What are the big benefits of collaboration for businesses?

In today's fast-moving economy, being able to work effectively with different departments and business partners is essential.

by Adam Gale
Last Updated: 09 May 2018

It sounds like a no-brainer. Surely we need to collaborate in business. In fact, surely collaboration is the very essence of what business is. Name one thing that’s made a material difference to your firm that was entirely the result of one person acting in isolation. You’re likely to struggle.

This doesn’t just apply within your own business, but increasingly between them. As Mike Straw, CEO of change consultancy Achieve Breakthrough, told MT, ‘organisations need to find ways of genuinely collaborating if they are to thrive, because in our rapidly-evolving, tech-driven world, no one has the capacity or expertise to do anything themselves anymore.’

Of course, some organisations are more collaborative than others, and they reap enormous benefits as a result. Better communication, stronger relationships within and between teams, a culture that allows ideas to flow in all directions rather than only from the top down – all of these are hallmarks of world class companies.

Internally, one of the biggest benefits is around employee engagement. Put simply, collaboration requires that workers are actively involved, not merely commanded. Their opinions are respected and their ideas are listened to.

The result is that in a collaborative organisation, employees want to come to work. This makes them more productive, less likely to leave and more likely to recommend working there. Not only does this mean you’ll have better access to talent, you’ll get more out of the talent you already have. As management thinker Professor Isaac Getz puts it, ‘it’s better to have 300 brains than one.’

A collaborative organisation is also much better able to expand, particularly over diverse geographical regions. Effective communication becomes much more difficult at a distance but, without it, expansion risks creating offices that don’t just pull in the same direction.

Then there’s the matter of collaboration between companies. In today’s fast moving economy, opportunities and threats often arise faster than our ability to respond. One way forward thinking companies have mitigated this challenge is to develop their ecosystem.

Often involving smaller start-ups and scale-ups, this is an interconnected network of business partners bringing a whole new range of skills to the table. When it works well, it opens up the best of both worlds – the capability of big businesses and the agility of smaller firms –making the whole greater than the sum of its parts.

It’s the classic network effect, and as Professor Marshall Van Alstyne from Boston University puts it, ‘you cannot scale network effects inside the firm as easily as outside the firm.’

To achieve these network effects, you need a deeply ingrained culture of collaboration. Without the ability to adapt to working with companies that operate in wildly different ways, and above all without trust, this powerful opportunity will always be out of reach. 

At MT and Microsoft’s Collaboration: Make it Work event, we asked a panel of experts how they believed effective collaboration improved made better business. Here’s what they had to say:

Image credit: Chinaview/Shutterstock

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