Collaboration Strategies fuel Growth & Success

By : Jim Pinto,
San Diego, CA.

With continued, accelerating change, companies can achieve significantly more through collaboration - sharing business information with suppliers and customers. Collaboration is a key enabler, allowing companies to react more quickly to changes in supply and demand. In the next few years your enterprise will be collaborative, or it won’t exist at all.

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Check out, September 2007

With continued, accelerating change, companies can achieve significantly more through collaboration. This means the sharing of business information rapidly and effectively with suppliers and customers – and perhaps even suppliers’ suppliers and customers’ customers. Collaboration brings major benefits for all the companies involved.

Today, the pace of business is so rapid that few can predict its twists and turns. Change is sometimes so rapid that even long-standing relationships may falter. Yesterday’s valued supplier may become tomorrow’s competitor. Or, large customers may suddenly disappear, victims of rapid technology shift or offshore transfers. A dependable software supplier may suddenly be a merger casualty, making already-installed software a casualty of obsolescence.

Companies must seek ways to drive additional revenues and profits from existing, relationships through increased collaboration – sharing of information, joint planning and projections. The Harvard Business Review reports that a 5% increase in customer retention can result in a 25% to 95% increase in profits from collaborative relationships.

Collaboration is the best way to interact

There are three primary ways in which humans interact: conversations, transactions, and collaborations:
  • Conversational: An exchange of information where the primary purpose of the interaction is discovery or relationship building. There is no central entity around which the interaction revolves but is a free exchange of information with no defined constraints.
  • Transactional: Involves the exchange of transactions (for example, purchase orders) which alter the relationship. Interactions are most effectively handled by systems that record, manage and complete the transaction.
  • Collaborative: Completely alters the effectiveness of the interaction between collaborators. Examples include the development of an idea, creation of a design, and achievement of a shared goal. Real collaboration technologies deliver the functionality for many participants to augment a common goal.
Collaboration is a process defined by the recursive interaction of knowledge and mutual learning between people who are working together toward a common goal. Collaboration does not necessarily require leadership and can even bring better results through decentralization and egalitarianism.

Collaboration Models

The majority of collaborative environments to fit into one or more of five primary collaboration models:
  • Library: Reciprocal access to common content or data used in asynchronous or real-time collaboration
  • Solicitation: Requests from a small set of requestors and multiple responses from respondents.
  • Team: Few members who share common objectives and have a shared stake in their success, are interdependent, allowed to both read and write content, with a high level of interactivity.
  • Community: Facilitate the activities of a community, with many members who have common interest and goals, seek to share information. Large communities are often moderated, facilitated or edited and all members are encouraged to both read and write content. Most members find value in just reading.
  • Process Support: Use of collaboration technologies in a process or workflow. Frequently performed or critical processes, that require collaboration include: new product development, sales/marketing, customer service and support, training, supply chain management.
Communication can be thought of as unstructured interchange of information. A phone call, email or instant-messaging discussions are examples of this. Collaboration refers to interactive, interdependent work toward a shared goal. Brainstorming is an example of this. A good metaphor for understanding this is to think about a sports team: everyone has to contribute the right play at the right time as well as adjust their play to the unfolding situation. But, in order for the team to win, everyone is doing something different. That is Collaboration: complex interdependent work toward a shared goal.

To ensure that a company stays competitive and operates at optimum production levels, it is imperative that efficient collaboration between all business lines and processes exists and grows. The goal is to make knowledge workers more efficient. In addition to managing a role that is specific to a knowledge area or worker, it is necessary to manage all the information that is trapped within the total process, internally within the organization, and even externally with customers and suppliers.

Collaborative Groupware

Collaborative software, or Groupware, can be divided into three categories depending on the level of collaboration—communication tools, conferencing tools and collaborative management (co-ordination) tools.

Tools that manage business processes and manage information applications, including workflow and project management already exist as stand-alone entities, but their value cannot be realized at the levels they originally promised. Workflow management is usually not integrated with project management and vice versa. To intelligently source out the information that is trapped within an enterprise and then integrate it with existing applications we need something more than stand-alone tools. Collaboration is achieved when applications integrate with processes, projects and information in real-time across the virtual enterprise.

Many companies are already working to collaborate internally, within the organization, through groupware. What is being suggested here is that Groupware could and should be used to enhance collaboration with external partners – customers and suppliers.

