Collaborative Innovation Challenges- Valutrics

Collaborative innovation concerns the actions that are promoted
and encouraged as a consequence of satisfactory partnership activi-
ties such as joint working and common initiatives. It is this aspect of
a good relationship that is most often thought of as a hard working
partnership. This is the ‘engine house’ of success, but without coaxing
and encouragement, partnerships often stall and fail to spark. Colla-
borative innovation can be thought of as the effectiveness of the
relationship as it produces tangible outcomes such as share of wallet,
growth and scale/frequency of joint projects and bids. Collaborative
innovation enables partnerships to achieve their fundamental aims
and objectives.
‘Working together’ or ‘teamwork’ is a fundamental requirement of
an effective partnership and because cooperation, coordination and
collaboration are closely related they can be grouped together as ‘C3
behaviour’. This is working together to bring diverse resources into a
required relationship to achieve effective operations in harmony with
the strategies and objectives of the parties involved. The importance
of pursuing mutually beneficial interests cannot be underrated but
it also emphasizes the essentially cooperative nature of partnerships
characterized by balance and harmony. Under these conditions
positive feedback ‘kicks in’ and productive relationships can often
lead to the discovery of even more successful ways to cooperate and
new objects of cooperation. In other words, good behaviour will be
reciprocated and a success spiral is possible and accelerated.
C3 behaviour can be used to achieve honed processes, structures,
skills and innovation. In a product-oriented approach, buyers and
sellers join together to innovate and produce competitive, quality
products, and are able to contain or restrict costs for as long as
possible. In the supply chain the early involvement of the supplier’s
expertise in the design phase will bring about significant joint bene-
fits. C3 behaviour is thus an essential factor in contributing to the
practical success of business-to-business relationships. It signifies joint
endeavours to achieve common objectives and hence relationship success. It enables creative, innovative solutions to be developed
that generate new value, products or processes and, in the end,
create a very powerful, intangible value in the form of ‘collaborative
advantage’.

Table   shows a summary of the main components of partnership
quality.

Another important component of collaborative innovation is
the partnership’s ability to adapt to changing internal and external
circumstances. Products, procedures, inventory management, atti-
tudes, values and goals may all need to change to maintain the com-
petitiveness of the alliance. Such changes will be impacted by the type
and complexity of the product/service, the depth of information
exchanged and the extent of organizational social and operational
contacts and degree of cooperation required. A flexible commercial
framework is a sound enabler of adaptation because it gets people
to concentrate on outputs and the customer rather than the ‘small
print’. It is a well-known truism that penalty clauses never create
customer satisfaction.
Communication follows on from and is a requirement of a success-
ful working partnership and thus follows the behavior spirals
model. It is in many ways the enabler for all collaborative innovation
activities. It contains honest, open channels for joint planning and
goal setting where mutual expectations are established and measured
and allows the breadth and depth of the complex interaction to be
managed. At the operational level, clear guidelines on the sharing
of proprietary information and technology positively influence pro-
duct development, costs, sales and revenues. They also increase com-
mitment and trust. Overall, the degree of transparency achieved
in a partnership or alliance will inevitably set the scene for success.

To understand the benefits of collaborative innovation it is appro-
priate to consider some typical situations where it is obviously not
working. These mainly concern the management of operations:
– Responsibilities are shirked.
– Information is not shared effectively.
– Pockets of understanding – the ‘inner circle’ mentality.
– ‘Intellectual snooping’ – information is informally collected by a
partner.
– Focus is on the product rather than the solution for the customer.
– Account managers become ‘problem solvers’ or ‘query managers’.
– Large numbers of transactional, low value or infrequent selling
cycles.
– Basic process disconnects, eg internal processes are used to
manage external partners.
– Lack of proactivity with over-reliance on the host to initiate activi-
ties and come up with ideas.
– Customers are ‘mis-sold’ products.
– There is a lack of strategic selling skills, which results in product-
benefits being dominant in marketing and sales activities.
– Falling customer satisfaction as the appropriate behaviours are
not displayed by a partner.
– Recruitment of partners is difficult.
– Dedicated partner managers have multiple conflicting account-
abilities.
– Planning workshops are dominated by business reviews.
– Joint planning sessions are task/target cascades.