How Red Hat shapes its environment
In young, high-growth innovative industries such as internet software, certain companies are able to “shape” the entire environment, rallying an ecosystem of customers, suppliers and partners by defining attractive new markets or standards. Jim Whitehurst, the CEO of Red Hat, the world’s largest provider of open-source software, shares the experience of his company in building such a community.
Software provider Red Hat grew from the open-source movement, and though it has built itself into a $1 billion business over the course of two decades, it still has open source and a sharing spirit in its DNA. In fact, it is an example of an “orchestrator,” or a company shaping a whole ecosystem to its advantage, in the language of Your Strategy Needs a Strategy. For its part, however, Red Hat thinks of itself as a “catalyst” within a community of customers, contributors and partners, all working to, “create better technology the open source way,” as its outlined in its mission statement. But how did it build a profitable business based on open-source software, which after all is essentially free of charge? … Read this article
To read the article in full:
Based on Your Strategy Needs a Strategy: How to choose and execute the right approach by Martin Reeves , Knut Haanaes , Janmejaya Sinha (Harvard Business Review Press, June 2015) and the interview with Jim Whitehurst, CEO of Red Hat, USA, July 2015.