Why Collaborating Is So Important For Innovation

A few ideas to share with the University of Ballarat Technology Park (UBTP) and Ballarat IT Specialist

(BITS) Breakfast of ICT professionals and other stakeholders from Ballarat and the broader region.

Collaboration is important for innovation and ultimately the creation of wealth

Russell Yardley21 July 20091 © 2009 Algonquin Investments Pty Ltd

Agenda

How do small businesses create wealth? New forms of organisation are emerging

because of the Web Collaborating to link people and

knowledge will impact all businesses Collaboration drives value creation and

ultimately wealth

21 July 20092 © 2009 Algonquin Investments Pty Ltd

Creating Wealth

21 July 2009© 2009 Algonquin Investments Pty Ltd3

Wealth comes from value created by our commercial activitieso Depends on confidence in the economyo Reliability of receipt of the benefits earned

(role of corruption/antisocial behaviour)

o Fairness in the results (pay scales – pay for performance???)

o How we see ourselves and others (stories/anecdotes)

How do small businesses create wealth?o They provide better value through specialisation

Continuous improvement/innovation Importance of productivity Demanding sophisticated suppliers and customers (Michael Porter)

o They build trust with suppliers/customers which lowers costs and creates new opportunities

o They know when to compete and when to collaborateo A business’ reputation for trust and specialisation grows their

businessAnimal Spirits by G A Akerlof & R J Shiller


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Co-ordination Co-operation CollaborationCo-ordinationo Driven by directiveo Focus on short term goalso Teamwork helps but not

essentialo Value created by individual

actiono Little additional valueo Trust not essential to

success

Co-operationo Driven by an immediate needo Can succeed even if

commitmentuneven

o Value is incremental & uneven

o Only one party may benefito Lower level of trust than for

collaboration

Collaborationo Driven by mutual self interesto Requires high level of

commitment on both sideso Creates new value o Value can be shared by both

partieso Often requires specialisationo Requires high levels of trust

Increasing levels of trust


Collaboration: What is it?

• It’s about creating capacity and capability in small groups of SMEs by combining their specialisations to achieve exceptional results

• It’s about each share of the rewards from these results being more valuable than those from solo endeavours

• The complex collaborative enterprise works because each SME is honed to do what it does best and is driven to meet its obligations to the group

• It is in each member’s interest to ensure that their fellow members are capable and do perform at the highest possible level

• It becomes self evident that all members should share resources and opportunities to maximise the enterprises rewards

Creating Wealth - Specialisation


Acumentum Instructional design (EBI - 1994) Interactive design (vic.gov -1997) Web application development

(ScenarioBuilder 2003) Lessons “Core” and “Enabling” skills The world catches up very quickly Internal trust is critical as you grow Executive leadership must be able to judge quality of all strategically

important specialisations of the business Value actually delivered must be valued by customers

New Forms of Organisations Emerging


New forms of organisation are emerging because of the Web Web 0.0 linking the technologists Web 1.0 linking information pages Web 2.0 linking people Web 3.0 linking knowledge

Film Production Company No Longer Major Studios Talent and rewards Skills, technology for pre & post production Who owns what?

Spielberg (Close Encounters) & George Lucas (Star Wars)

Networks/Alliances/Consortia What works best What drives most innovation What creates the most value for most stakeholders Who controls the essential ingredients

Knowledge in Context of People


Linking people and knowledge will impact all businesses The freelancer The Start-up Small business Business networks Large business

Reputation Management A record of what you have done and repeatedly

done with others Not what others say about you but its what

others have repeatedly done with you

Call a Friend (that you may not have met yet)


Someone out there knows what you need to know

Collaboration drivesOpportunities Identifies best skills and knowledgeMaximises your return on investment

Back at the Office Do you truly understand the real value you

provide your customers and that value which your suppliers provide you?

What is essential to that value and what could others do better than you to make you even better?

Can you create a better form of organisation to increase the value you provide your customers?


Let’s Keep this Conversation Going

Website: www.RussellYardley.comTwitter: rmyardley

LinkedIN: www.linkedin.com/in/russellyardley

Email: [email protected]
