Doing the Impossible: Managing Open Source Communities

Doing the Impossible:Managing Open Source Communities

Dr. Matthias StürmerSenior Advisor, Ernst & YoungJune 7, 2011

Matthias Stürmer, Ernst & Young

Short Bio Matthias Stürmer

● Senior Advisor at Ernst & Young EMEIA Financial Services since 2010

● Before at Swiss open source software provider Liip● Dr. sc. ETH Zürich at the Chair of Strategic

Management and Innovation of ETH Zürich, thesis on firm involvement in open source communities

● Business administration and computer science at University of Bern

● Founder and secretary of the Swiss National Parliamentarian Group for Digital Sustainability

● Member of the Board of Swiss Open Systems User Group /ch/open

Ernst & YoungBelpstrasse 233001 [email protected]: +41 58 289 61 97


Agenda

1. Forking today

2. Motivation and the private-collective model of innovation

3. Benefits and best practices of corporate community building

4. Balancing act between openness and control

5. Little surprise...


Forking today

OpenOffice.org LibreOffice


Forking today

MySQL

Drizzle

MariaDB


Forking today

Compiere Adempiere


Forking today

Nagios Icinga


Forking today

Are these all failed open source projects?


Forking today

No, the core team just didn't manage well its community.

Forking is the community‘s Sword of Damocles.


Agenda

1. Forking today






Like every country, every open source community is unique


Motivation for individuals to contribute

Intrinsic Motivation:

Can be enjoyment-

or obligation-based incentives

Internalized Extrinsic Motivation:

Can be non-monetary...

Extrinsic Motivation:

... or monetary incentives

● Ideology

● Altruism

● Kinship

● Fun

● Reputation

● Reciprocity

● Learning

● Own-use

● Career

● Pay

10 different reasons for individuals to contribute to open source software:

Source: G. F. von Krogh, S. Haefliger, S. Spaeth, M. W. Wallin “Open Source Software: a Review of Motivations to Contribute”


Firms adopting the open source model

Building a firm-sponsored community by renouncing some of the project's controlLevel 3

Revealing proprietary source code under an open source license → full control by the firmLevel 2

Integrating externally available open source software → open innovationLevel 1

Source: Matthias Stuermer 2009 PhD Thesis “How Firms Make Friends: Communities in Private-Collective Innovation”


Motivation for firms to contribute

Level 2: Legal constraints

forced contributions

Level 3: Business benefits

voluntary contributions

● GPL demands contributions

● Low knowledge protection costs

● Learning effects for the organization

● Reputation gain

● Lower costs of innovation

● Lower manufacturing costs

● Faster time to market

7 different reasons for firms to contribute to open source software:

Source: Matthias Stuermer, Sebastian Spaeth, Georg von Krogh 2009 "Extending private-collective innovation: a case study"


Theory to explain firm contributions

yes no

yes

no

open source software

Rivalry

Excludability

proprietarysoftware

private good club good

commons public good


Theory to explain firm contributions

1. Private investment model● Appropriation of financial returns from innovations through IPRs

→ patents, copyright, licenses, trade secrets● Knowledge spillover reduces innovator's benefits

2. Collective innovation model● Investments in public goods → non-rival, non-excludable● Free riding problem → public funding, governments

3. Private-collective model of innovation● Innovators privately fund creation of public goods● Example: production of open source software by firms


Private-collective model of innovation

● Free knowledge sharing● Explains conditions when innovators receive rewards from private

investments in public good innovations● Rewards from process of innovation surpasses rewards of free-riders

→ involvement in innovation process● Process-related rewards are larger than process-related costs

→ public good innovation● What are such rewards or incentives?

Sources:Eric von Hippel, Georg von Krogh 2003 “Open Source Software and the Private-Collective Innovation Model: Issues for Organization Science”Eric von Hippel and Georg von Krogh 2006 “Free revealing and the private-collective model for innovation incentives”Georg von Krogh 2008 “Researching the Private-Collective Innovation Model”


Agenda

1. Forking today






Why do managers want a community?

Benefits for open source project leaders having an active community:

● Free feature development● Free extension development● Free testing● Free bug reporting● Free bug fixing● Free customer support● Free documentation● Free marketing● etc.


