Collaboration, Alliances and Mash-ups

In 1945, if you were called a collaborator in France, you would most likely be lynched. Today, if you are labeled a collaborator, you may get an award.

So what is collaboration? It is not teamwork. Collaboration involves a more diverse cast. Members come from different organizations, have their own agendas and collaborate cause is the best way of achieving their goal.

Cracking the collaboration code

Our ancestors top the food chain because they discovered “mutual interest” ? they remain prey if they act individually but become top predator if they band together. Individuals become a tribe to fend off predators and hunt prey that outweighs each of them by 100 times.

There are lessons here:

?  The discovery of mutual interest is difficult because we are primed to look after our self-interest first and this closes our minds to other possibilities.

?  Discovering mutual interest is most often stimulated by a crisis (being prey) and/or huge opportunity (king of the food chain).

?  The benefits of mutual interest trump self-interest - collaboration divides the tasks and multiplies the chances of success and greater rewards.

Collaboration = Alliances = Mash- ups

Collaboration amongst companies has evolved quite a bit. According to the Economic Intelligence Unit (EIU), companies are increasingly adopting more fluid and agile alliances. Why? Create new value to existing assets, build new capabilities and have a shield against disruptive forces.

Earnest & Young's Digital Deal Economy Study reveals that a third of non-technology executives plan to create alliances and partnerships in the next 2-3 years. And there is a term for these alliances -industrial mash-ups. In an industrial mash-up, a company shares an asset or capability with one or more partners in a way that creates new possibilities for all. These mash-ups are not slowed down by legalities protocol of M&A and JVs because they operate under simple collaboration agreements aimed at finding mutual benefits through effective sharing of resources. Financial terms and synergy targets are often absent from the agreements.

Apple: A Master Collaborator

Since the introduction of the iPod, Apple has built a track record of collaborating with everyone and anyone to get the job done. 

Steve Jobs knew that the MP3 player on its own had little value. The product needed music management software (iTunes), a retail hub (iTunes Music Store) and the introduction of broadband. In short, Apple was selling a brand new way of selecting, buying and listening to music that consumers would find delightful. Bringing this together required both internal and external collaboration with Toshiba, PortaPlayer, Pixo and Wolfson Microelectronics. 

Over the years Apple sharpens collaboration to an art form. The alliance between Apple and IBM is a fine example. Apple's consumer knowledge and IBM's relationships with IT departments of companies offer opportunities to create a capability currently neither possess.

In June this year, Tim Cook announced that IKEA is working with Apple to demonstrate products at home with AR. IKEA’s app would bring 3D models of furniture products and enable customers to sample how a piece of furniture would look in their home and how well it fits the existing decor.

One final and most unlikely alliance- Apple and Samsung. They are the fiercest of competitors in the smartphone sector. But WSJ reported that strong sales of the newest iPhone model, expected later this year, could benefit Samsung. The Korean company will supply flexible displays, called organic light-emitting diodes, to at least one version of the new phone. This is in addition to the memory chips it supplies to Apple, which contributes just a shade below 5% to Samsung's operating profit. So while Samsung and Apple are arch rivals, their relationship is actually one of mutual benefit right now.

"According to data from the Billboard Hot 100, collaborations now represent more than a third of hit songs (see chart). Of the top ten songs on the current Hot 100 chart, half are credited to more than one artist.

Bruno Mars’s “That’s What I Like”, which was named the song of the year at the 60th annual Grammy awards on January 28th, credits no fewer than eight songwriters!" (link - https://lnkd.in/fG_wiAz )

Lesson? You can try and be good at everything. But the superior strategy is to collaborate, form alliances.

So is collaboration right for your company? It becomes seriously attractive when speed for collaboration is important - it is quicker and a less costly solution then M&A or JVs; and if you have significantly under-utilizes assets (EY study estimates that you can boost asset utilization by 50% or more). Another way of deciding to collaborate or not to collaborate is to ask the converse question- when should you not collaborate? Answer: When you do not want to solve complex problems, acquire critical capability and you have no competitors.

The reality is in a VUCA world the case for collaboration just got stronger. Stay out of the game if you wish but know the risk you are taking when you are not collaborating and the opportunities you are passing up. 

#collaboration #teamwork #alliances