01.08.13
‘Collaboration’ is a fundamental business discipline
Source: Public Sector Executive July/Aug 2013
David Hawkins, operations director at the Institute for Collaborative Working (ICW), discusses the growing importance of collaborative working, BS 11000, and the broader context in which the ICW works.
The recent BSI publication of the ‘Construction Strategy 2025’ shows a clear direction for increased collaboration between government and industry.
Earlier this year the Bank of America survey for the 2013 Davos economic forum highlighted the views of CEOs from across the globe that the way out of the economic crisis was through collaboration. Interestingly, the ICW research paper ‘Future Connections’, published in 2005, offered the view that by 2020 business models would be based more on partnerships, collaborations and alliances.
In 2010, the US National Intelligence Council’s annual report focused on interdependence and, more recently, the theme of collaboration is coming back into the vocabulary – including in the ‘Value for Money’ report published by Sir Roy McNulty on the UK rail industry.
Skills and training
So is government contracting, or for that matter broader industry, adopting these concepts to address economic and budgetary pressures? And if so, do we have the skills to make it happen?
Whilst there are some examples of imaginative collaborative initiatives, it is probably fair to say that the trend remains traditional top-down pressure on price rather than working collaboratively to find innovative solutions that deliver sustainable cost reduction and growth.
It is understandable, given the economic situation of recent years, that some effort had to be directed to stemming the flow of government spending – but these short-term measures can only provide a respite. Historically, squeezing prices delivers limited impact. What is also evident is that these traditional approaches simply condition the market to respond accordingly. The longer term solution has to be working with industry rather than working on industry – recognising that this requires change on both sides and, more importantly, the recognition and development to change behaviours and close the skills gap.
A new vision
The world is changing. The last decade has witnessed a dramatic change in business models, driven by economic pressures and the demands of the market.
The expansion of global networks, supply chain resilience, increased complexity and risk surrounding customer requirements has added significant weight to the adage that ‘no man is an island’. Perhaps even more pertinent: neither is any organisation in today’s environment.
Henry Ford saw his vision as one based on total ownership, from raw materials through supply and customer service. Today this model is both expensive and difficult to maintain, as well as frequently too inflexible to meet the challenges of the 21st century.
The continued quest for a competitive edge has led to the growth of extended global supply chains, outsourcing, alliances, partnerships and integrated delivery models, which brings into question traditional business skills based on command and control.
Collaboration is not new; in fact, it is perhaps the oldest of all trading models, reaching back to the traders who built the ancient civilisations. In the middle ages artisans combined their skills based in good faith to produce a variety of tools and products.
They had skills and intuition that would be valued today but have to a large extent been lost as we have progressively moved towards relying on legal solutions.
Moving away from command and control
So collaboration is back in the front line but it raises the question as to whether government and industry have recognised this shift, and more importantly the skills needed to develop and build these extended enterprises.
The ICW research suggested that (other than isolated programmes within universities and business schools) the main thrust for the next generation of managers remained based on exploitation and command and control models.
It was this research that prompted the Institute to start working with the British Standards Institution to develop BS 11000, the world’s first standard for collaborative business relationships, based on good practice.
It provides guidelines for organisations to integrate collaboration to drive the behaviours and culture necessary for success. Relationships are a crucial aspect of good working culture and the traditional perspective that collaboration is a person to person issue needs to be challenged.
Certainly in recent years, some forward looking organisations have taken up this challenge and two such examples offer a perspective on how this alternative thinking can be developed.
EMCOR
EMCOR, a highly successful facilities management company, recognised that simply providing clients with external replacements for in-house staff meant competition was simply about cost not value.
They embarked on a programme to reshape their business model. Working with Cranfield University they have developed and integrated a Key Account Management programme focused on customer engagement and value creation under the banner of ‘making our customer’s life easier’.
This was a significant investment and to some extent risky, since structuring your business in this way can mean losing out with clients that do not appreciate the value. It certainly does not seem to have harmed their business, but did mean a greater focus on relationship skills in additional to technical capability.
Network Rail
Network Rail took a similar view but from a customer perspective initiated a programme to optimise the costs of investment and maintenance, supported by the McNulty report, which recognised that the only way to reduce operating costs was to implement a more collaborative approach with industry.
It worked more closely with its supply chain to introduce early contractor engagement to reduce risk, improve planning, reduce duplication of resources and boost incentivisation.
Collaboration was essential. Network Rail’s investment in recruitment, training and skills development is ongoing and it is working with ICW, Warwick University and others to build this collaborative approach into its current and future management teams.
Both these organisations, along with others, have already adopted BS 11000 as core operating practices.
Early assessments agree that a structured approach to collaboration removes the risk of relying purely on personal relationships, though these remain a factor.
It has changed the dialogue from conflict to value creation.
The future
Looking to the future, embedding collaboration creates a platform for consistency and repeatability, which in turn speeds engagement, reduces risk, shortens programmes and improves costs, whilst enhanced customer satisfaction prolongs relationships and provides better business.
Given these examples (and there are many more) it poses the question: is it time to consider collaborative skills as a fundamental business discipline?
Can governments and for that matter industry continue to assume that people will work effectively together when historical evidence suggests that in many cases this is not the reality?
And, perhaps more importantly, do the operating processes actually support collaborative approaches?
We must consider recognising experience and developing individuals’ skills to work with these dynamic business models, and at the same time evaluate organisational structures to provide an opportunity to deploy the skills when collaboration is appropriate.
In this context a national standard provides a common framework against which to move forward on both fronts.
About the author
David E. Hawkins FCIPS has had an extensive career in projects and procurement within the construction industry, and over the past decade has been an active promoter of partnering concepts and the development of extended enterprises through the building of alliances.
He was the architect and author of the CRAFT collaborative methodology and technical author of the British Standards Institution (BSI) PAS 11000 framework, the world’s first collaborative business relationship standard, and chairman of the BSI committee that developed the BS 11000 standard. In 2009 he was acknowledged as one of the world’s top 100 thought leaders on corporate social responsibility.