Creating Collaborative Ecosystems

Effective collaboration is difficult, it requires fostering the right environment for people to share ideas and engage in debate, the right attitude to assure customers, vendors, or partners the effort is worthwhile, and commitment to overcome challenges that are bound to arise during the execution of a project or operation of a business. However, these activities are essential for growth and competitiveness over the long-term.

Visualizing a Collaborative Ecosystem

You can visualize a collaborative ecosystem with its essential components and each respective purpose to be similar to an anatomy. The anatomy of a well-functioning collaborative ecosystem can be visualized as having three main components that work together in harmony: external partners, internal supporting functions, and the company's core competencies.

Working in unison, this anatomy of diverse external inputs, strong internal connectivity, and focused strategic core allows companies to swiftly sense, adapt, and respond to their environment. It powers innovation and growth.

Anatomy of a Collaborative Ecosystem

The skeleton provides structure and support - this is the company's core competencies in key areas like business strategy, product development, leadership vision, advanced technologies, and investment priorities. Just like a skeleton enables a body's movement and flow, the core competencies align the collaborative efforts.

  • Business

    The business unit owns the P&L and operations while focusing on acquisition and revenue.

    Product

    Product owns the product requirements and features while focusing on activation, retention and referrals.

    Leadership

    Leadership must define the mission and purpose for the company, decides the priorities, and is ultimately responsible for outcomes.

    Technology

    Technology is responsible for the engineering requirements to execute the business or product goals, as well as both maintenance and innovation of infrastructure.

    Investment

    Investment must source and secure opportunities to meet strategic or financial objectives.

The muscular system provides strength, connection and movement - this is the internal supporting functions like business development, strategic partnerships, open innovation teams, and relationship managers that facilitate collaborations between different parts of the ecosystem. Just like muscles connect bones and power movement in a body, these functions broker deals and drive collaboration.

  • Business Development

    Identifies a clear path forward and builds consensus horizontally and vertically to achieve new growth.

    Strategic Partnership

    Manages or creates key accounts that present complementary objectives in multiple verticals.

    Open Innovation

    Works with sourcing partners to identify startups or teams for pilots or strategic investment.

The sensory organs provide inputs and information - these are the external parties like customers, vendors, strategic alliances, and other collaborators. Just like sensory organs provide essential inputs and signals to the brain, the external partners feed insights, knowledge and opportunities back into the company via the internal supporting functions.

  • Customers

    Customers can be B2B, B2C, B2B2C… these are the end users of your product or service.

    Vendors

    Vendors are supplying you with goods, equipment, or services that are essential for your success.

    Partners

    Partners are non-competitive entities who stand to gain from collaboration but not necessarily through a direct transaction.

The Joys and Sorrows of Collaborative Innovation

Building the Right Framework

The Anatomy of a Collaborative Ecosystem is fairly straightforward, but in reality many organizations face challenges implementing this for a variety of reasons. Many companies are too small to imagine how to navigate this even if they see the value, other companies may be large enough to have implement this framework but struggle with internal politics, legacy, or inertia.

Thinking about how to implement building a collaborative organization in a way that best fits you is the first step to success. Some functions could overlap or even be replicated more than once, core competencies could overlap as well or be added.

The objective is to build processes around the goal of improving how information moves across the organization to identify needs and fulfill them in a more effective manner that achieves innovation and growth.

Being Overwhelmed

There can be an overwhelming number of objectives in an organization attempting to address a number of internal or external needs.

It is important to overcome these through effective communication, alignment, and managing expectations.

Clear Pathways Forward

From a high-level it is possible to set clear goals for core competencies and support functions and ensure effective cross-organizational collaboration.

It is important to clear these pathways together to make sure each group is aligned to maximize speed and effectiveness.

Identifying Opportunities

There are two distinct approaches for identifying opportunities each with distinct rationales and benefits. Depending on your objectives it will makes sense to implement one or both of these to achieve your goals.

Casting a Wide Net is analogous to a fisherman lowering a net into the sea to capture a variety of fish. This approach can help us learn new technologies and adapt to market changes, and it can return unexpected or even outsized rewards. However, there is a degree of risk and it requires the ability to build a pipeline of good opportunities, evaluate and eventually commercialize them.

Hunting Whales is akin to being a skilled harpooner with a specific target in mind, usually a key player in an industry. There could be multiple synergies, but first you must pierce the organization with a clearly defined focus in order to build a working relationship. The challenge here is having a clearly defined value proposition, strong negotiation skills, and the capacity to navigate a complex organization.

Execution

Determining objectives that balance the need to leverage internal assets while also fulfilling the need for new capabilities is a critical activity that requires analysis and reflection.

Inside-out objectives originate from within the organization, reflecting its existing capabilities and assets. These tend to be more incremental innovations building on current competencies. Outside-in objectives come from understanding customer needs, industry trends, and the external environment. They point to more disruptive innovations requiring new capabilities.

Innovation execution requires velocity, which has two components: force and direction. Force represents the level of resources and inputs devoted, like time, budget, and human capital. Increased force is necessary but not sufficient alone. Direction gives focus and prioritization to different types of innovation projects. Efforts could be focused on partnerships to access new capabilities, greenfield internal ventures that create net new offerings, or acquisitions to obtain external innovations and talent.

Assessing the organization's appetite for risk and tolerance for failure guides force and direction trade-offs. Higher risk innovations require more force to increase chances of success. The innovation portfolio should consist of a mix of incremental and disruptive projects across different time horizons. Mastering velocity is critical to maximizing returns on innovation investments.

Moving innovations rapidly through Learn-Validate-Deliver cycles provides momentum and confidence across Start, Grow, and Scale phases of a lifecycle.

With a robust innovation practice, failures in Start and Grow phases are expected and accepted. Patience and commitment are needed to sustain innovation velocity over multi-year horizons to reach Scale.

Innovations in the Start phase should be given more latitude to learn and pivot. The priority is learning through failure quickly and cheaply. Investments are smaller and outcomes less certain. In the Grow phase, expectations move towards establishing repeatable early traction. There is greater focus on refining the product and business model. In the Scale phase, expectations converge on commercial success and integration with existing operations. Leaders should not expect innovations to scale before demonstrating viability and sustainability.