Collaboration

1. Collaboration is a Means, Not an End

Leaders who pursue disciplined collaboration never lose sight of this dictum: collaboration is a means to an end, and that end is great performance.

Collaboration for Results. The core principle of disciplined collaboration is that it should always serve a higher purpose: achieving better outcomes. Collaboration isn't valuable in itself; it's a tool to drive innovation, increase sales, improve operations, or achieve other strategic goals. Leaders must instill this mindset throughout the organization, ensuring that people don't collaborate for the sake of collaborating but rather to achieve tangible results.

Avoid Collaboration Traps. Many companies fall into collaboration traps, such as overcollaborating, overestimating potential value, underestimating costs, misdiagnosing problems, or implementing the wrong solutions. These traps lead to bad collaboration, characterized by high friction and a poor focus on results. Smart leaders avoid these traps by having a framework that helps them clearly see the difference between good and bad collaboration.

Disciplined Collaboration Framework. Disciplined collaboration involves properly assessing when to collaborate (and when not to) and instilling in people both the willingness and the ability to collaborate when required. This approach helps organizations avoid the pitfalls of undisciplined collaboration and ensures that collaboration efforts are aligned with strategic objectives. It's about making collaboration a strategic choice, not a default behavior.

2. Assess the Upside: Innovation, Sales, and Operations

Companies differ in how much value they can create from innovating, selling, and improving operations based on collaboration.

Three Areas of Potential Upside. Collaboration can drive significant value in three key areas: innovation, sales, and operations. Better innovation happens when people from different areas come together to create new ideas and develop exciting products. Better sales occur through cross-selling and bundling products into solutions. Better operations result from cost savings and improved decision-making through the transfer of best practices.

Collaboration Matrix. To evaluate the potential upside, leaders can use a collaboration matrix to assess opportunities between pairs of business units. This systematic approach helps pinpoint where collaboration can create value and where it's unlikely to be beneficial. The matrix reveals opportunities for cross-selling, joint product development, or shared services, providing a clear picture of the potential benefits.

Avoid Over- or Undershooting. It's crucial to avoid both overestimating and underestimating the potential value of collaboration. Overshooting can lead to wasted resources and unmet expectations, while undershooting can result in missed opportunities. Leaders must carefully calibrate the potential upside in their company, considering the specific context and capabilities of each business unit.

3. Collaboration Premium: The Go/No-Go Decision

Managers must carefully estimate opportunity and collaboration costs and clearly say “No, we will not collaborate” if the collaboration premium is negative, foreshadowing a loss.

Collaboration Premium Defined. The collaboration premium is the net value of a collaboration project, calculated as the return on the project minus both opportunity costs and collaboration costs. Opportunity cost is the value of the best alternative use of resources, while collaboration costs are the extra hassles of working across units.

Opportunity Costs. Leaders must consider what else could be done with the time, effort, and resources going into a collaboration project. There may be better uses of people’s time and effort—projects with better returns altogether. The opportunity cost is the net cash flow that organizations forego by doing the collaboration project instead of something else.

Collaboration Costs. Collaboration costs refer to the extra hassles of working across units and their consequences: extra time traveling, time spent haggling with the other parties over objectives, efforts to solve conflicts, and all the poor results that these complications create: delays, budget overruns, poor quality, and lost sales. Collaboration cost is the negative cash flow that results from all these factors.

4. Four Barriers to Effective Collaboration

All four barriers need to be low before effective collaboration can really take place.

Four Key Barriers. Effective collaboration is often hindered by four key barriers: the not-invented-here barrier (unwillingness to reach out), the hoarding barrier (unwillingness to provide help), the search barrier (inability to find what's needed), and the transfer barrier (inability to work with unfamiliar people). These barriers can significantly impede information sharing, knowledge transfer, and joint problem-solving.

Not-Invented-Here Barrier. This barrier arises when people are unwilling to reach beyond their own units to get input and collaborate. This can stem from an insular culture, status gaps, self-reliance, or fear of revealing shortcomings. Overcoming this barrier requires fostering a culture of openness and valuing external input.

Hoarding Barrier. The hoarding barrier occurs when people are unwilling to share their knowledge, information, time, and effort with others. This can be driven by competition, narrow incentives, being too busy, or fear of losing power. Addressing this barrier involves aligning incentives, promoting a culture of sharing, and recognizing the value of collaboration.

5. Unify People with Shared Goals and Values

Leaders who create a compelling unifying goal, infuse a core value of teamwork, and talk the talk of collaboration inspire unity, allowing people to see the whole and not just their part.

Unifying Goals. Creating a unifying goal is a powerful way to bring people together and foster collaboration. A compelling unifying goal should create a common fate, be simple and concrete, stir passion, and put competition on the outside. Examples include Kennedy's "man on the moon" goal and Airbus's "beat Boeing" objective.

