Why Collaborating Is So Important For Innovation

Collaboration is important for innovation and ultimately the creation of wealth A few ideas to share with the University of Ballarat Technology Park (UBTP) and Ballarat IT Specialist (BITS) Breakfast of ICT professionals and other stakeholders from Ballarat and the broader region. Russell Yardley 1 © 2009 Algonquin Investments Pty Ltd 21 July 2009

Agenda  How do small businesses create wealth?  New for ms of organisation are emerging because of the Web  Collaborating to link people and knowledge will impact all businesses  Collaboration dr ives value creation and ultimately wealth 2 © 2009 Algonquin Investments Pty Ltd 21 July 2009

Creating Wealth  Wealth comes from value created by our commercial activities o Depends on confidence in the economy o Reliability of receipt of the benefits earned (role of corruption/antisocial behaviour) o Fairness in the results (pay scales – pay for performance???) o How we see ourselves and others (stories/anecdotes)  How do small businesses create wealth? o They provide better value through specialisation  Continuous improvement/innovation  Importance of productivity  Demanding sophisticated suppliers and customers (Michael Porter) o They build trust with suppliers/customers which lowers costs and creates new opportunities o They know when to compete and when to collaborate o A business’ reputation for trust and specialisation grows their business Animal Spirits by G A Akerlof & R J Shiller 3 © 2009 Algonquin Investments Pty Ltd 21 July 2009

Co-ordination Co-operation Collaboration Co-ordination Co-operation Collaboration o Driven by directive oDriven by an immediate need oDriven by mutual self interest o Focus on short term goals oCan succeed even if oRequires high level of o Teamwork helps but not commitment commitment on both sides essential uneven oCreates new value o Value created by individual oValue is incremental & uneven oValue can be shared by both action oOnly one party may benefit parties o Little additional value oLower level of trust than for oOften requires specialisation o Trust not essential to collaboration oRequires high levels of trust success Increasing levels of trust 5 © 2009 Algonquin Investments Pty Ltd 21 July 2009

• It’s about creating capacity and capability in small groups of SMEs by combining their specialisations to achieve exceptional results • It’s about each share of the rewards from these results being more valuable than those from solo endeavours • The complex collaborative enterprise works because each SME is honed Collaboration: What is it? to do what it does best and is driven to meet its obligations to the group • It is in each member’s interest to ensure that their fellow members are capable and do perform at the highest possible level • It becomes self evident that all members should share resources and opportunities to maximise the enterprises rewards 6 © 2009 Algonquin Investments Pty Ltd 21 July 2009

Creating Wealth - Specialisation  Acumentum  Instructional design (EBI - 1994)  Interactive design (vic.gov -1997)  Web application development (ScenarioBuilder 2003)  Lessons  “Core” and “Enabling” skills  The world catches up very quickly  Internal trust is critical as you grow  Executive leadership must be able to judge quality of all strategically important specialisations of the business  Value actually delivered must be valued by customers 7 © 2009 Algonquin Investments Pty Ltd 21 July 2009

New Forms of Organisations Emerging  New forms of organisation are emerging because of the Web  Web 0.0 linking the technologists  Web 1.0 linking information pages  Web 2.0 linking people  Web 3.0 linking knowledge  Film Production Company No Longer Major Studios  Talent and rewards  Skills, technology for pre & post production  Who owns what? Spielberg (Close Encounters) & George Lucas (Star Wars)  Networks/Alliances/Consortia  What works best  What drives most innovation  What creates the most value for most stakeholders  Who controls the essential ingredients 8 © 2009 Algonquin Investments Pty Ltd 21 July 2009

Knowledge in Context of People  Linking people and knowledge will impact all businesses  The freelancer  The Start-up  Small business  Business networks  Large business  Reputation Management  A record of what you have done and repeatedly done with others  Not what others say about you but its what others have repeatedly done with you 9 © 2009 Algonquin Investments Pty Ltd 21 July 2009

Call a Friend (that you may not have met yet)  Someone out there knows what you need to know  Collaboration drives  Opportunities  Identifies best skills and knowledge  Maximises your return on investment 10 © 2009 Algonquin Investments Pty Ltd 21 July 2009

Back at the Office  Do you truly understand the real value you provide your customers and that value which your suppliers provide you?  What is essential to that value and what could others do better than you to make you even better?  Can you create a better form of organisation to increase the value you provide your customers? 11 © 2009 Algonquin Investments Pty Ltd 21 July 2009

Let’s Keep this Conversation Going Website: www.RussellYardley.com Twitter: rmyardley LinkedIN: www.linkedin.com/in/russellyardley Email: yardley@AlgonquinInvestments.com 12 © 2009 Algonquin Investments Pty Ltd 21 July 2009

Why Collaborating Is So Important For Innovation

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