working for a startup, they often give you options to reward you for taking the risk that you'll be out of a job in a year and may not have a huge starting salary.
Gordon Gekko said it best, greed is good (up to a point). If you're upset by all those CEO's and business owners that are making all the money, then start your own business or become a CEO (unless you have connections, you're better off trying the former). If you choose to stay an employee, then you get exactly what the company offered in exchange for your services and nothing more.
In soviet russia... (Score:2)
Cooperative (Score:5, Insightful)
Re:Cooperative (Score:5, Insightful)
-Credit unions
-Insurance compaines
-Religous communes
-Rural coops, including telephone, electric, water and sewer coops.
-Mutual benefit corps. such as fraternal organizations.
What is blowing the minds of many of the posters is the concept that there is no strict heirarchy of control. There seems be be a propensity of some people to disbelieve that anything can get done without a strict military/fascist type table of order.
And yet very successful examples are all around us.
Re:Cooperative (Score:5, Insightful)
> no strict heirarchy of control. There seems be be a propensity of some people
> to disbelieve that anything can get done without a strict military/fascist
> type table of order.
There does not exist a human organization in which everyone is equal (though some groups try to pretend).
Re:Cooperative (Score:2)
However, the style of cooperatives and consensus-driven organizations is that you don't institutionalize power differences. Just because people aren't equal doesn't mean that we must create and enforce a one-dimensional ranking.
Re:Cooperative (Score:2)
Even in cooperatives power is generally doled out according to who put in the most capital. In that sense they are run just like any other corporation. The folks fronting the money get to make the decisions. Any sort of business endeavor that is organized differently is doomed to failure. After all, why would I put my capital into a business, especially a risky small business, if some dork that doesn't put in as much capital as I do gets just as much say in how the business is run.
Re:Cooperative (Score:2)
Re:Cooperative (Score:2)
Some businesses such as Gore and Associates do a pretty good job of avoiding institutionalized command and control hierarchies. Hierarchies still exist based on a number of criteria of course, but they are based on persuasion rather than delegated power.
Personally I am looking into hybrid structures somewhere between your traiditonal C&C system and the lattice system that Gore has pioneered.
Re:Cooperative (Score:2)
So the slick con man with no skills other than the power of persuasion is now in control? Isn't that how we got GWB?
Re:Cooperative (Score:2)
Re:Cooperative (Score:2)
Re:Cooperative (Score:2)
Re:Cooperative (Score:2)
If the persuader thinks he is correct, and all he needs to do is convince someone, then is it really his responsibility to enforce some kind of, "Now that's just what I think. I'm certain I'm right, but you should come to your own opinion on this and vote your own way." Actually, that'd probably work better, since it displays some kind of balance and sensitivity.
Re:Cooperative (Score:3, Interesting)
Re:Cooperative (Score:5, Insightful)
I wouldn't think that co-ops would scale well. It is not all that hard to get 2 to 5 people to agree on a course of action. Much harder , but still doable with 10. But it is nearly impossible with 100 or 1,000. So it will just be a "majority rules".
Without some type of heiarachy, decision making can be much too slow in an "everyone is equal" environment. You need specialization and sub-grouping to focus on particular issues in depth. And some specialization will, inevitably, put some employees on different authority levels than others. For example, hiring and firing... with 1000 employees, there is no way that such an on-going staffing task could be done by "majority rules".
Another example is financing. How many of those employees will really understand finance enough to participate in the voting/control of the spending? Buying? Information Systems? Marketing? Etc.
Re:Cooperative (Score:3, Insightful)
Re:Cooperative (Score:3, Interesting)
Re:Cooperative (Score:3, Insightful)
Re:Cooperative (Score:4, Insightful)
With a vote? (Score:4, Insightful)
Re:With a vote? (Score:3, Insightful)
Unless of course you think the average worker is not qualified to make such decisions and they can shoot themselves in the foot?
Yeah your supposed to work together as a team but guys with clipboards and 4 function calculators have no bussiness telling MBA educated CEO's and board of directors business decisions. Apearently this is whats happening and many
Re:With a vote? (Score:3, Insightful)
Oh please. The people at Sun made decisions as to what products they wanted to make, how they were going to develop and market them, and what price points they were going to hit. Tens of thousands of people in other companies examined those decisions and decided if those products and that direction was right for them, and purchased accordingly.
Know what? They guessed wrong. People didn't want expensive, proprietary OS's (Solaris) and expensive, proprietary hardware (Sparc)
Our first order of business... (Score:3, Funny)
Five bucks says he used Vi to make the whole thing.