Best practices incorporate community building

Two examples:

Eclipse by IBM

Maemo by Nokia


Evidence from the Eclipse case

Key benefits for IBM:

1. COCOMO: external contributions of 21.5 million LOC by 2007~ 214,000 man-months ~ 1.7 billion USD

2. Standard-setting in Java IDE, beating competitor Sun

3. Strategic platform for IBM software solutions: basis for proprietary applications

Source: Sebastian Spaeth, Matthias Stuermer, Georg von Krogh 2010 "Enabling knowledge creation through outsiders: towards a push model of open innovation"


What did IBM do?

1. Preemptive generosity● Revealing of initial Eclipse source code by IBM

2. Continuous commitment● Constant number of IBM programmers in Eclipse● Constant level of participation in newsgroups

3. Adaptive governance structures (giving up control)● Non-profit foundation with equal membership of firms

4. Lowering barriers to entry● Sub-projects by non-IBM people; modular architecture

Source: Sebastian Spaeth, Matthias Stuermer, Georg von Krogh 2010 "Enabling knowledge creation through outsiders: towards a push model of open innovation"


Nokia's (past) open source community building

● 2003: product decision for Nokia 770 tablet● 2007: successor devices N800 and N810● June 2009: Nokia partners with Intel for Maemo● August 2009: Maemo shall supersede Symbian as smartphone platform● October 2009: Nokia releases smartphone N900● March 2010: Nokia Maemo and Intel Moblin become MeeGo● March 2011: Nokia partners with Microsoft for Windows Phone 7...

(for strategic reasons)


What did Nokia do?



What did Nokia do?



Agenda

1. Forking today






Control of open source projects

Community-driven open source projects● Meritocracy: “exercise of control on the basis of knowledge” *

● Technical contributions and organizational-building behavior lead to authority and control **

Firm-driven open source projects● Why do firms want control?

● Business model: value creation and value appropriation

● Firms need control to appropriate returns of investment

● Balancing act between openness and control

Sources:* Max Weber 1978 “Economy and society”** Siobhán O'Mahony and Fabrizio Ferraro 2007 The emergence of governance in an open source community


Firms influencing open source projects

Corporations influence open source projects when...● firms reveal previously proprietary code.

● firms contribute code.

● firms control release management.

● firms employ core developers who previously contributed as unpaid volunteers.

● firms contract intermediary OSS firms and individuals.

Firm-driven open source projects face challenges such as..● lack of external contributions. (issue 1)

● possible crowding-out effects of intrinsic motivation. (issue 2)


Issue 1:Balancing act between openness and controlControl decreases contributions *

● Transparency increases contributions strongly **

● Accessibility increases contributions slightly **

Balancing is difficult● Too much control: communities may not contribute with all of their

energy, interest, and creativity

● Too little control: results may not serve the firm's goals

Sources:* Sonali Shah 2006 “Motivation, governance, and the viability of hybrid forms in open source software development”; Dahlander and Magnusson 2005 “Relationships betweenopen source software companies and communities: observations from Nordic firms”** Georg von Krogh, Sebastian Spaeth, Matthias Stuermer, Guido Henkel 2009 “The Credible Sponsor: Participants’ Motivation and Organization Attributes in Collaborative Digital Innovation


Issue 1:Effect of control on motivation

Perceived firm attributes Individual Identification, Motivation, and Contribution

⊘

Source: Georg von Krogh, Sebastian Spaeth, Matthias Stuermer, Guido Henkel 2009 “The Credible Sponsor: Participants’ Motivation and Organization Attributes in Collaborative Digital Innovation


Issue 2:Crowding-out of intrinsic motivation

Source: Matthias Stürmer, LinuxTag 2007 Berlinhttp://www.slideshare.net/nice/crowding-effects-how-money-influences-open-source-projects-and-its-contributors


Agenda

1. Forking today






Ernst & Young's new publication on open source● For your clients: Why and how to

professionally use open source software● Content:

● Benefits, risks and good practices● Professional application of

open source software● Legal aspects of open source● Background information on

open source software

PDF online end

of June 2011

Technology

Doing the Impossible: Managing Open Source Communities