What Business Can Learn from Open Source and Blogging:
Now a days companies are obsessed about increasing their market share: http://www.hbsp.harvard.edu/hbsp/hbr/articles/article.jsp?articleID=75602&ml_action=get-article&print=true
The greater amount of market share they have the better. Control over the market is tight and they make insane amounts of profit over it. Monopolies allow the main company to control market pricing and quantity. But do monopolies really work?
Microsoft is a good example. Open office has taken source code for an open office software and has basically imitated Microsoft Word. Is it better? Probably not- at least in my view it’s not, but perhaps because it is relatively new and enough people haven’t messed around with the original code yet. Firefox is most definitely better than Explorer and that just shows how even with a monopoly, Microsoft still loses to Free Coders.
But What is it about openness that makes it so successful? Best article there is on the subject: http://www.paulgraham.com/opensource.html
“Like open source, blogging is something people do themselves, for free, because they enjoy it. Like open source hackers, bloggers compete with people working for money, and often win. The method of ensuring quality is also the same: Darwinian. Companies ensure quality through rules to prevent employees from screwing up. But you don’t need that when the audience can communicate with one another. People just produce whatever they want; the good stuff spreads, and the bad gets ignored. And in both cases, feedback from the audience improves the best work.
Another thing blogging and open source have in common is the Web. People have always been willing to do great work for free, but before the Web it was harder to reach an audience or collaborate on projects.
the three big lessons open source and blogging have to teach business: (1) that people work harder on stuff they like, (2) that the standard office environment is very unproductive, and (3) that bottom-up often works better than top-down.”
Multiple foundations/collaborations for Open Business models have been established:
1. Open Business Foundation : http://openbusinessfoundation.org/
http://openbusiness.cc/ Open Business Platform, to share business models.
2. And our very own MIT Sloan School of Management has published http://sloanreview.mit.edu/wsj/insight/pdfs/48208.pdf
On why companies should have open business models.
And of course if there is no “open” resource about it, there are experts that you can pay to learn about it: http://nissan.justanswer.com/?r=gacar&JCRN=Nissan%20Mechanics&gclid=CLT_mtixg5QCFQNHFQod3nibWQ
There are places where open business models work:
Southwest Airlines Business Model (MIT): http://ocw.mit.edu/NR/rdonlyres/Sloan-School-of-Management/15-761Operations-ManagementSummer2002/7370C22B-1762-4B76-BE28-775A0987C8AC/0/lec25swa.pdf
But then there are also cases where absolute secrecy is necessary:
- Pharmaceuticals: If the secrets to how medicines are made are let out, what’s the point of developing them? It takes years and millions of dollars to develop a new drug but only a few seconds for another company to imitate. If everything were “open source” what would be the motivation to create new medicines? People are dying yes, but someone else can figure it out.
- Weapons Technology/War planes and Ships- these are self explanatory. Improvement is a good thing, but there are just some things that don’t need improving.
