Hack:
Dude, where's my Team gone?

By Stephen Remedios - Partner and Associate Director, People Strategy at Boston Consulting Group

October 30, 2011 at 7:16pm

collaboration

open innovation

social enterprise

Humane Finance

Pharmaceutical Industry

Moonshots

Capture the advantages of diversity

Retool management for an open and borderless world

Transcend traditional management trade-offs

Summary

The world has changed. The problems that could be solved by Edison, Lister & Einstein have all been solved. Today's world needs collaboration of the best, not competition among the best. Unfortunately the game isn't set up that way!

Problem

Today's commerce is driven by corporates looking to outperform each other. When that is the superordinate goal, there is very little chance of anyone coming together to collaborate. Every pharma company is pouring billions into research to find the cocktail that will cure AIDS, they are all competing with each other for the brightest talent. That approach unfortunately is no longer yielding the results that it should. In the past, innovation and success was based on the desire to bring a positive change to manking. When Bell invented the telephone, making money was the last thing on his mind. Edison, The Wright Brothers and Joseph Lister were driven to achieve excellence and to change the lives of million, not by the need to shore up a sagging share price.

You just have to take a walk in a retail store to see how shallow 'innovation' has become today. There are hundreds of shampoos with me-too claims like '4X longer' or '2X stronger' etc. That's what you get when you are looking to manage the next 90 days. This however is the result of cut throat competiton for pretty much everything that you can ever buy from a retail store.

It is critical that we solve this problem because we all live in an increasingly connected world that's beginning to see the ill-effects of unabashed capitalism and the relentless pursuit of supernormal profits. There isn't much time for the best to come together and start to focus innovation and research on the real issues rather than pouring billions into research on the next tooth whitening molecule.

Solution

The solution lies in our past. Whenever there has been an emergency, teams have come together and produced magic. When our existence and future hangs in the balance, competition vanishes and collaboration assumes centerstage. Countries that have never seen eye to eye have collaborated in the face of a common enemy.

Indeed, the greatest example of collaboration to democratize the availability of information and knowledge has to be Wikipedia. Today, a 10 year old can research the subject of global warming at the click of a button and arrive at a well considered view. 10 years ago, this would be unthinkable. One might have had to spend a sizeable amount on an encyclopedia or consider buying Microsoft's Encarta.

This language of collaboration needs to be spoken more widely and on more important matters. Consider research in the pharmaceutical industry. Wouldn't it make more financial, business and human sense to have all the major companies collaborate to invent a cure for AIDS or cancer rather than have them take each other on in a race to the patent office so that they can make billions in profit over the next few decades.

Unprecedented collaboration, and not in the collusive price fixing sense, it the need of the hour. Food companies muct collaborate to democratize food processing technology so that every starving child in Africa can get a square meal. Food fortification research must be democratized so that no child ever dies of malnutritiion again.

Practical Impact

Consider all the major pharma companies sending their foremost researchers to a modern day equivalent of Lockheed Martin's Advanced Development Program, more famously known as Skunk Works, with a mandate to develop of cure for AIDS or Cancer in a year. That would significantly increase the chances of finding a cure.

All companies would then own the cure and should rightly be able to price it at a more affordable rate then they would have been able to had they needed to fund the entire research budget independently. Equally important, is the speed with which the drug would have been available across the entire world if all of them were to combine the power of their distribution in order to maximize the number of lives their drugs might save.

There is a significant change in attitude required on the part of corporations and the shareholders invested in them. The value of a corporation has to shift for pure financial measures to a more holistic consideration of what it brings to humanity. Shareholders have to show faith in making investment decisions that aren't based solely on the short term. A temporary hit in profit margins should be lauded by the stock market if it makes an innovation more widely available and more easily accessible.

First Steps

To kick-start collaboration of a level that is hitherto unthought of would require a captain of industry to put humanity before profits and take a stand. It could also begin with the coming together of three or four large companies to tackle a problem that each have been unable to solve for a protracted spell of time.

This isn't altogether unrealistic given that large companies work together on certain trade and legislative forums to ensure that the industry isn't taxed unduly etc. The recognition that greater good is served by a more wide ranging collaboration is what will make all the difference.