Re:Our first order of business... (Score:2)
Who's neck? (Score:2, Interesting)
Let's not knock communism, like all political ideologies it has it's faults, and the common flaw with most systems is the abuse of power. Even democracy has it's abuses
Re:Who's neck? (Score:2, Informative)
We don't need to knock communism—it does a great job of knocking itself.
I know they don't teach history in CS streams, but look it up. Communism has failed everywhere it has been tried, in spite of using force to keep everybody inside. You don't see a whole lot of American refugees lining up to become Cuban citizens. Ask your parents about the Aquarian 60's and the thousands of communes that formed in the US and Canada and lasted about two weeks before the cooperative spirit waned.
Business organi
Re:Who's neck? (Score:2)
Re:Who's neck? (Score:2)
Don't we already have this? (Score:2)
Re:Don't we already have this? (Score:2)
Re:Don't we already have this? (Score:2)
Re:Don't we already have this? (Score:2)
Use OS as byline.. free pass.. (Score:5, Insightful)
There's a valid and powerful reason for hierachy and divison of power(yeah, yeah I know it can get corrupted and all, that does not detract from my point!), because if everyone can go on willy nilly and do whatever they want, then what's to ensure something or heck anything get's done. It's get thing done.
Anyways OP's analogy is flawed, when is in a OS project everyone has equal say?
The project manager certainly has more say than a contributor, and there's nothing wrong with that.
And as much as I love OS and the prevailing spirit here.. can we stop granting aticles based on it just using
Re:Use OS as byline.. free pass.. (Score:2)
But if you have ever worked at a large company, imagine how much more productive you could be and how productive the company would be if the political issues could be avoided. Indeed at some large companies I have worked for, politics was the single largest area where energy was spent (sometimes even more than the main productivity goals).
The political problem is the main
Re:Use OS as byline.. free pass.. (Score:2, Insightful)
You accidentally stumbled upon the key issue.
Open-source projects are not democracies, but meritocracies. Participants who contribute better results naturally arise as leaders and therefore enjoy playing a larger role in decisions. The things a participant needs to do to move up the chain are perfectly aligned with the results the project needs to deliver to succeed. You don't get leaders who are more interested in their succe
It's called a co-op (Score:3, Interesting)
Many open source projects work because of
1. A charismatic leader, such as Linus.
2. The fact that if said leader misbehaves it's easy for even a small group of competent programmers to fork the project. This forces leaders to strive for consensus.
#1 can happen in a co-op (or a regular business). #2 is a lot harder in a business.
Employee Owned Corporation (Score:3, Insightful)
I doubt it (Score:4, Interesting)
Wars aren't won by armies praticing democracy... (Score:3, Interesting)
"Business is War" - Rising Sun
- and -
"We are here to preserve democracy, not to pratice it" - Crimson Tide
I've had some pretty shitty bosses in my career, and I'm now in the process of starting my own companies. One's bringing money in, the other will get there soon.
This is my comment(s):
In my current 9-5 job, whenever the democratic approach, people tend to debate things over until there's nothing left to be debated. Everyone in an organization fullfills different tasks, have different qualifications and skillsets as a result. If you were to run an org with true democracy, NOTHING will get done. You would have to A) make sure that EVERYONE understands WTF that they are voting on, B) you'd get so many different variants of ideas and sorting them through and then doing voting would be a nightmare, and C) there won't be any time left over from voting and hearing everyone's ideas.
What works best is soliciting a few ideas (have ideas bubble up to the top) then discussing a select few ideas that made it, and then having a decision made. A good leader would also justify why that decision is made (ie, I think this has merit, I"m aware of options X, Y and Z, but I'm chosing option D because of blah blah blah) and a good team should learn to stand behind the leader's decision. This of course goes both ways and assume a competant leader (which my current 9-5 job lacks, hence me heading off and starting my own business in the other 8 hours a day).
- SK
Equal say? (Score:2)
In a word, no. (Score:2)
I *do* think there is a lot to learn from the system, however. Where I work (not computer related, luxury good sales) there is no hierarchy at all. Everyone is on the same level. I *ask* to get things done, I can't order anyone. Everyone either is
It's a co-op, or even communism (Score:2)
This "article" is 40 years too late [wikipedia.org].
