The Culture of Collaboration

Multicultural Collaboration Produces Unique Spa

Bridging cultures, particularly regional cultures, produces a broader perspective that gives collaborators an edge. In disciplines like aerospace engineering, team members trained in one country’s engineering tradition may view a creative challenge differently than their colleagues who were trained in a different country’s system. Drawing from their collective global knowledge, cross-cultural collaborators can spark synergies and create greater value. In The Culture of Collaboration book, I call this the Dynamic Dimension of Cross-Cultural Collaboration.

This dimension is alive and well at Archimedes Banya, a spa complex that opened in San Francisco last New Year’s Eve after twelve years of development and construction. People from twenty different countries collaborated on the project. Managing partner Mikhail Brodsky of Russia had the original idea. Reinhard Imhof of Switzerland led the indoor construction. Architect Sam Kwong of China developed the plans. Other partners are from countries including Korea, Israel, Germany, Japan, and Mexico.

The concept began when Brodsky, a mathematician, arrived in San Francisco from Moscow in 1989. A lover of Russian bath complexes or banyas, Brodsky was disappointed to find no such facilities in his adopted city. He longed to start a banya. In the summer of 1998, Brodsky, then a professor at the University of California at Berkeley, applied for a job as chair of the mathematics department at San Francisco State University. SFSU’s rejection sparked Brodsky’s interest in doing something significant in San Francisco while delivering on his banya dream.

Brodsky, Imhof and two other partners formed a company, and in 1999 bought a lot in India Basin near San Francisco’s former Hunters Point Shipyard. Though in an obscure neighborhood, the lot provided sweeping views of San Francisco Bay. To construct the building, Brodsky and his partners would need to recruit more partners. Like many ethnic groups living in the United States, many Russians do business only within their community. Therefore, logic would dictate engaging Russians to finance, design and build the project. But some Russians who Brodsky approached had difficulty seeing past the many roadblocks to the project ranging from building permits and location to construction costs and customer base. So, Brodsky decided to broaden his reach, involving people from as many countries as possible. The common thread was a passion for the Banya project plus mutual trust and common goals, two of the Ten Cultural Elements of Collaboration I identify in The Culture of Collaboration book.

In a departure from the command-and-control approach to business in which “stars” grab the credit, Archimedes Banya recognizes multiple contributions in much the same way Adobe Systems includes a credit role in its software products. When I visited Archimedes Banya recently, the first thing I noticed was a wall near the entrance listing the names of the multicultural collaborators who turned the concept into reality. Also apparent was the amazing art ranging from mosaics depicting bathing traditions to murals and inlaid ceiling tiles. Including art in public bathing facilities is a tradition dating back to the Roman Empire.

Artist Vadim Puyandaev of Kazakhstan collaborated with Brodsky to evoke the right atmosphere. “I
wanted very simple, clear images of emotion,” says Brodsky. And the images also reflect action. “In a Russian banya, people move. It’s an active place. It’s not just sitting and sweating.” The complex is geared to socializing and offers facilities ranging from a rooftop sun deck with a San Francisco Bay view to private reception rooms replete with bars and kitchens.

The Banya offers a spa experience reflecting the cultural melting pot. I checked out two Russian saunas, the Finish dry sauna, the steam room, warm soaking pools, cold plunge and relaxation room. After loosening up in the various saunas, I experienced a Russian venika platza treatment that involved a tall Moldovan fellow clad in a towel and sweat-soaked Banya hat brushing and lashing bunches of Latvian birch leaves on me to increase circulation.

Following this, I laid on a table as an attendant scrubbed me with an exfoliating soap and then rinsed me with buckets of warm water. Then my muscles were relaxed enough for a massage from a masseuse from the United States. Afterwards, I headed to the café upstairs for pelmini or Russian dumplings, stuffed cabbage, hearty Russian beef soup, fresh-sqeezed juices spiked with kombucha, which is fermented tea and housemade kvass, a non-alcoholic beer made from fermented rye bread.

