The current economic climate continues to challenge businesses across the UK, particularly in the manufacturing and engineering sectors. However, one way in which companies have enhanced their productivity is by diversifying. In order to do this, there has been a noticeable increase in collaborative working – particularly through online business to business marketplaces – with organisations from different areas of expertise coming together to make an impact in new markets with innovative products, services and applications.
Working in partnership with another organisation brings with it a unique set of challenges for companies of all sizes, particularly for smaller, owner managed businesses that may not have worked so closely with another commercial enterprise before, and are used to taking the lead and being in sole control of all projects.
Although collaboration introduces a range of challenges, when these are overcome, it can provide a wealth of new opportunities to businesses looking for new direction and focus that would simply be unavailable to a company working on its own.
Working in collaboration with one or more partners requires careful planning, robust communication channels and the willingness to be flexible – in the new age of online collaboration, speed may seem to be of the essence but, as The Boston Consultancy Group highlights, traditional rules of business success still apply. "Three factors, in particular, can substantially increase a marketplace’s chances of success: a sound business model, committed founding partners, and a businesslike approach to managing the enterprise."
However, before we even get to thinking about how a successful collaboration works in practice, the first step is to ensure you are working with the right partner.
A collaborative project will often arise when a company is looking to tap into a new market sector. While the experience and reputation of the company you are working with is important, this is really just a hygiene factor. Compatibility is equally as important as competency, and businesses should be careful to see if they have the right chemistry with their selected partner before leaping into a project. Ensuring that both parties have visited each others’ premises and introducing the day-to-day teams to one another is crucial in determining if the pairing is going to work.
While a lot of work may have already gone into identifying the best partner on paper, it’s okay to walk away at this stage if there is a clash of cultures, rather than get involved in a partnership that will cause further problems – at worst, litigation – further down the line.
Working with more than one partner brings a set of practical challenges and in the planning stages careful attention should be paid to how each party can align their processes for successful day to day working. This is particularly true in terms of project management – it should be decided in the early stages who will take responsibility for this, as without central direction it can be easy for projects to lose direction, ultimately resulting in potential opportunities lost.
Another vital aspect of collaborative working frequently overlooked is the need for effective marketing. Rather than a silo approach, with each party promoting the project independently, a co-ordinated approach will pay dividends. Often issues of funding need to be addressed, as well as ensuring that each partner, and the collaboration itself, achieve the appropriate balance of publicity.
The Advanced Business Development Network (ABDN) is a cluster group of 18 independent engineering-based SMEs in the West Midlands. The companies within the group; including the lead partner, Malthouse Engineering; collaborate to attract large contracts, complementing each other with varying skills and resources, providing services including steel profiling, CNC machining, presswork, welded assemblies, fabrication and powder coating amongst others.
In a highly competitive global market, the ABDN wanted to ensure that they were in a position to take advantage of the available opportunities that their collaborative approach presented. They did this by drawing on support from a high-calibre graduate and university expertise through a Knowledge Transfer Partnership (KTP) managed by the University of Wolverhampton.
Mark Hayward, a graduate with a First Class Honours degree in Marketing Management, joined the network as a KTP Associate to develop and implement collaborative business and marketing strategies to promote the network.
The resulting redesign of the ABDN website and accompanying Google Adwords campaign has generated over £750,000 of potential new business to date. Mark was also responsible for bringing the content management system for the website back ‘in-house’ enabling the network to react quickly to change – leading to savings in both time and money. Other notable successes include a company acquisition and the formation of the UK’s sole manufacturer of log debarkers; Cundey Systems Ltd.
The strength of the collaboration has not gone unrecognised – it was nominated for a Lord Stafford Award in the Open Collaboration category reaching the final stage, and was highly commended and won a CISCO award for Innovation in Digital Marketing.
The ABDN clearly demonstrates that effective collaborative working is much more than bringing together a group of companies. With the potential for greater capacity allowing for fulfilment of larger orders, a broader market offering, shared knowledge and access to greater procurement opportunities, the benefits are there for the taking with the right approach.