You can't run a progressive business via commitee - there has to be management vision and clear direction. Even with collaborative software projects, the popular ones have some kind of management layered over them before the masses get what they come for - Wikipedia, Linux, Debian - whilst collaborative, they're all at the top level controlled by a small group of people. I'd be interested if someone could name one truly popular, non-trivial, and actively developed Open S
It'd be too big of a shift. (Score:2)
It's a classic catch-22. If no one is in power, nothing gets decided. If the leaders rule with an iron fist and absolutely refuse to listen to the underlings, they can run the business into the ground. I think the best compromise is to keep businesses small. I've worked mainly for very large
Family (Score:2)
The hippies tried to replicate the family structure -- and that didn't work. The communists tried to do what families do -- and that didn't work. Churches try t
Try running a "normal" business first (Score:2)
I'm not saying this to be snarky. If you haven't already been involved in starting a business with three or more people, do that first. I think it will provide a lot of insight into why it is very difficult to make distributed decisionmaking work in a for profit environment. I'm not saying that it can't be done, but there are reasons why such entities have not risen to the top of the economic heap.
its been done before..... (Score:2, Interesting)
Re:its been done before..... (Score:3, Interesting)
"While the kibbutzim lasted for several generations as utopian communities, most of today's kibbutzim are scarcely different from the capitalist enterprises and regular towns to which the kibbutzim were originally supposed to be alternatives."
Yes, but you have to RTFM (Score:4, Interesting)
Re:Yes, but you have to RTFM (Score:2)
The problem, of course, is that you can only vote yourselves bread a
Name an open source project run this way (Score:4, Interesting)
It says something that the most succesful open source projects tend to be run on a model almost identical to a typical corporation. I believe Linus refers to it as the "benevolent dictator" model.
What the poster is describing is nothing less than mob rule. Theres a certain amount of this to all open source projects, but you'll find almost all have a small group of people ultimately making the decision about what direction to take. And of course if they make enough bad decisions, a portion of their developers can always create a fork
If anything, its the pirate form of democracy. Everyone gets their say, the captain makes the final decision, and if makes enough bad ones, they vote in a new captain.
Re:Name an open source project run this way (Score:2)
OS Business Plan vs OS Execution (Score:2)
Execution fails (mostly, the coop post contains great counter-examples) with extra folks.
Perhaps the sufficient part of this OS Business concept should be the businss idea and plan itself. We could work out a sustainable business model that would allow for differentiation in services/products or price, and so on.
An example of a market that can sustain this level of competition is health care. Differentiation in that sector invites regulatory scruntiny. So ho
That'a not how Open Source works (Score:2)
Keep dreaming (Score:2)
It's not too likely. One reason that corporations in the US and similar economies operate the way they do is that the law structures companies to operate that way at least shareholder held companies - companies that are owned by an individual can operate in all sorts of ways. Of course, you always have the option of forming one of these theoretical "ope
Google for... (Score:2)
The largest publicly traded one I know of offhand is SAIC (http://www.saic.com/empown/)
Open Source works when subsidized (Score:2)
Open Source works because it is usually subsidized. Volunteers donating their time, academics who have the freedom to work on what interests them, corporations who sponsor some project, etc. If you can find someone to subsidize your open source firm them you might be successful. Otherwise you will most likely fail like any other poorly run firm. Your post suggest that you do not realize that investors and bosses are roles
Re:Open Source works when subsidized (Score:2)
Open Source works because it is usually subsidized. Volunteers donating their time, academics who have the freedom to work on what interests them, corporations who sponsor some project, etc. If you can find someone to subsidize your open source firm them you might be successful. Otherwise you will most likely fail like any other poorly run firm. Your post suggest that you do not realize that investors and bosses are roles that have developed, evolved, over time because that has proven successful. Business c
Seems to be working for Semco (Score:2)
You can read an interview with the man responsible for the companies transformation (Ricardo Semler) on CNN here: http://ask.slashdot.org/comments.pl?threshold=1&mo de=nested&commentsort=3&sid=193884&op= [slashdot.org]
Nice idea... now try it (Score:2, Insightful)
As an initial dry run, let me suggest that you get together with 15 of your closest friends and see how long it takes to decide where to have lunch.
