Collaboration is a powerful business tool for companies, regardless of their size or industry. It typically refers to organisations working together to address problems and achieve goals that seem to be out of reach when working alone.
By combining the effort and expertise of different organisations, all partners in the network are better able to innovate and grow, and increase their competitiveness on many levels.
Business collaboration benefits
Key benefits of business collaboration fall under several categories:
- Financial benefits - for example, the ability to boost domestic or export sales, to tender for larger contracts or cut costs by sharing resources.
- Human capital - for example, the ability to develop employees' skills and capabilities, safeguard jobs, increase employment and encourage staff motivation.
- Physical capital - for example, the ability to share facilities, resources, equipment and raw materials.
- Intellectual capital - for example, the ability to tap into combined expertise, knowledge and capabilities.
Business networks may provide member companies with access to resources that would otherwise be beyond the scope of a single business. Individual businesses can face a number of limitations when trying to compete in global markets. This may include scale and expertise.
Through collaboration, businesses can often complement each other and specialise in different areas to compete in markets usually beyond their individual reach. See what makes a successful business collaboration.
Collaboration vs competition
In collaborative working, communication and information sharing between partners is essential. However, this doesn't mean that it requires you to give up all your business 'know-how'.
Collaboration can take many forms and you can build a network in a way that allows companies to complement each other without risking their market share or intellectual property. Read about the different types of business collaboration.