The five pillars of open-sourcing

While today’s fiercely competitive corporate climate encourages most businesses to guard their knowledge, others are seeing the benefits in sharing information to help drive innovation of products and services.

Open-sourcing has become a term synonymous with the software industry — where code is shared, and accessible, among many to improve it and help it evolve. Microsoft, for example, has recently announced that it is opening larger swathes of its .NET Framework (which creates software interoperability) to the greater world.

Open innovation, as a broader term, is used to describe the sharing of information and ideas with others, to drive the creation of better products and services — in other words, it’s not just about software. This way of working is viewed with mistrust by many corporates, who jealously guard and protect what they own and create. But companies such as Vodafone and Starbucks — all covering a variety of industries — are among those that look for advice and inspiration from outside their walls.

There is a vast range of “ideas factories” online, whether it be to help Vodafone receive thoughts about its mobile apps, or help Heineken come up with a draught beer system for the home.

But what else can be “open”? Politics? Surely not — but using open-source software and platforms to enable political debate, upon which the policymakers and politicians then act, is a variance of open innovation.

Brett Scott, writer of The Heretic’s Guide to Global Finance, has a fascinating take on the world of finance and how it might be a much betterserving industry if it operated in an open format.

He suggests that the importance of financial services to the world means that it needs to operate openly. Financial intermediaries use information to create financial instruments, but this information and data is guarded jealously and fought over. “They battle to monopolize relationships, monopolize information and to monopolize specialist knowledge of financial techniques,” Scott says in his blog. “We have very little direct access to the means of financial production ourselves, very little say in how financial institutions choose to steer money in society and very little ability to monitor them.”

So, Scott calls for what he sees as the five key pillars of open-sourcing:

  1. A production process that encourages participation
  2. A distribution process that encourages widespread access to usage rights
  3. An accountability model that offers the ability to monitor and contest changes
  4. A community built around it that maintains the ethic of collaboration and continued commitment to open access
  5. Open source code that can be accessed and altered if the current incarnation doesn’t suit

And how could this relate to the world of finance? The five pillars could map to: peer-to-peer funding, mobile banking, data mapping that shows the corporates and governance structures of institutions, community financing and campaigns created to disrupt and drive change.

“As projects within these five pillars emerge, the infrastructure, norms and cultural acceptance for a more connected, creative, open financial system may begin to emerge and coalesce into reality,” says Scott.

The article was written by:

  • Christian Doherty

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