I predict one of two results:
1. One or two strong personalities take over and make a decision, or
2. You take longer deciding where to eat lunch than actually eating lunch.
In contrast, in my company (which I happen to be the boss of) I decide where to have our weekly lunch. It therefore takes 30 seconds. Other people get input
Why is Open Source a business model? (Score:2)
Having too many people involved in decisions is the best way for a company to kill its self. When you say "There isn't any limit on how many people can be involved (the more the better, in fact)" you destroy yourself. The more people you have, the more input that needs to be processed, and you quickly reach the Productivity Event Horizon where no one can do any work because they're constantly
Paging Bruce Sterling (Score:2)
A current example is the content production end of the US film industry, where a number of nominally independent contractors pull together to create a film, then break after the wrap, until someone pulls them together for another project. Granted, the components aren't equal (ie. the producer
Management by consensus (Score:2)
In a management by concensus environment, you sit everyone down for decisions and everyone gets to have their say. Until everyone agrees on a direction, nothing is decided. If a concensus cannot be reached, it must mean that the whole direction is wrong, so you move up a level and look at earlier higher-level decisions
Uberparent = Baiting Troll (Score:2)
Uber-parent, downmod, flamebait.
I serve on a church vestry. (Score:2, Interesting)
We are all volunteers afte
Look at envolution (Score:2)
Have a look at the Envolution project. The company involved tried to conceal access to both source and binaries for GPL software behind a subscription fee. They're not doing business anymore.
I think there was an alternative firmware for the Linksys WRT54G that did more-or-less the same thing.
Motivating the Employees (Score:2, Funny)
If a small tweak to the startup fee structure were made this could be quite lucrative for all us.
Right now there is a 25 euro signup fee that goes straight into the company coffers. That just doesn't make me feel motivated enough to go out and get the amount of new people to join the venture in order to make it succeed. Now with the following small tweak, we could reward people for signing up coworkers. We will start with a list of 7 unique people.
nightowl03d
nightowl
niteowl
notnightowl03d
not really n
But what color will the wheel be? (Score:2, Interesting)
I wish the OP luck in his/her business and will gladly admit closed-mindedness should this succeed, however, I predict the business will either quickly move away from this model for core decisions or fail from inertia of having to come to a consensus
Yeah, but... (Score:2, Insightful)
"In a world where people slave away for the sole profit of a board of directors and merciless shareholders"
Um, I work for a large, and very recognizable corporation, and I don't slave away for the sole profit of the board of directors nor merciless shareholders, or even an overpaid criminal CEO.
I get paid. And after my expenses are paid, I have a modest profit to show for my efforts. So do all of my coworkers, worldwide.
And most corporations function the same way.
Linux (Score:3)
That bit about people slaving away for stockholder profits is also nonsense. Unless they are really dedicated, they are doing it for pay and/or their own satisfaction.
Not entirely a new idea (Score:2, Informative)
Brazil is ahead of the rest of the world... (Score:3, Interesting)
Normal CEO's are Chief Unhappiness Officers [motherjones.com]. They steal everything they can, and act out their anger toward everyone they can.
One of the most important examples of a business run in an adversarial way is Microsoft, of course. After all this time, major media outlets are starting to get it right. Here are quotes from the CNN article Microsoft security--no more second chances? [com.com]:
"By now, Chertoff's people must be thoroughly frustrated that Microsoft still turns out poorly designed products."
"Here's something to consider: If bridge builders or airplane designers applied the same standards to their labors, do you believe that the public would so easily forgive the regularity with which bridges would collapse and airliners fall out of the sky?"
If you like the CNN article, don't forget to D I G G it.
Re:Brazil is ahead of the rest of the world... (Score:2)
The Wrong Analogy? (Score:2)
But the non-software analogy of an open-source business or project would be one
Free software is not "equal say" (Score:2)
Consider management by prediction market... (Score:3, Interesting)
As it turned out, they were finding empirically-better sucecss using these markets than they were with using their layers upon layers of bureaucratic, 20th-century-style management.
Frankly, I don't think management will ever go away *completely*; who else is going to create the items in the market upon which employees will bid? So on that note, I do think Time's title is a little over-zealous.
But at the same time, I do think such markets can be a force for flattening organizational hierarchy and reducing management headcount. And as more companies become enlightened to the idea of prediction markets -- rather than just mere internal polls, which, unlike a market, have no serious, direct incentive to make a correct decision -- they will turn to such markets instead of middle-managers, who tend to have been promoted into management because they are technically-incompetent and/or are better than other people at dressing well and kissing ass.
The "people's revolution", if there is ever to be one, will (in usual paradoxical economic form) probably not come at the hands of a communist dictator or a starry-eyed Euro-socialist, but rather, in the back rooms of corporate America.
Re:hahahahaha - im going to get involved then fork (Score:2, Interesting)
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Re:I will uncover my secret plan then... (Score:2)