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CEO Insight: Rethinking how we work in an era of disruption
Source: Procre8 for Red Hat , Author: Posted by BI-ME staff
Posted: Tue July 10, 2018 5:37 pm

UAE. As the waves of disruption continue to shake every industry, we’ve hit a new tipping point. Based on conversations I’ve had with executives all over the world, all of whom face these similar challenges, I’ve come to realize that merely tweaking how we work is no longer good enough.

While we know what the problem is—the pace of change wrought by digital transformation—it’s far less clear what we need to do about it. How do you remain nimble and agile enough, at scale, to deal with unknown challenges headed your way?

That’s not something you can just order up online or buy off the shelf. It’s more than a technology problem. We need to encourage people to think differently. But who do you start with and how do you get them involved to make changes?

In short, I believe it’s time for a radical rethink in how we organize to get work done. Those that fail to rethink will be disrupted and face extinction. And we can look to open source for the answers to dealing with digital disruption.

Rethinking the organization
The hierarchies and bureaucracies that are so commonly used today were optimized for their context. They were a well-engineered solution to the problem at hand in the late 19th and early 20th centuries. It was all about defining a competitively-advantaged strategic position, dictating a plan and efficiently executing that plan by coordinating activities and driving compliance.

But in a volatile, uncertain world, our ability to predict and define strategic positions is diminishing, reducing the value of classic long-term strategic planning and execution. Since the problem has changed, so too must the solution. When looked at this way, it shouldn’t surprise anyone that the optimally-engineered solution to coordinating in today’s world will look radically different than that of the industrial era.

The fundamental plan, prescribe, execution system of the past worked well in a static environment where change occurred slowly and predictably. But now, in the face of constant change, it creates brittle, inflexible and, therefore, inefficient structures incapable of keeping pace with change.

Prescribed tasks also drain initiative, drive and emotion out of people. While this has been a barrier dating back to the advent of the first assembly lines, the issue has become even more acute as the nature of work has evolved away from performing rote tasks, to now, when employees have far greater expectations about the value and intrinsic returns they reap from their work.

This shift shouldn’t be mistaken for automation. Automation changed how we accomplish work. Digital transformation has forced us to rethink how we actually organize to even decide, distribution and coordinate the work. Automation required processes to change, digital requires people to change.

In short, if we want our people to change, we need to reconfigure how we work together in radically new ways. And we can look to open source communities—where so many pioneering models of organizing to get work done have emerged—as a guide.

Configuring for change
What we’ve learned at Red Hat is that you need to build the capability to change into your organization from the bottom-up using an open source approach. As I noted earlier, this is more than a technology story: it’s about empowering and enabling people inside the organization to think and act in new and innovative ways. It’s about embracing a culture shift that embraces limitless possibilities and ideas worth exploring—without sacrificing speed, performance or security.

We’ve found that when it comes to rethinking how we organize to get work done, we need to focus on three primary pillars that have been foundational in open source communities for decades:

1. Planning must be replaced by configuring for constant change:
  - Processes inside the organization must be focused on experimentation and learning (try, learn, modify) rather than planning.
  - Organizational structures need to become more focused on modularity and on the end customer more than on efficiency and specialization.
2. Prescription must be replaced by enablement:
  - Rather than making decisions from the top down, driving direction now requires pushing decision-making power—and the information required to make them—to the people closest to the impact of those decisions.
3. Execution must be replaced by engagement:
  - Rather than enforcing rules and dictating actions through a compliance model, organizations must embrace new techniques for motivating the right behaviors. It’s essential to recognize that you can’t micromanage complex work.
  - More than a focus on collaboration, organizations must be more focused on how teams and individuals coordinate with each other to get their work done.

Of course, this is a suggested framework that requires a few disclaimers. There is no better/worse or right/wrong way to organize. Rather, there are simply better ways to optimize organizations for different contexts. Every organization has a mix of activities that fall on different points of the optimize/innovate spectrum.

Recognizing this, and that there are different approaches required to optimize for each one, is a critical step in defining how your organization should be configured. Finally, it’s all about culture. But culture is an output, not an input. Observing well-functioning culture is interesting, but what’s really required is to define the context that generates that culture.

So while good culture can overcome any of these problems, it’s these problems that impede you from achieving the culture you desire.

While culture change is hard, ultimately, it’s only possible if leaders are willing to open up and change themselves.

Planting the seeds for change
The CEO of one Fortune 100 company described the kind mind-shift needed to lead change in our new digital world as a “transformation of self.” It requires moving from defining direction and driving performance, to creating the context for your people to do their best work. That’s what makes the people component of open source so powerful, engaging, and dynamic.

You can even think of leadership along these lines as something like farming.

Your role as a leader is to create the context and the conditions for your plants to grow from the seeds you plant. You can’t order your plants to grow—or to avoid disease and rot. You have to assess which plants might grow best given the conditions you create. You can’t expect a cactus to thrive in a rainforest, for example, just like thirsty tomatoes can’t survive in the desert.

You need to give your plants the best possible shot, given their nature, and get out of the way. When you can do that, you’ve created the optimum conditions to reap incredibly positive results even in the face of massive disruption and change.

Photo Caption: Jim Whitehurst, president and CEO, Red Hat

About the author
Jim Whitehurst is president and chief executive officer of Red Hat, the world’s leading provider of open source enterprise IT software solutions and services. Whitehurst is an avid advocate for open software as a catalyst for business innovation.

With a background in business development, finance, and global operations, Whitehurst has proven expertise in helping companies flourish—even in the most challenging economic and business environments.

Whitehurst has grown Red Hat and its influence on a variety of industries, by reaching key milestones—the most notable in 2012 when Red Hat became the first $1 billion revenue open source software company. Since joining Red Hat, Whitehurst has grown revenue from more than $500 million at the end of February 2008, to almost $3 billion for the company's 2018 fiscal year.

Under his leadership, Red Hat was named to Forbes’ list of “The World’s Most Innovative Companies” in 2018, 2017, 2016, 2015, 2014, and 2012; named to Fortune’s list of the Most Admired Companies for 2018; added to Standard and Poor’s (S&P) 500 stock index in 2009; named one of the best places to work by Glassdoor in 2016, 2014, and 2013; named to the first-ever Fortune Future 50 list in 2017; and added to the Forbes’ Global 2000 list in 2017. In addition, in 2018 Whitehurst was named one of the World’s Best CEOs by Barron’s.

In June 2015, Whitehurst published a book with Harvard Business Review Press entitled "The Open Organization: Igniting Passion and Performance" showing how open principles of management—based on transparency, participation, and community—can help organizations navigate and succeed in a fast-paced connected era. To date, the book has sold more than 42,000 copies; been featured in more than 130 press articles including articles from Fortune, Forbes, and Fast Company; and named one of the top 10 creative leadership books of 2015 in Forbes.

During his six-years at Delta Air Lines, Whitehurst drove significant international expansion and as Chief Operating Officer, oversaw all aspects of airline operations—from sales to strategy. At The Boston Consulting Group, where he began his career in 1989, he held several corporate development leadership roles, working in the Chicago, Hong Kong and Shanghai offices, and as a partner in the Atlanta office with numerous clients across a wide range of industries.

 

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