Management of Collaboration

This challenge is a long-standing one for senior managers: How do you get people in your organization to work together across internal or external boundaries? To service multinational accounts, you increasingly need seamless collaboration across geographic boundaries. To improve customer satisfaction, you increasingly need collaboration among functions ranging from R&D to distribution. To offer solutions tailored to customers’ needs, you increasingly need collaboration between product and service groups.

As competitive pressures continually force companies to find ways to do more with less, few managers have the luxury of relying on their own dedicated staffs to accomplish their objectives. Instead, most must work with and through people across the organization, many of whom have different priorities, incentives, and ways of doing things.

Getting collaboration right promises tremendous benefits: a unified face to customers, faster internal decision making, reduced costs through shared resources, and the development of more innovative products. But despite the time, money and effort spent on initiatives to improve collaboration, few companies are happy with the results. Time and again management teams employ the same few strategies to boost internal cooperation. They restructure their organizations and reengineer their business processes. They create cross-unit incentives. They offer teamwork training. While such initiatives yield the occasional success story, most of them have only limited impact in dismantling organizational silos and fostering collaboration—and many are total failures. It’s important to understand why.

The Myths of Collaboration

Most companies respond to the challenge of improving collaboration in entirely the wrong way. They focus on the symptoms rather than on the root cause of failures in cooperation: conflict. The fact is, you can’t improve collaboration until you’ve addressed the issue of conflict. Many mistakenly assume that efforts to increase collaboration will significantly reduce that conflict, when in fact some of these efforts—for example, restructuring initiatives—actually produce more of it.

Executives underestimate not only the inevitability of conflict but also its importance to the organization. The disagreements sparked by differences in perspective, competencies, access to information, and strategic focus within a company actually generate much of the value that can come from collaboration across organizational boundaries. Instead of trying simply to reduce disagreements, senior executives need to embrace conflict and manage the mechanisms for managing it.

The Stakeholder Strategy

In today's networked, highly competitive, and global economy, value is created collaboratively between a company and its stakeholders – employees, investors, customers, suppliers, and communities. The book, "The Stakeholder Strategy" presents an approach to management that is focused on collaboration. It addresses concerns about the bottom line (can collaboration increase profits?) and societal pressures to improve overall quality of life. It also includes a practical step-by-step guide, which companies can use to forge a network of powerful and profitable collaborative stakeholder relationships.

The Stakeholder Strategy shows business leaders and managers how to establish and maintain positive, mutually beneficial stakeholder relationships. Based on a synthesis of ideas from community relations, marketing, stakeholder management, organizational change, sustainability, and corporate social responsibility literature – and featuring case study examples from companies around the world who are working to build collaborative relationships with their stakeholders – it offers an integrated framework, as well as the practical tools for developing new kinds of collaborative relationships.

Effective Collaboration

To collaborate effectively, company employees must work in extended virtual teams comprising colleagues, as well as customers and supplier partners. Just as collaboration between separate departments within companies proved to be very effective in the past, now collaboration must be extended beyond conventional corporate boundaries. Working in multi-company environments, transcending international boundaries, people must be assigned to establish collaborative relationships. These may be short-term, project-focused or long-term multi-project planning staff. Strong mutual inter-company benefits will build relationships, and yield results. Companies must invest in selecting the right people who can learn how to work with suppliers and customers and determine how to extract the most value in terms of mutual revenues and profits.

An effective enterprise collaboration solution must provide the technical systems links for people to work together in distributed, cross-organizational teams. Effective communications must be enabled across distance, time zones, and company borders, encouraging team members to discuss, analyze and review information collaboratively.

This kind of collaboration expands the conventional borders of the company. People can utilize the work experience of others in the extended enterprise and learn organizational practices and methods from peers in collaborating companies. Team members should be available from anywhere, at any time through a browser. As a result, the team and the companies will grow smarter and add more value every day as they refine and reuse their knowledge.

As companies work together, they generate mountains of unstructured information that is tough to synthesize in one company and seemingly impossible to rationalize between multiple companies. But new enterprise collaboration technology makes this possible. Desktop and intranet search and data mining solutions now allow companies to utilize more and more of the knowledge that most enterprise systems simply leave untapped in information archives.

Collaboration is the key

Expand your horizons, by expanding the borders of your company through collaboration. The question is – who can your company collaborate with? The answer is relatively simple: your best suppliers, and your best customers. Collaboration increases revenues and profits for all the participants.

Industry experts and businesses that have implemented collaborative techniques claim that collaboration is a key enabler, allowing companies to react more quickly to changes in supply and demand. In the next few years your enterprise will be collaborative, or it won’t exist at all.

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Copyright 2006 : Jim Pinto, San Diego, CA, USA