Paul Graham Essay Alert: What Business Can Learn From Open Source

Paul Graham has a new essay out, which means that you need to click on this link, stop reading my blog, and start reading his thoughts.

For those who want a little more background first, Paul’s latest essay discusses what business can learn from open source. Specifically, why is it that Microsoft, the world’s richest corporation, can’t make a browser that’s as good as Firefox?

Paul carefully examines just how unproductive the average business environment is, and sums it up nicely with three points:

(1) that people work harder on stuff they like
(2) that the standard office environment is very unproductive
(3) that bottom-up often works better than top-down

The irony is, as Paul points out, open source and blogs are more like free markets, while the standard corporation is more like a Communist state.

I’ve noticed this myself, in the sense that the bigger the organization I’ve worked with, the farther its employees seem to be removed from the realities of the product and factor markets. The smart people of Pfizer spend more time worrying about internal politics and regulations than about how to make good drugs.

I’m not sure how a regular business can benefit from Paul’s insights, but they go a long way towards explaining why I always work in startups, and refuse to even contemplate the corporate life.