From CEO to CNO

Leadership in the Age of Freedom and Totalitarism

Disclaimer: I’m going to become a Red Hat associate very soon (update 17th March 2016: I am already with Red Hat). This is nevertheless not a brown noser contribution, but pure passionated and personal opinion 😉

Why does working at so many large enterprises suck? Why do so many good fellas are mousetrapped with burn out after committing several years to a global player? Why can’t even a high salary compensate the frustration so people try breaking out of their S/VP positions founding new ventures? Why do vision and mission statements just don’t work?

There are many reasons for why it’s not fun working in a company with a military style leadership culture and why Tim Ferriss’ Four Hour Work Week became so exorbitantly popular.

When working for global enterprises, I often experienced the same feeling I had when e.g.

  • standing in an airport security queue,
  • trying to get customer support from another “world leader” — but just received complete support disasters,
  • after I entered a two-week travel reimbursement application and suddenly noticed that because one detail entered wasn’t valid I had to enter the entire application again.
  • After I spent a lot of money on my own hardware just for being able to work. Because the internal processes did not allow me selecting the hardware needed.
  • When I’m supposed to use politically correct terms (instead of being allowed to judge by myself when to use which words — that’s totalitarism IMHO).
  • When I listened to the investment company’s product managers making jokes about their “dumb customers” (“idiots” they said) and their plans how to squeeze the money out of them.

The ingredient missing here is basically: respect. It’s the ability of a company showing people either paying for their products or getting paid by the company that they don’t treat them as anonymous numbers but individuals.

At least when it comes to bad customer support, people will loose their passion for a product, may it be good or great. And guess — when it comes to treating employees without respect — they’ll might loose their passion both for the company and its products.

But passion at the customer and at the staff side is key, especially for the millenials and younger generations who already found out that the American Dream is nothing more than a Fanny Mae scam. 
We see (skipping the customer side and just pointing the curious e.g. to Lean Marketing, furthermore focussing on the staff related aspects) that younger generations want to produce something valuable.

Something more valuable than receiving the daily motivational teasers like “making the world better step by step” spit top down from the CMO into the organization.

In his book The Open Organization, Jim Whitehurst, CEO of the Open Source company Red Hat, describes how crucial passion is for organisations: In the long term the organisation with the more passionate people will beat its less motivated competitors.

Whitehurst describes his way from being COO of Delta Airlines (an extremely hierarchical, top-down organization) to being CEO of Red Hat, which not only appeared to have a completely different business model than it’s competitors (just leave some thoughts about how you would make money based on a product that is freely available and distributable), but also with an “organic” culture of discussion and reflection that ignores the formely known hierarchical communication structures.

Despite of having a democratic decision structure where every employee (called “associate” at Red Hat putting the employer-employee relationship into a completely different relation) has an equal right to vote. Instead there’s a so called meritocracy where basically the person with the best argument gets more influence. And normally that’s the people being most closely related to a problem. They decide — like e.g. at Starbuck’s where the person who cleans the floor decides which cleaning supplies to buy.

For a C-level manager this means that instead of following a top down model — sending directives to his managers who then push it down to the organization — she/he has to transparently communicate strategic goals first and then ask for help. The message behind this is: “I want to go to this point. Could you please a) tell me if that’s a good idea and b) how to get there?”

For Red Hat this means seemingly endless discussions. The manager’s responsibility here is to extract the value, the actionable results out of such discussions. She/he acts rather as a catalyst. It’s no wonder that Red Hat’s mission statement — result of a very long discussion as you might imagine — highlights the catalyst role:

To be the catalyst in communities of customers, contributors and partners creating better technology the open source way.

That’s in my opinion a complete shift in management, in how to treat people (independent from whether customer or employee or — like at Red Hat — the contributors to all the open source projects that are the foundation of Red Hat’s commercial offering) and how to deal with their contributions.

The role of the CEO is more that of being something like the “first catalyst” (or “Catalyst Number One” == CNO).

I think becoming the CNO is the key challenge for 21st century CEOs. The more people will become aware of the culture at Red Hat and the companies mentioned in the book, the more want to be part of it. CEOs of traditional companies must create an Open Organization strategy pretty soon or they won’t have people doing the work.

Nevertheless, there are still questions left open in the book: How is performance management done? What about payment structures?

There might be some long discussions about these topics on the horizon…


Originally published at on January 24, 2016.

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