Posts tagged ‘open source’

Integrative Thinking

As I wrote before, I am currently reading Roger Martin’s The Opposable Mind. Martin believes that for some business leaders, a certain method of thinking has contibuted to their success. Integrative thinking, according to Martin is the ability to keep multiple options, which may even be contradictory, in play as viable options when facing any business

For example, Red Hat is a software company offering Linux, a FREE computer operating system. When open source software like Linux was first introduced and becoming popular, distributors made money by selling disks for a nominal fee (perhaps around $15). This is of course much more attractive than the hunderds of dollars competitors like Microsoft were charging for a proprietary system. Bob Young, co-founder of Red Hat rejected the tradtional model used by Micrsoft et. al. He much preferred the collaboration and innovation that the open source community could provide in a very nimble way. He also knew that selling CD’s for $15 was not going to be a profitable business model.

Hindsight is always 20/20, so it may not appear to be such a breakthough using the lens of today, but These two models were accepted as reality in the industry. There was an impasse. But Martin identifies Young as an integrative thinker, to revoltionized the open source software community by ofering the software for FREE (as an internet download) and combining that with services (training, installation, consulting, etc). The prodcut price enabled Red Hat to undercut practically the entire market, giving them substantial penetration. The high-margin services gave them an immediate and lucrative path to profit.

Young excercised integrative thought in finding this solution. From the incongruity of 2 traditional models, he saw the oppotunity for a innovative third model.

January 14, 2009 at 9:00 am Leave a comment

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