An ambitious spa project that began as one person’s vision ultimately reflects the combined vision and execution of multiple people from many cultures. Collaboration involves marrying talents that are worth far more collectively than individually. Brodsky describes himself as a “starter.” But to make the project a reality, he collaborated with Imhof, a “finisher.” Because of the Swiss tradition of quality workmanship, Imhof shared Brodsky’s values of using the best materials and constructing a banya for the long term. The concept of “starters” and “finishers” has broad ramifications. A starter may have an incredible idea, but creating a company that produces substantial value may require collaborating with a finisher.

As we collaborate, we can create awesome value by engaging and involving people with multiple talents and backrounds and, yes, from multiple cultures. The Dynamic Dimension of Cross-Cultural Collaboration delivers results otherwise unattainable.

 

Cross-Sector Collaboration for Sustainable Development

Accomplishing massive goals requires massive collaboration—far beyond collaborating within an organization or within an industry or among government agencies.

Making meaningful progress on issues including eradicating global poverty and protecting the global ecosystem requires collaboration among governments, non-governmental organizations (NGO’s), private industry, farmers, indigenous peoples and unaffiliated individuals with ideas. This cross-sector collaboration is driving the agenda for the United Nations Conference on Sustainable Development which happens this June 20-22 in Rio de Janeiro, Brazil. The conference, dubbed Rio+20, marks the twentieth anniversary of the United Nations Conference on Environment and Development. The 1992 conference established the Rio Declaration, which includes 27 principles mostly addressing sustainable economic development.

Last Friday, at the invitation of the United States Department of State, I attended a planning meeting for Rio+20 at the Center for Social Innovation at the Stanford Graduate School of Business. The purpose was to distill ideas from cross-sector collaborators on how to bridge connection technologies with sustainable development. In a brainstorming session on “sustainable economic growth,” we tackled wasted talent and connectivity.  Think of the many people in developing countries with talent and ideas who have no outlet to connect and collaborate. This is our collective loss as global citizens until we tap that talent.

The world’s wasting of talent in developing countries is analogous to the command-and-control organization that pays “knowledge workers” to think and pays everybody else to carry out orders. See my January 11, 2011 column for BusinessWeek.com on this topic. Such an organization squanders talent. This is because people throughout the organization—from the loading dock to the call center—have knowledge to contribute.

One participant noted that wasted connectivity involves using the Internet frivolously, perhaps for pirating movies and other content, rather than for working together to eradicate poverty, create new markets and protect the environment. Similarly, wasted connectivity within organizations involves using networks and tools for chatter rather than for developing and producing products and services.

Since the 1992 Rio Declaration, the Internet has grown from less than 16 million users to over 2 billion users, according to internetworldstats.com. Mobile phone users have grown from less than 23 million in 1992 to more than 6 billion in 2011, according to nationmaster.com. The current level of connectivity creates an opportunity for a more distributed, peer-to-peer (read inclusive) approach in collaborating for sustainable development. 

Old models of cross-sector collaboration were minimally effective, because they involved “decision makers” or “thought leaders” shaping ideas and developing solutions which they would hand down to people impacted by the decisions. Now people in developing countries without affiliations can shape ideas with ministers and private sector leaders globally. Well, at least this is technically possible.

As important to cross-sector collaboration as global connectivity and enabling technologies is a cultural shift in which governments, NGO’s and private industry embrace input from people regardless of affiliation or location. This is analogous to organizations adopting more collaborative cultures and tools so that people far from the home office or from executive corridors can participate in making decisions. The State Department has chalked up success with an emerging collaborative culture and tools including Secretary Clinton’s Sounding Board. For more on this, see my September 14, 2010 post.

One of the people hashing out ideas in the sustainable development brainstorming session was Rio+20 Secretary General Sha Zukang, who is also the UN Under Secretary General for Economic and Social Affairs. Zukang, who demonstrated particular talent at defining and outlining sustainable development issues, brushed against a live wire as the workshop concluded: intellectual property. The brainstorm was exactly three weeks after the collapse of U.S. House of Representatives support for the Stop Online Privacy Act and Senate support for the PROTECT IP Act backed by media and entertainment companies and opposed by Google and Wikipedia among other online interests.

