Red Hat: Openness in their DNA

Dirk-Peter van Leeuwen (DP), the APAC region’s senior VP and GM of Red Hat, the world’s first (and maybe only) open source company to hit the billion mark in revenue said, “Nothing we supply wouldn’t be visible to the entire world. Anybody can go online and look at how our products are made.”

This is true of the open source ethos which van Leeuwen or DP further described with, “Our level of transparency is such an open part of open source. We can’t misrepresent things, because we would be immediately corrected by somebody.”

This among other things are leading to Red Hat actually coming up the ranks in terms of being ‘the go-to company’ when organisations want to innovate or embark upon a digital transformation journey.

During Red Hat’s Summit 2018 in San Francisco, CEO Jim Whitehurst had also said it, “We want to leave people with the message that with the new set of challenges that enterprises around the world have, open source is becoming a significant part of the solutions and Red Hat is key part to that.”

During our chat at the same summit, DP had said, “We have to stay focused on customer success and customer satisfaction. The business model we have is modelled around adding value.

“And we compete with the incumbent proprietary tech vendors by taking their market share and creating new opportunities for our customers.

“Our competition is having a hard time keeping up with it, because of the nature of our business… it’s hard to compete with something that is free,” DP said emphasising that every company Red Hat competes with right now are competing with their intellectual property (IP), while Red Hat themselves doesn’t have any IP.

Being open

“Openness is something we live in our own organisation.  We try to be extra transparent and open and it becomes our company culture,” said van Leeuwen who also stressed that this openness is the cornerstone of DevOps, a style of software development that emphasises removing siloes and integrating teams within organisations.

Claiming that consultancy services isn’t something they want to offer, DP pointed out that Red Hat helps instead with architecting the solution, and incubating the culture aspects of openness.

“It’s a practice we incubate in our own Open Innovation Labs,” he said.  ‘We don’t want to be a consulting organisation but we have responsibility to provide best practices to the industry, so we train and enable our partners to deliver consultancy, instead.”

APAC growth and challenge

DP observed Red Hat’s slow change from interacting with tech teams to now increasingly engaging C-levels. “Because of the spread of challenges and tech that C-levels have in terms of what they need to address, when it comes to DevOps, it is now a CEO issue.”

Moving forward, while he appreciates the diversity of the APAC region he oversees, he has concerns about recruitment. “Growth has been phenomenal, and this is attributed to the people in the team.

“But as we hire new people, they come from different companies with different cultures – how do we make sure we don’t lose our culture. Now there are 13,000 people. When I joined it was 400. Worldwide.”

Growth is a good problem to have, and this commercial open source company has been able to weather the challenges of growth that comes with 64 uninterrupted quarters of revenue increase. In other words, they are scaling their business quite admirably.

But they face a challenge that not many other technology companies face.

A culture of openness is a very tough act to follow. And from DP’s statements, Red Hat is extremely serious about walking all their talk about openness and transparency.

He points out that sales and technical people in Red Hat often come from large traditional IT organisations. “So to me, it’s important they are eager to understand and live and learn our culture,” he said.

Red Hat Open Innovation Labs in this region, as well and London and Boston, give customers and ecosystem players a chance to immerse in Red Hat culture, and even get a brief taste of  the open source ethos that underlie so many open source community projects today.

Public sector

Of the many industries that Red Hat goes to market in, the public sector audience is special.

According to Red Hat’s CEO, their sales capability that’s specific to the public sector is literally a separate business unit within the organisation. “We are building it out in Europe and in several parts in Asia,” Whitehurst had shared.

“It’s a great place for Red Hat. Most governments are looking to buy good tech, but with the good of country in mind. Our prices are lower, there is no need to pay a huge IP tax so more dollars stay in country. Our code is transparent, it’s good to be able to see code (for security).”

All of this calls for a specialised way to sell to the government sector, which Red Hat recognises and is addressing with their brand of open and pay-as-you-use value proposition.