BUSI 1604 – Foundation of Scholarship and Research
Business Collaboration – A new strategy to success
Is business collaboration, rather than market competition, becoming the key to success? Discuss in relation to two Sectors.
Table of Contents
The business value of collaboration
Collaboration is a joint effort and well-defined relationship entered into by two or more organizations to accomplish a task or project. Successful collaboration is defined as “a win/win arrangement that is likely to provide improved business success for both parties”. (McClellan, 2002, p20). Organizations are coming up with different, innovative strategy to sustain in the market. Organizations are entering into collaborative strategies to gain more profit and be more efficient. Gary Hamel (1989), states the “keep your friends close, but your enemies closer”, which in this context tells us that collaboration is always better then competition as it encourages meaningful relationships, creativity and vulnerability. Collaboration is nothing new, however it is becoming increasingly important in the modern world. The major contributor to this shift is movement of businesses to cross cultural geographies, in order to expand and learn from other organizations. Current competitive business trend which involves shrinking order to product cycle, need of intensive R&D and constant product development, companies are joining hands with the competitors to lower the cost with optimum utilization and profits. The organization nowadays are consolidating to reduce overcapacity, and are working to reduce the time and cost to produce a new product to market. Over the years, collaboration has shown several benefits for manufacturers, suppliers and customers. These benefits include remarkable cost reductions, enhanced service, improved end-customer satisfaction, shorter lead times, improved information clarity, increased competitiveness and a clearer division of responsibility among partners (Akintoye et al., 2000). In developing new technologies and products, collaboration helps to increase technological diversity and combine complementary resources of rival firms. Having said that, to achieve these results the relationship requires a high level of commitment and goal oriented vision. In this paper, let’s see how collaboration has become a market trend in the growing sectors of information technology and automotive industry to overcome the challenges and have a successful business in the world. The business value of collaboration
Study reveals that technology is changing the way IT industries operate. Industries in the world have realized that business process automation improves its efficiency and effectiveness. This change in the thought process of business strategy has literally made the information technology industry a back bone of the current business world. Industries often require knowledge from beyond organizations boundaries in order to overcome the existing technological base and shape new dynamics (Burgelman, 1983). IT Industry faces challenges that are unique and are different in their own prospect. For example the technological challenges that today’s IT industry face is shorter product lifecycle, innovative technologies and increasing R&D and capital expenditures. These serve as important drivers in IT industries to engage in collaboration. As the product life cycle are dramatically shrinking (Chen and Li, 1999, Devi, R Gnyawali 2011) due to briskly changing customer preference. Technological convergence provides both risks and opportunities to firms, which leads to collaboration. Convergence increases risks and uncertainty about market and technology and pushes firms to reach out other entities, including competitors, to...
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