Section TwoOpen-Book Management
The practice of sharing financial and performance information is
often referred to as open-book management. Essentially, the
practice relies on the notion that empowered employees can
make informed decisions and take informed actions on behalf
of the firm. Because employees have the information and are
empowered, they are almost compelled to take action. Jack
Stack of Springfield Manufacturing has been credited for being
the inventor of open-book management. Stack acquired a
nearly bankrupt plant from International Harvester and was
able to achieve a remarkable turnaround through the use of
open-book management. One of his most critical changes in
implementing open-book management was to help employees
think of the firm as a business instead of an organization that
reconditioned diesel engines. Interestingly, “He persuaded
employees to view running the business as a game they could
learn to play—and win.”^58
Open-book management is broader than many human
resource practices as it combines a number of practices such as
profit sharing, use of bonuses, scoreboarding (reporting results
on score-boards), and training employees to understand the
business. It often places heavy emphasis on the use of games
in which the objective is to defeat a problem instead of other
employees. Typically, firms that practice open-book