Zukang described the need to “find a balance” between protecting intellectual property and disseminating information. This balance impacts cross-sector collaboration in that people in developing countries often lack access to the same information accessible to their collaborators in developed countries. Providing affordable access will help level the playing field. Contrary to some viewpoints, collaboration—cross-sector or otherwise—by no means requires eliminating or dismantling intellectual property protection. IP protection creates incentives for people and organizations to collaboratively develop and produce products and services.

Cross-sector collaboration takes collaboration beyond organizational and sector boundaries to create value on a global scale.

BMW, Toyota and Collaborating with Competitors

They compete in the marketplace, but now they’re also collaborating.

BMW and Toyota have announced they will collaborate in two areas: the companies will share costs and knowledge for electric car battery research, and BMW will supply diesel engines to Toyota. Toyota owns the luxury brand, Lexus, and therefore BMW and Toyota directly compete in the luxury car segment. Both companies have a significant collaboration track record.

In The Culture of Collaboration book, I describe how BMW and Toyota create value by collaborating internally and with business partners. The preface, which you can read here, reveals how my visit to the BMW design center in Munich some years ago sparked the book.

So why would two competitors collaborate? Collaborating makes sense within enterprises and with partners, but the marketplace requires pure competition. Right?  Well, that depends.

Collaborating among competitors makes sense when the collaboration:

1. Creates value for both parties
2. Begins with structure and clarity
3. Involves non-differentiating processes

Clearly, the BMW/Toyota collaboration nails number one. “We think that this collaboration will allow for development of next-generation batteries to be done faster and to a higher level,” Toyota Executive Vice President Takeshi Uchiyamada said at a news conference. Both companies will share the costs of battery development. 

Toyota will reportedly use BMW’s 1.6 and 2-liter diesel engines for cars sold in Europe beginning in 2014. This is reportedly the first time Toyota has procured an engine from a competitor. According to a story by Yoshio Takahashi and Kenneth Maxwell in the December 2, 2011 edition of the Wall Street Journal, the collaboration will reduce BMW’s engine production costs per unit by increasing volume. So, value creation is at the heart of this collaboration.

What about #2, structure and clarity? Based on what I know of BMW and Toyota and their approaches to collaboration, chances are this effort involves much of both. In any collaboration among competitors, both parties must establish boundaries for collaboration at the outset. Most importantly, the competing collaborators must determine use and ownership of existing and jointly-created intellectual property. Far fewer problems arise when business unit people, engineers, marketing folks, lawyers and others from both companies hash out these concerns rather than simply handing off the issues to lawyers to hash out in a vacuum.

Regarding #3, I’ve found that collaboration among competitors works best when the effort involves eliminating redundancy in non-differentiating processes. These are typically under-the-hood processes that are not part of a company’s market or product perception.  Two companies that each make hot sauce might use the same bottling equipment. Two newspapers in the same market might use the same printing presses. Entire industries participate in consortiums for purchasing, saving each competing company substantial money. These shared, non-differentiating processes are invisible to the customer. 

Engines are invisible to all but the most die-hard car enthusiasts, so collaborating on this process arguably fits the bill as non-differentiating. Typically, car batteries have nothing to do with the vehicle perception in the marketplace. In the case of electric cars, though, the jury is still out whether the battery is invisible to the consumer. The technology is in its infancy, and therefore the market consists primarily of early adopters. These consumers are more techno-savvy, realize the lithium-ion battery is intrinsic to the product’s technology and performance, and therefore may place a heavier emphasis on the battery in their purchase decisions.

So, it remains to be seen whether battery research and development is non-differentiating for BMW and Toyota. Nevertheless, if both companies can save substantial money on development and bring vehicles to market sooner and customers perceive and actually get better electric vehicles, this collaboration will prove successful.

U.S. Embassy Vatican Gains Influence by Sharing

After delivering a keynote speech for the Tagetik User Conference 2010 in Lucca, Italy late last month, I wanted to experience first-hand the collaborative movement in the United States Department of State.

So, I visited the United States Embassy to the Holy See. With only six diplomats plus local staff, the embassy is undoubtedly one of America’s smallest. Unlike every other U.S. embassy, Embassy Vatican represents the U.S. government not just to a sovereign nation, but also to the largest single organization on Earth. That organization is the Catholic Church and its 1.2 billion Catholics globally.

