Just about every study on innovation identifies the power of collaboration and communities as one of the major forces driving innovation in today's environment. For example, in our own such studies in IBM, a major conclusion of the 2004 Global Innovation Outlook (GIO1.0) was that innovation is increasingly collaborative and open, as more and more, it results from people working together in new and integrated ways. Specifically, the report noted that ". . . close cooperation across an ecosystem will stimulate new business designs, as companies redefine what they do and what they rely on others to do." The GIO 2.0 report which came out earlier this year identified the power of networks, i.e., communities, as one of its top findings, as individuals told us that increasingly "their power comes largely from their ability to tap into and sometimes transform a larger network of people and ideas."
Similarly, in the 2006 CEO study that was released this past March one of the key themes that emerged from the CEO interviews was that external collaboration is indispensable for innovation, with customers and business partners cited as top sources of innovative ideas. In today's fast-moving and highly competitive world, more and more businesses recognize that there exist a lot more capabilities for innovation in the marketplace than they could try to create on their own, no matter how big and powerful the company.
While CEO's told us that collaboration is absolutely critical, they also told us that partnering, whether crossing internal or external boundaries is easy in principle but very difficult in practice. This is not at all surprising. Working with different groups to achieve common objectives usually requires a change in the culture of most organizations - and cultural transformations are arguably the hardest of all. Deep down, to truly embrace a culture of collaboration requires a certain degree of humility in an individual, group or company, that is, an acceptance of limitations in ones ability to get things done without help, which then makes it emotionally easier to reach out and work effectively with others.
This is much easier said than done, especially in a society as focused on "winning" as is ours in the US. We like to use sports metaphors when discussing competition in the marketplace, and our business vocabulary is infused with all kinds of sports and martial terms, starting with our notions of "winners" and "losers." We use such terms even as we know that the world of business is much more complex than the artificial world in which sports teams compete, and that the time frame in which a business has to prove its excellence is much longer that the typical sports season.
Collaboration and humility are particularly important for those companies that like IBM are addressing problems in business, government, health care, technology and science that are very sophisticated in nature and are pushing the envelope in what is possible. You cannot work on such problems - say information based medicine, integrated supply chains or advanced engineering design - unless you have established a very close relationship with your clients, business partners, and even other vendors that might very well be competitors. In such an environment, to boast about being "the best" would frankly be considered crass, a sign of corporate insecurity rather than the strength of a confident leader. Instead, you want to be known as a company that helps all the various members of the team succeed in whatever problems are being addressed. Rather than claiming that you are the most innovative of companies, you want to be known as a company that helps those that you work with become more innovative themselves.
In the end, a company can only be as innovative as the collective capacity of the people in the organization, and clearly, that requires attracting top talent. In today's highly competitive business environment, a company cannot attract and retain the top talent it needs unless such people feel that they are respected as individuals and professionals, which increasingly means that in addition to their work in the business, they are involved in activities as part of communities. GIO 2.0 participants observed that "innovation in business and society is fueled by the unifying notion of 'the endeavor' - activities driven by a common set of interests, goals or values." We see that for example with the rise of open communities, social networks, online discussions or "jams", as well as the collaboration that is such an integral part of the world of research, whether your discipline is physics, medicine, history or law.
In such an environment, a business needs to not only attract top talent, but it needs to trust them and encourage them to collaborate and innovate with colleagues within and outside the business, driven as much by pride of contribution as by loyalty to the company. For companies used to hierarchic organizations and strategies driven down from the top, this management style is not easy at all. It requires that the company and its top managers accept the fact that they don't have all the answers, and that in today's fast changing and complex world such answers are best found with their own people, their business partners, their customers, researchers in universities and government labs and so on. Often, the way people get inspired and come up with new ideas will be through their interactions with colleagues within and outside the business, and consequently, the humble - and wise - corporation does everything possible to encourage such community interactions.
For collaborative innovation to become part of the DNA of a company, its culture must embrace a set of seeming paradoxes. It must be both aggressive and self-conscious, both prideful and humble, both confident and second-guessing. Without abandoning its competitive spirit -- indeed, while enhancing it -- the company must truly accept the notion that the way to make progress and solve problems is to work as a team and tap into the collective knowledge of the team. In fact, such a culture of collaboration often enables the company to better compete in the marketplace in those areas in which it chooses to do so. The wise corporation recognizes that a major element of business strategy in the 21st century is to achieve the proper balance of proprietary and collaborative innovation.
This is really difficult, but doable, as IBM's own experience attests. For example, we have simultaneously accelerated our creation of intellectual property -- evident in 13 years-and-counting as the top U.S. patent earner -- while deeply embracing the open source movement and the spread of open standards. In other words, we're holding in our heads at the same time notions of profiting-from-ownership and profiting-from-collaboration. I'm convinced that those companies that make a similar transition will increasingly attract the most talented people, the best partners, and in the end - the most loyal customers.