Open allocation refers to a style of management in which employees are given a high degree of freedom in choosing what projects to work on, and how to allocate their time. They do not necessarily answer to a single manager, but to the company and their peers. They can transfer between projects regardless of headcount allowances, performance reviews, or tenure at the company, as long as they are providing value to projects that are useful to the business goals of the company. Open allocation has been described as a process of self-organization. Rather than teams and leadership arrangements existing permanently in a company, such relationships form as they are needed (around important projects) and disband when they are no longer necessary. Additionally, open allocation implies that projects are not unilaterally created and staffed by executive mandate. Rather, the person forming the project (who might not be an official manager) is responsible for convincing others to invest their time, energy, and careers into the effort.
History The term lattice organization for an organization using open allocation was coined by Bill Gore in 1967. He used the term to describe the company he founded, W. L. Gore and Associates. Google introduced and publicised an unusual perk known as 20% time, in which - in theory - employees have freedom over one-fifth of their working time, which may be put into a personal project or a high-priority internal effort outside of management's direction. However, the other 80% of the time employees would be still working under closed allocation, and also may not in practice be able to use their 20% time all of the time, for example due to deadline pressures. While startups vary wildly in work environment quality and employee autonomy, one of the main selling points of technology startups in the early 21st century has been a claim - demonstrably true of the best startups, but not of all of them - that employees enjoy a high level of autonomy, at a level traditionally only seen in basic research labs. GitHub and Valve, in the early 2010s, became well known for having such environments. In 2013, Tom Preston-Werner gave a talk at Oscon in which he spoke about the importance of open allocation to GitHub's success.
Leadership under open allocation Organizations using open allocation do not give middle managers unilateral control over their reports' work. People management, product direction, and project-specific leadership are, in this way, decoupled. One argument in favor of this is that when the people defining projects no longer have the unilateral ability to terminate employees or deprive them of opportunity, better projects and leaders (those that can convince, rather than coerce) will emerge. Middle management may play roles, however, in mentoring, handling of conflict (as an absolute last line of dispute resolution), and (especially) ensuring that new hires are appropriately "onboarded" into the open allocation system. Leadership in an open-allocation organization is typically organic; the person to propose the project will lead it, if he or she can convince others to follow. When projects end, the leaders may rotate back into being "followers", and there is no stigma attached to this. Leading and following are temporary distinctions and largely by choice; one may choose to follow in order to learn more about a different part of the business, for example. Ideally, the leader for each project will be the most committed, capable or passionate person involved, and companywide rank (which may not exist at all) has little to no bearing on the selection. Performance reviews in open allocation companies are handled in a variety of ways. Valve uses stack ranking driven by peer review to determine raises and bonuses, but unlike the hated stack-ranking regimes of some other technology companies, these do not initiate termination or interfere with internal mobility, but are strictly used to determine compensation.
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