As a starting point a couple of organizations could agree to trade their top performing executives in a particular field so that both organizations could raise the floor. Imagine the benefits if the best of Toyota's manufacturing were to be shared with the GE, and GE's leadership development processed were to be shared with more MNCs.

Credits

Lynda Gratton

The members of the Future of Work Consortium

Hindustan Unilever

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November 2, 2011 at 10:25pm

Gautam Mahanti

It is said that rubbing the belly of the 'Laughing Buddha' brings in wealth. Buddha is laughing because he is thinking, " silly it's not competition but co-operation which will bring in health, wealth and happiness". Unfortunately it's our conditioning which doesn't allow us to collaborate. Until the realization comes that it's no longer a pyramid and that there is enough room at the top, change is difficult to come by. Good post, Steve

November 17, 2011 at 11:11am

Katherine Laumas

There is a vast array of information out there but gathering and sharing information with the right people can be a challenge. Not everyone has access to the same information. In the end one cannot simply do it alone, there needs to be some form of collaboration. But competition and money are barriers of entry into information collaboration. In order for us to be able to innovate on larger scales teams should be formed. However, collaboration will take a long time to occur and this probably won’t happen till a crisis occurs and egos are set aside.

November 17, 2011 at 11:19am

Efrain Perez

If this were possible greater things would occur. So many people in this world that have insight, knowledge and the know how to create or develop life changing products if given the opportunity. If there were cross collaboration amongst companies, there would be greater return on their investments and more economic resources for humanitarian efforts. However, you point out key challenges that have been instilled since a very young age that will be difficult to change, since monetary rewards is what a majority of the world seeks for themselves not for the world.

November 17, 2011 at 3:19pm

Joseph Lynch

This is a very valid point considering the push towards open innovation and transparency; however this does not fully accept the reality of competition or probabilities in problem solving. There are many situations where open collaboration helps fuel and improve the process; but it is not wise to discount the strength of individual teams competing. As the example pointed towards pharma in this hack, we should not that not all people are receptive to the same drugs. I support open collaboration because it invites public discussion and think melt but can also lead to certain ideas being squashed or discarded. There should be approach that could involve both.

November 17, 2011 at 3:22pm

Dewey Tieu

I think you have the right idea. However, I am not sure about its practicality. The idea of cooperate while compete has been the trend among the Fortune 100 companies in recent years. Many companies call it “coopetition”. Companies such as IBM, Cisco, Microsoft and Oracle on many fronts are competing directly against each other; however, they do still collaborate to ensure what each company produces serves the needs of the end user. I don’t agree with you, however, that the earlier innovators did not mind about making money when they set out to invent something. Similar to what I don’t believe that Steve Jobs did not think about making money when he envisioned the future of entertainment and music in early 2000's. In a market economy, competition offers choices to consumers. The process of finding a cure for certain disease might be lengthy when companies compete, however the end result is 5 different drugs that cure the same disease and 1 of which I am not allergic to. It’s tough luck if all the best and brightest from all the big pharmas came together and found one cure for cancer when its active ingredient will kill me.

November 17, 2011 at 4:33pm

Tapaswinee Das

Points mentioned are well taken. It seems though the focus is more on the marketing and earning aspects of it, and undermining the market competition in lieu of collaboration.

Inter company collaboration is a good idea - but it is not panacea for all inefficiencies. When companies work together in a fair market, they need to make sure they are getting their fair share of their efforts. Legal contracts in a collaborative setting is difficult to carve out and manage. Some partnerships may also work sometimes. In the absence of a stronger player, like federal government, they generally fall apart. Transaction costs involved in maintaining partnerships are much higher. Companies in strategic tie-ups or legal contracts cannot move faster to the changing world demands, decision making is often delayed.

Wall street analysts reward companies who perform or gather resources which will help them perform in future and penalizes companies who do not. Having such free markets and market participants encourages competition and keep the CEO's on their toes. Market competition and fairness is essential to motivate companies to move for the (long term) problems. I view the government / world policies play a much larger role compared to market’s role in nurturing collaboration.

Generally, partnerships / collaborations make sense while treading an uncharted territories - when finding a radical cure or a space exploration. Often, research begins with collaboration - and collaboration projects between industry and universities are very much still in place.