What is the difference between open and closed systems of organization?
Karl Popper described the differences between open and closed societies. In an open society, freedom and individuality are paramount. In a closed society, by contrast, collectivism and oppression are common. In other words, in an open society people get to make choices and in a closed society choices are made for them.
If you organize your company with an open organization, you will want to foster creativity and allow for individuality. There will be less of a top-down structure and more freedom for employees and subordinates.
By contrast, if your company is a closed organization it will be more important that everyone follows the company doctrine. Individuality will be discouraged, and individuals will make decisions according to rules and company policy.