With a geographically-dispersed constituency, Embassy Vatican requires more than a physical location to accomplish U.S. policy objectives. That’s where virtual or eDiplomacy plays a role. Sure, there are often reasons for U.S. diplomats to press the flesh with Church officials, but Embassy Vatican need not be physically located in the Vatican. And, in fact, it’s not. The embassy is across the Tiber River in Rome, Italy.

To reach the embassy, I made my way to Aventine Hill, an upscale neighborhood of Rome. What distinguishes the villa housing Embassy Vatican from the other mansions on the tree-lined block is the soldiers and small artillery across the street, security at the gate plus metal detectors at the entrance to the building. I waited in a converted living room decorated with portraits of former U.S. ambassadors and pictures of popes with U.S. presidents ranging from Reagan to Obama.

In time, I was shown into an elegant office with a view of the embassy’s lush garden. Julieta Valls Noyes, Deputy Chief of Mission, extended her hand. She then introduced Mark Bakermans, Embassy Vatican’s point person on collaborative tools. After brief pleasantries, Julieta was ready to embrace the informality so necessary to collaboration. “I’ve already greeted you, so I can remove my jacket,” she smiled.

Our conversation focused on the challenges of representing the United States to a global constituency. “We’re a small embassy, but what happens here has universal interest,” according to Julieta. To encourage information exchange and collaboration, Julieta had advocated building a Microsoft SharePoint portal for the embassy. However, according to Julieta, the tiny embassy lacked the necessary bandwidth. So, the State Department’s eDiplomacy team sent people to Rome. In May of 2009, a Diplopedia wiki-based internal site went live. For more on Diplopedia, see my September 14, 2010 post on “Taking Collaborative Risk at the State Department.”

Clearly, Embassy Vatican’s use of Diplopedia is raising the embassy’s profile within the State Department. On an average month, the site gets 300 to 400 visitors. But that number spikes considerably when issues involving the Catholic Church hit the news. As the Catholic Church sex scandal bubbled up to banner headlines last February, Embassy Vatican’s Diplopedia site became a State Department clearinghouse for information on the scandal and the Church’s reaction to it. Most of the staff at Embassy Vatican contributes to the Diplopedia site, but Mark noted that the challenge is getting people across the State Department to comment on posts and share knowledge. For Diplopedia to enhance collaboration, consumers of information must also become contributors to information.

I asked Julieta whether she would provide an inside view of the State Department’s internal ideation tool called Secretary Clinton’s Sounding Board, which is based on a blogging platform. For more on Secretary Clinton’s Sounding Board, see my September 14, 2010 post. Julieta invited me to sit on the edge of her desk (more informality!) as we viewed spirited debate from employees on topics ranging from recruitment of Hispanics to paying interns. Notably, one of the State Department’s most senior officials participated in the discussion and helped shape the ideas.

The State Department has used Secretary Clinton’s Sounding Board to create workplace improvements. These range from installing showers for team members who ride bicycles to installing donation boxes so that employees can deposit left-over foreign currency from trips. The State Department then uses the money to aid families of Department people such as those who were Haiti earthquake victims. Ultimately, the State Department may use the ideation tool to craft diplomacy. Julieta insists that a separate ideation tool for diplomacy hosted on the Department’s classified site makes more sense than integrating diplomacy with workplace issues.

Like so many organizations, the State Department still faces cultural issues that impede collaboration. These include rank-consciousness, unnecessary manifestations of hierarchy and silos among levels, teams and regions. Nevertheless, collaborative culture is starting to take hold—and tools like Diplopedia and Secretary Clinton’s Sounding Board are extending and enhancing that culture.

Breaking Corporate Rules to Collaborate

What happens when team members want to collaborate, but command-and-control approaches and internal competition prevail in culture and processes? New research indicates team members are starting to “spoof the system” by flouting organizational guidelines and creating work-arounds so they can collaborate. The global study conducted by InsightExpress and funded by Cisco surveyed more than two thousand end users and a thousand information technology decision makers from ten countries. The study found that 52 percent of organizations prohibit the use of social media applications and 50 percent of end users admit to ignoring company policies at least once a week. “End users have started to take things into their own hands,” says Alan Cohen, Cisco’s vice president of enterprise solutions.

 

The study found that users most willing to break company policies are those in the United Kingdom and France. Respondents in China were least likely to violate corporate rules. Still, the survey found that companies in China and India had significantly higher adoption rates of collaborative tools than companies in the United States or the United Kingdom. This is likely because companies in these growing economies are relatively new, and therefore their infrastructures are by no means set in stone.

 

Ironically, the study found that 77 percent of IT decision makers plan to increase spending on collaboration tools this year, while team members say corporate policies are constraining collaboration. Investing in collaborative tools makes little sense if an organization lacks the culture and processes to support the tools. The result is a schizophrenic organization in which some team members break rules, others operate by the book, and most team members get confused by mixed messages. Considering the study results, a prime opportunity exists for leaders to think and act collaboratively and for organizations to adopt collaborative culture.

 

Cisco will gladly sell you any and all of its more than 60 collaboration products. But buying these products or those of any other collaboration tools vendor will produce limited results unless your organization makes a fundamental commitment to collaboration. This shift includes moving away from command-and-control, internally-competitive culture and processes and replacing the pass-along, serial approach to work and decision-making with spontaneous, real-time models. I address this in the introduction to The Culture of Collaboration book.

 

Intercompany Collaboration: Focus on Culture and Processes

 

On another note…outmoded culture and processes can curb collaboration and compromise value—whether we’re talking about within a company or “outside the firewall.”  As vendors and standards groups resolve intercompany collaboration technology issues, there’s a temptation to conclude that intercompany collaboration is “good to go.”

 

About three weeks ago, I participated in a discussion via TelePresence with Cisco senior vice presidents Tony Bates and Barry O’Sullivan. The company was discussing details of its new Intercompany Media Engine, which extends unified communications among companies. So, a supplier can easily view the availability or “presence status” of a customer, connect via instant messaging, and easily escalate the interaction to a voice call, web conference, or telepresence. You can view video of a demo call here. Meantime, the Internet Engineering Task Force (IETF) is working on an open standard for telepresence and unified communications so that people can interact regardless of technology vendor. This has particular relevance for business partners with different installed telepresence brands. Ultimately, the challenge for intercompany collaborators goes well beyond the technology. Organizations must focus on adopting collaborative culture and processes and integrating them across organizational boundaries.

Replacing ROI with Return on Collaboration?

Yesterday I had a compelling discussion with Alla Reznik, director of global voice and collaboration for Verizon. Alla is from Russia, and she’s the only U.S.-based marketing professional I know who can provide input on the Russian language edition of The Culture of Collaboration book published by Ecom of Moscow. Alla and I chatted about regional cultural differences in how people collaborate—and differences in how they respond to surveys.

 

It was a timely discussion, because today Verizon and Cisco are releasing a new study tackling return on investment (ROI) for collaboration expenditures. ROI has long frustrated collaboration tools vendors, because of the difficulty in quantifying “soft” benefits such as corporate reputation. The research, conducted by Frost & Sullivan, identifies a model for measuring what it calls return on collaboration (ROC).

 

ROC measures the impact of collaboration on key functional areas. These include research and development, human resources, sales, marketing, investor relations, and public relations. Traditional ROI measures money gained or lost on an investment. In contrast, ROC tracks the amount of “improvement” derived from a financial investment in collaboration. The study identified research and development, sales and marketing as the functional areas with the highest ROC.

 

The study called “Meetings Around the World 2: Charting the Course of Advanced Collaboration” is based on questionnaires completed by 3662 information technology and line-of-business decision makers in 10 countries. Respondents represented enterprises plus small and medium sized businesses. Nearly half the organizations are using unified communications and collaboration tools ranging from enterprise instant messaging to Cisco TelePresence. Among the study’s key findings is that collaboration is more than twice as important as strategic orientation and six times more important than market factors in determining business performance.

 

 

“The world has changed quite a bit since 2006,” according to Alla, who was referring to the 2006 study dubbed “Meetings Around the World 1.” This earlier study determined that collaboration fuels business performance and that collaboration capability is based on technology, culture and structure. The new study indicates that culture and structure are even more important to collaboration than they were in the previous study conducted in 2006.  The point is that collaboration technology makes the most difference in organizations with collaborative cultures and structures. Similarly, the fundamental premise of The Culture of Collaboration book is that maximizing time, talent and tools to create value requires collaborative culture.

 

The main purpose of the study is to convince business decision makers to invest in collaboration tools and technologies.  One conclusion is that a $1 million investment in collaboration tools and technologies will deliver a $4 million dollar “improvement.” However, this result apparently fails to consider whether the organization has adopted a collaborative culture. I would argue that a $1 million investment by an organization with a collaborative culture will produce greater results than the same investment by an organization with a command-and-control, internally-competitive culture. So while the study does highlight the role of culture and structure, more work is necessary in integrating these elements into measuring ROC.

 

The big question for Verizon and Cisco is whether CFO’s, CIO’s and business decision makers will accept ROC. “We’re curious ourselves,” Alla told me. While there’s work to do in proving the value of collaboration, ROC is an important step towards evaluating the return on collaboration investment.

Cleantech Growth Impacting Venture Capital Ecosystem

Two years ago, Ira Ehrenpreis was quick to extend a hand at the IBF Venture Capital Investing Conference in San Francisco. When the general partner of Technology Partners told other VC’s that he invested exclusively in cleantech, they smiled and nodded politely.

 

“We could barely fill break rooms a few years ago. Now we’re filling ballrooms,” Ira told a ballroom audience during his keynote entitled “The Future of Clean-Tech” last Wednesday at this year’s IBF Venture Capital Investing Conference in San Francisco. Ira’s influence among venture capitalists has grown as cleantech has expanded from 1% of the venture capital sector a few years ago to 20% this year.

 

Cleantech was once considered just solar and biofuels. Today it touches on everything from transportation to energy-efficient windows. “There’s been a historic underinvestment in cleantech from venture capitalists, corporate and others,” according to Ira. Driving the growth of cleantech as a sub sector of venture capital is a shift in our collective consciousness. Enterprises are increasingly embracing sustainability and “going green.” In years past, a few companies including Google, GE and Wal-Mart made real commitments and others “greenwashed” their products through disingenuous marketing. Incidentally, this mirrors the current shift from enterprises using collaboration as a buzz word or marketing hype to actually collaborating.

 

The cleantech venture capital ecosystem is far more global than the incubation system for most information technology start-ups. While Silicon Valley is the traditional epicenter of start-ups and VC, different global regions lead in developing particular cleantech technologies. Europe, Ira notes, has been leading in developing solar and wind technologies.

 

As cleantech grows along with global investments in information technology and biotechnology, the collaborative ecosystem that defines venture capital will become more global and less Silicon Valley- focused.

Toyota's Collaborative Leadership Involves "See it for Yourself"

In selecting Akio Toyoda as its next president, Toyota is reaffirming its commitment to collaborative culture and methods. A key tenet of Toyota is genchi genbutsu which means "see it for yourself.” This is related to the leadership method practiced by HP’s David Packard and Bill Hewlett beginning in the 1940’s and later dubbed “management by walking around.” The idea is that to figure out what’s really going on in an organization, a leader needs to get out of the office, go to factories and loading docks and retail outlets, and get his or her hands dirty.

 

That’s exactly what Akio Toyoda did when he visited a Toyota dealership in Ann Arbor, Michigan last summer. He wanted to personally investigate a pickup truck recall. A story by Micheline Maynard on February 15, 2009 in the New York Times says Toyoda made a trip “so secret that Toyota’s public relations staff didn’t know he was here.” While at the dealership, he reportedly got down on his hands and knees to examine the undercarriage of a truck. At the news conference in January announcing his appointment, according to the Times, Toyoda announced he would pop up everywhere as he did in Ann Arbor.

