Competition has been a core tenet of the modern business system but, increasingly, is giving way to its inverse: collaboration. It’s a rational CEO response to the dawning realisation that the best talent is probably not inside your organisation, nor the best decision-makers on your board, or in your management team.
In an illuminating Ted talk Don Tapscott retells the story of his neighbour. He owned a gold mine with one problem: he couldn’t find where the gold was. Or rather his geology department couldn’t find it, so he took the very unusual step of publishing their research online and offering a half a million dollar prize to anyone who could use it to tell him where the gold was hiding. The prize was quickly claimed - not by another team of geologists but a computer graphics firm that built a 3D map of the mine to help it look for the gold. They found $3bln worth of it.
According to the KPMG’s recent Global CEO Outlook 58 percent of leaders now see such “partnerships or collaborative arrangements with other firms” as a way to drive shareholder value. Yet this comes at a time when we are evolving away from the ‘internet era’ - where organisations built relationships with others - to a ‘social media age’ - where people build relationships on platforms directly with other. In the emerging collaborative paradigm ‘platform-less’ organisations are increasingly superfluous to a process where cars are shared through Uber, accommodation through AirBnB, content on Facebook and funding on various crowdfunding site.
Traditional organisations have lost control of key relationships. Such disruption is uppermost in the minds of CEOs. Eighty-eight percent are concerned about “the loyalty of their customers and 82 percent about the relevance of their products and services.” For, while a lot of lip-serve was paid to customer-centricity over the past decade, very few organisations restructured internally away from pushingproducts down these new, segmented channels. The lack of authenticity in many an organisation’s claim of customer-centricity has left many with dangerously-skewed visions of what their customers really want. For example, the mess Renault made communicating with its female audience at a new car launch showed (see insert).
“Renault sent 30,000 amicable, anonymous letters to their female clients in the Netherlands. A handwritten letter that started with ‘Hey darling’ and signed with ‘Love, M.’ suggested that it was a personal note from a friend. [The result was] four hundred direct complaints from ladies to the brand itself, including twenty-five women who took their complaints to the Advertising Code Committee.
Renault explained: “The idea of the campaign was that one friend is writing to the other and includes some news about her new car. It wasn’t intended to offend women or cause them problems in their relationships. But [we now accept] that the request to have a drink soon from a suggestive sender gave a lot of women the wrong impression” (Peter Plevier, press chief Renault Netherlands). Renault sent 30,000 personal letters of apology and while it didn’t, ultimately, harm the brand it made Renault realise that women want to be addressed in a different way.” (‘What women want: Exploring quantitative patterns underlying qualitative stories’. Jansen & van der Borg (2009)
Customer loyalty requires building authentic relationships, based on listening and mutual trust. Feedback loops free of delay and distortion are needed to pick up the signals amongst the noise when customers hit your value chain so you can quickly act upon them. It’s arguably this collaboration that will differentiate the leaders from the also rans in the ‘collaborative economy’.