Creativity Central [Marty Baker]

I am a serious collaboration junkie. 

Unfortunately, not all collaborations are created equal. Often the value of the collaboration is undermined by the time expended, the loss of focus on core projects and the sometimes deleterious effects on interpersonal relationships within an organization.

So there’s a Catch-22 of overselling collaboration as a positive solution to innovation and business growth. 

In my experience, many collaborative efforts are short circuited by lack of relevant training. Often, experts in various areas of a business, haven't had the time to work on collaborative skills.  I have witnessed this myself in organizations where a task force is created and personal agendas, not group goals guide the meetings.

That’s why I was pleased to come across Morten Hansen, a professor at the University of California.  Hansen was a professor at Harvard Business School and at INSEAD, France, where he retains a part-time role. He holds a Ph.D. in Business Administration from the Graduate School of Business at Stanford University.

In his recent book, Collaboration, he takes aim at what many leaders inherently know: in today's competitive environment, company-wide collaboration is an imperative for successful strategy execution, yet the sought-after synergies are rarely, if ever, realized.

Conventional wisdom is that the benefits of collaboration are significant.  But according to Hansen, this wisdom is based on the assumption that the more employees collaborate, the better off the company will be. 

“I’ve seen it happen many times during my 15 years of research in this area.  In one instance, Martine Hass, of Wharton and I studied more than 100 experienced sales teams at a large IT consulting firm.  Facing fierce competition from such rivals as IBM and Accenture for contacts that might be worth $50 million or more, teams putting together sales proposals would often seek advice from other teams with expertise in, say a technology being implemented by the prospective client.

Our research yielded a surprising conclusion about this seemingly sensible practice. The greater the collaboration (measured by hours of help a team received) the worse the result (measured by success in winning contracts.) We ultimately determined that experienced teams didn’t learn as much from their peers as they thought they did.  And whatever marginal knowledge they did was often outweighed by the time taken away from their work on the proposal.”

Hansen says that the problem wasn’t collaboration per se, rather the problem was determining when it makes sense and, crucially when it doesn’t. “Too often a business leader asks, how can we get people to collaborate more? That’s the wrong question. It should be, will collaboration on this project create or destroy value?”

To distinguish between effective and ineffective collaboration, Hansen recommends estimating the factors below.

Return: What cash flow would this collaboration generate if executed well?

Opportunity costs.  What cash flow would we pass up by investing in this project instead of a non-collaborative one?

Collaboration costs.  What cash flow would we lose owing to problems associated with cross-unit work? 

Would the return exceed the combined costs of opportunity and collaboration costs? Initiate a collaboration project only if the answer is yes.

Hansen’s insights are the inevitable thermostat effect – the balancing effect of an idea (collaboration) that can sometimes be counterproductive in a variety of situations.

There are so many positive stories of successful collaborations, so Hansen’s book is good cautionary advice.  It’s a reminder that collaboration has to be managed and evaluated as well and as purposely as other areas of an organization.

Thanks to the Harvard Business Review (April 2009) and Morten Hansen for quotable material.