Companies aren’t just using collaboration to share information and promote innovation. These days, two companies can band together to expand market share and business opportunities.
During the past decade, executives have grown increasingly aware of the importance of collaboration to increase workforce productivity, improve customer service and even drive innovation. Social media tools and other technologies have been a major factor, revolutionizing how people work together and share information.
But what happens when collaboration extends beyond an organization to other companies, partners, suppliers or even competitors?
That is the larger trend today. More companies are deciding not to go solo when it comes to competing in today’s markets. But how to collaborate beyond one organization’s four walls — and deal with the impacts on business models, leadership, culture, learning and a host of other issues — is a challenge. Redefining the Business
In one respect, cross-enterprise collaboration is nothing new. Supply chain partnerships have been in place in many industries for a long time. In sectors such as electronics, consumer goods and aeronautics, companies may have more than a hundred partners working across manufacturing and delivery. But in other cases, cooperative business models go well beyond what companies have traditionally meant by supply chain partnerships or even alliances.
Consider the case of Endo Pharmaceuticals in the United States and Orion Corp. in Finland, which are collaborating in the oncology drug market. The companies intend to co-develop products, share development costs and pay each other royalties based on sales in their respective territories.
Cross-enterprise collaborations have the potential to redefine the nature of competition and cooperation. Companies may compete aggressively in one part of the world or business and still cooperate in others.
Different types of companies also can entwine themselves in each other’s value chains. Have a Toshiba laptop in need of repair? UPS will pick it up as always. But now UPS runs Toshiba’s repair business, too, and will have the laptop repaired and back to a customer within a few days. It’s all in the name of efficiency and streamlining turnaround time.
To succeed in this coming era of cross-enterprise collaboration, companies will need to manage relationships across company boundaries as effectively as they do within those boundaries. Success, in other words, involves far more than how contracts are established, marketing is managed and work handoffs are documented. What’s needed is coordinated attention to a range of talent management and human capital strategy issues, including the following: