Of course, we know what we’re doing!

“Collaboration is where firms enter into buyer-seller relationships, supply chain partnerships, services marketing arrangements or any other relationship combination. They will work together using their specialised resources innovatively to achieve aims and objectives that they could not realise on their own.”

 However, in practice there are a variety of relationship types out there and collaboration is only one of them. Business is usually grouped in sectors where they know the field and each other. Relationships often develop over time but commonly, managers lose track of where their relationships fit in this line up, whether they are over, under or correctly managing them. They may be missing opportunities because they are managing at the wrong level. It’s very good practice to track this picture regularly for all your relationships.

 There are four broad categories:

Arms-length – cheapest off the shelf products and services e.g., stationery supplies

Co-ordination – repeat purchases, regular deliveries and some limited extras e.g., small events catering.

Cooperation – customer/supplier arrangements with long-term contracts, variable requirements and regular contact between the organisations e.g., office cleaning and maintenance.

Collaboration –strategic alliances or joint projects involving team working and innovation within a flexible contract e.g., new product or market development partnership.

 Basically, you choose which ever fits your purpose but, you only ‘pick’ collaboration for the most strategically important relationships where the increased cost and complexity of management is justified by the high returns. You should also note that working collaboratively needs a significant change in attitude because it runs against the grain of competitive business behaviour.

 “We are working towards a partnership/collaborative relationship but 'currents' within both companies are suspicious of the trend.”

Project Director, Global Construction Design Company