Core Value of Teamwork. Instilling a core value of teamwork is essential for promoting collaboration. Leaders must articulate the value of teamwork, demonstrate it in their own behavior, and avoid the pitfalls of small-team focus and making teamwork the sole purpose. Teamwork should be seen as a means to better results, not an end in itself.

Language of Collaboration. The language a leader uses can significantly shape behavior. By consistently speaking the language of collaboration, leaders can signal its importance and encourage people to work together. This involves using words and phrases that emphasize shared goals, mutual support, and collective success.

6. Cultivate T-Shaped Managers: Performance and Collaboration

The problem with Rob Parson is that he is a lone star.

T-Shaped Management Defined. T-shaped managers excel in two dimensions: delivering results in their own job (the vertical part of the "T") and delivering results by collaborating across the company (the horizontal part of the "T"). They are willing to reach out and ask for input and also to help others when asked. They are disciplined enough to say "no" to collaboration when it doesn't produce value.

Reject Lone Stars and Butterflies. Leaders should avoid promoting lone stars (high individual performers who don't collaborate) and butterflies (institutional players who don't perform well in their own jobs). Instead, they should focus on cultivating T-shaped managers who can balance individual achievement with collaborative contributions.

Two-Sided Performance Management. To cultivate T-shaped behaviors, leaders need to implement two-sided performance management, rewarding people for both individual results and contributions to other units. This involves setting clear criteria, collecting data, evaluating performance, and using promotions and compensation to reinforce T-shaped management.

7. Build Nimble Networks: Connect, Don't Bloat

Collaborative companies run on networks, those informal working relationships among people that cut across formal lines of reporting.

Networks for Opportunity and Value. Networks are essential for identifying opportunities and capturing value. They help people find resources, expertise, and collaboration partners, and they facilitate the transfer of knowledge and best practices. However, it's crucial to build nimble networks that are effective and don't waste people's time.

Six Network Rules. Six network rules help people identify opportunities and capture value: build outward, not inward; build diversity, not size; build weak ties, not strong; use bridges, don't use familiar faces; swarm the target, don't go it alone; and switch to strong ties, don't rely on the weak. These rules help create networks that are both efficient and effective.

Companywide Network Management. Leaders need to actively manage companywide networks by mapping the network, evaluating its effectiveness against the six rules, and tailoring interventions to address specific weaknesses. This involves identifying isolated units, promoting diversity, cultivating bridges, and encouraging the formation of strong ties when needed.

8. Collaborative Leaders Redefine Success

Collaborative leaders redefine success and focus on goals bigger than their own narrow agendas.

Beyond Personal Agendas. Collaborative leaders prioritize the goals of the organization over their own personal ambitions. They are willing to compromise, seek common ground, and focus on achieving broader objectives. This requires a shift in mindset from individual achievement to collective success.

Robert Ulrich Example. Robert Ulrich, the former CEO of Target, exemplifies this behavior. He prioritized the company's success over his own personal recognition, remaining publicity-shy and focusing on building a strong organization that would thrive beyond his tenure.

Seeking Common Ground. Collaborative leaders actively seek common ground among people with different goals and agendas. They are skilled at finding areas of agreement and building consensus, even in the face of conflicting interests. This requires empathy, active listening, and a willingness to compromise.

9. Involve Others: Inclusive Decision-Making

Collaborative leaders involve others in decision making and exhibit an open mind—to alternatives, divergent views, dialogue, and working with others.

Openness to People, Alternatives, and Debate. Inclusive leaders create a decision-making process that is open to diverse perspectives, alternative viewpoints, and constructive debate. They value input from others and create a safe environment for people to express their opinions. This approach leads to better decisions and greater buy-in.

Kennedy's Inclusive Approach. President John F. Kennedy's handling of the Cuban Missile Crisis provides a powerful example of inclusive decision-making. He involved a diverse group of advisors, encouraged open debate, and created subgroups to explore different alternatives. This process led to a more informed and effective response.

Decisiveness is Key. While inclusiveness is important, collaborative leaders must also be decisive. They make the final decision after considering all input and move forward with a clear plan of action. This balance of inclusiveness and decisiveness is essential for effective leadership.

10. Collaborative Leaders Embrace Accountability

Collaborative leaders hold themselves accountable, and they also demand accountability from others.

Individual Accountability. Collaborative leaders hold themselves accountable, even though collaborative work often leads to a diffusion of responsibility. They take ownership of their actions and results, regardless of the circumstances. This sets a strong example for others and reinforces the importance of individual responsibility.

Holding Others Accountable. Collaborative leaders also demand that others be held accountable for their contributions. This involves setting clear expectations, providing feedback, and addressing performance issues. It's important to distinguish between holding people accountable and simply blaming them for mistakes.

Carlos Ghosn Example. Carlos Ghosn, the former CEO of Nissan, exemplified this behavior by publicly committing to specific targets and holding himself and his entire executive committee accountable for achieving them. This created a culture of responsibility and drove significant improvements in the company's performance.

Last updated: February 25, 2025