From Theory to Practice

Global leaders place a high value on collaborative partnering, but most leaders have not yet made it operational. Some of the obstacles to collaboration are external – including government and other legal restrictions. But the greatest barriers are workforce issues, limiting funding, and (most of all) unsupportive corporate cultures.

Here’s how to get started:

Bring in the customer. Despite the demonstrated benefits of working closely with customers to drive sales, improve product innovation, and better match supply with demand, a recent study by Deloitte found that only 3% to 8% of respondents are actually engaging their customers in this manner. If your company is not already collaborating with customers for innovative product/services development, this is the place to begin.

LEGO Factory has been around for a while, but it remains an inspiring example of how to tap the creativity in a customer base. Children and other building enthusiasts visiting the site are invited to design models (using easy to use, free downloadable software) and take part in competitions for LEGO prizes. A popular contest last year entitled winners to have their model produced and featured in Shop@Home, receiving a 5% royalty on each set sold.

Make suppliers part of the solution. As part of Chrysler’s SCORE (Supplier Cost-Reduction Effort), there is shared responsibility for innovative ideas to get cheaper parts. The goal for each supplier is cost-cutting opportunities that equate to 5% of its annual billings to Chrysler. The collaborative program has generated a flood of more than 100 ideas per week and an estimated savings of $2.5 billion.

Partner with the competition. Collaboration among competitors is the most difficult and delicate form of partnership. But archrivals Procter & Gamble and Clorox have managed to make it work. The two packaged goods companies compete fiercely in the cleaning products and water purification categories, yet both profited when Press'nSeal, a new plastic wrap based on breakthrough P&G technology, went to market under Clorox's well-established Glad brand. And the collaboration continues with the recent introduction of Glad ForceFlex trash bags, which are made of strong but stretchable plastic developed by P&G.

Choose the right people. The best collaborative projects are often those in which the team members can let go of their own (sometimes entrenched) views and ideas, and apply a more open style of working with others. Because collaboration is built on a foundation of good working relationships and trust between individuals, personal qualities (good communicators, good relationship builders, flexible, culturally and politically savvy, confident without being arrogant) are often more important than subject matter expertise. Experts can be brought in as a resource to the process, whereas key interpersonal skills are what keep the collaborative venture on track.

With the constant pressures on resources and the ever-rising expectations of stakeholders, going it alone is no longer the most viable option for an organization. And, in reality, every organization exists within it own unique ecosystem of cross-organizational networks. Collaborative innovation is just one way of expanding and capitalizing on those networks so that they create a competitive advantage.