 

Genchi genbutsu or “see it for yourself” fits squarely into collaborative culture and methods. However, it’s not always possible to fly across the world to see what’s happening. That’s where collaborative tools come into play. Through unified communications, we can find one other and connect regardless of level, role or region. We can escalate IM to voice, web conferencing or videoconferencing and spontaneously hash out problems and make decisions. Visual communications is a critical enabler. An ideal solution is telepresence, which makes people feel practically as if they’re sharing the same physical space regardless of distance.  

 

Our research at The Culture of CollaborationÒ Institute has shown that almost all highly-collaborative companies have integrated some form of real-time, interactive video into their operations. As I describe in The Culture of Collaboration book, Toyota uses a custom-designed visual communications system coupled with product lifecycle management and advanced computer-aided design tools that has become essential to its operations. The system links people at design facilities, plants, and at business partner sites and provides a rich virtual environment for developing and producing vehicles.

 

Two other areas involving collaboration that Akio Toyoda will likely re-emphasize:

1)     Making decisions based on long-term goals rather than on short-term developments

2)     Nemawashi or making decisions slowly by consensus

 

While collaborative culture is never about one person, Akio Toyoda is certainly one role model for collaborative leadership.

Innovation Value Institute Enhances Collaboration and Unlocks IT Value

As I stepped into the new “innovation zone” outfitted with leather couches, lounge chairs and café-style tables and stools at Chevron’s headquarters in San Ramon, California yesterday, ideas were flying. The Innovation Value Institute, a consortium focused on enhancing information technology’s role and demonstrating its value, has set up shop for two days at Chevron and yesterday announced its efforts. You can hear the announcement and see slides here. Collaboration is fundamental to IVI in that:

 

1) Competitors are collaborating in the consortium

2) IVI’s framework will enhance collaboration between IT and business units

 

The core consortium includes oil and gas competitors Chevron and BP, competing consulting firms Boston Consulting Group and Ernst & Young, and software companies Microsoft and SAP. Northrop Grumman is also part of the core group as is Intel. In fact, Martin Curley, Intel’s global director of IT innovation, co-directs the Institute, which is housed at the National University of Ireland, Maynooth. Each company is sharing intellectual property, and the partners are all getting more out of the collaboration than the IP that they’re investing. Through the consortium, according to Curley, the members are shifting their thinking and approach from “competitive advantage to collaborative advantage.”

 

IT is evolving from a service to a “business-embedded” role within enterprises. “IT organizations grew up with the service business model… acting as waiters and waitresses. What technology can I serve you today?” notes Natalie Stone, director of business strategy for Northrop Grumman. “We’ve come pretty far, and we’re poised to take the next leap.”

 

That next leap for the consortium members involves developing an IT Capability Maturity Framework (IT-CMF) of 36 interconnected processes—things like service analytics and intelligence, enterprise architecture, and innovation management. The idea is to establish a common language and standards for measuring how IT creates business value.

 

So, how does IVI quantify the value? Ralf Dreischmeier, partner and managing director of the Boston Consulting Group, says the consortium is focused on “50/50/50.” That means increasing IT return-on-investment by fifty percent, reducing time-to-market by fifty percent, and reducing business costs by fifty percent.

 

Consortiums often deliver little more than announcements and joint news releases, because of the lack of collaboration. “Five to ten years ago, this would have been dead,” insists Dreischmeier. “People were much more protectionist, thinking only about their little environment.”  IVI is succeeding because of the premium its members are putting on trust, sharing and innovation. These are three of the Ten Cultural

Elements of Collaboration that I identify In The Culture of Collaboration book.

 

In parallel, businesses can create greater value if there is more trust between IT and business units. “If you don’t have the trust, there’s no way you’re going to make IT better,” acknowledges Chevron CIO Louie Ehrlich. Environment is another element, and Chevron’s “innovation zone” is designed to enhance collaboration and experimentation. “Chevron likes to do things with quality or not at all, but sometimes we need to lighten up and make mistakes,” insists Jack Anderson, Chevron’s innovation specialist, a consortium participant who is also championing collaboration within his company.

 

I’ve blogged and written in my book, spoken and advised organizations about how cultural diversity enhances collaboration, enables broader input and contributes to better decisions and products. Culture may be regional, organizational, functional, or departmental. The IVI includes cultural diversity on all of these levels. “Diverse groups work much better together,” is how Edwina Fitzmaurice, partner with Ernst & Young, sums it up. Fitzmaurice, based in Ireland, has a diverse professional background including stints as CEO of Prudential Europe Management Services and CIO of J. Rothschild International.

 

Many of the consortium members—and many other enterprises and IT vendors—have developed their own frameworks for IT value. Microsoft is no exception. There’s broad agreement, though, that an industry standard framework makes more sense for vendors and enterprises. “We can then talk about our product portfolio in a way that resonates rather than being product-centered,” says Samm DiStasio, senior director for business architecture and optimization in Microsoft’s enterprise and partner group.

 

Ultimately, ITI’s work will be publicly available—but it will never be finished. The nature of a collaborative framework is that it’s dynamic. As business shifts and IT evolves, ITI’s model will also change.

Cisco, Tata and Taj Hotels Bringing Telepresence to Smaller Companies and the Public

As I walked into Cisco’s new public telepresence suites yesterday at the WebEx tower in Santa Clara, California, I was greeted by a video receptionist. “Hi, may I help you?,” the receptionist said. I immediately sensed professional intimacy, because of the quality of the visual experience. “I’m here for a Cisco telepresence session,” I explained. The receptionist then invited me to help myself to the catered breakfast in the outer lobby. I then grabbed a cup of milky, cardamom-spiced Indian coffee, which hinted at the global nature of what was about to happen.

 

Down the corridor were several public telepresence rooms of different sizes. Cisco people including Marthin De Beer, senior vice president of the emerging technology group, were in one room with Peter Quinlan, director of telepresence managed services for Tata Communications. I was in another room with the research director of The Culture of CollaborationÒ Institute plus a few journalists and analysts.

 

Joining from his home in Bangalore, India was Wim Elfrink, Cisco’s chief globalization officer, presumably conducting his last meeting of the day at 11:00 p.m. Bangalore time. In London, Vinod Kumar, chief operating officer of Tata Communications, and his colleagues participated. From Boston, Taj Boston Hotel General Manager David Gibbons joined us from the Taj’s new telepresence public room. From New York, an industry analyst was also connected.  So, our group spanned the globe—six connections in four time zones. However, we felt almost as if we were sitting across the table from each other.

 

Cisco and its partners are challenging the notion that telepresence is an exclusive tool for Fortune 500 executives. “We have found that the largest users of telepresence are the mid-management level in our organization,” says Kumar of Tata Communications, a subsidiary of the $62.5 billion Tata Group. If you’ve been to India, you know that the Tata name is everywhere—on motor vehicles, industrial equipment, and even tea. In recent years,Tata has become a global company.

 

Tata is a highly-strategic relationship for Cisco in that besides its communications business, the Mumbai, India-based conglomerate has holdings in engineering and building, services, chemicals and consumer products. Taj Hotels, a Tata company, is providing public telepresence rooms in Boston, London, Bangalore, Mumbai and other cities throughout India. “Small and medium-sized businesses will be the greatest users,” predicted Gibbons of the Taj Boston Hotel. There will be a hundred public TelePresence (note that Cisco capitalizes the “P” in its trademarked product name) suites globally by late 2009, according to Cisco. Hourly fees currently range from $299 for a 1-2 participant room to $899 for an 18-participant room.

 

Unlike office buildings that typically close nights, weekends and holidays, hotels are open 24/7 every day of the year and provide perhaps the best opportunity to maximize a global business environment through pay-per-use telepresence. It’s a holiday in your city, but you need to connect intimately with colleagues in another region where it’s a regular work day? Hotel-based telepresence addresses that issue.

 

Significant from a technical perspective, Cisco and Tata are providing secure, encrypted conversation through any company’s firewall. “This has not been possible before with any technology,” noted Marthin De Beer of Cisco. Tata Communications delivers converged voice, video and data over Internet protocol (IP). Tata’s strategy is to get companies used to telepresence through public rooms and work on migrating some companies to invest in their own telepresence rooms.

Cisco says it has integrated 300 telepresence systems into its own operations globally. Some senior leaders including De Beer have their own systems, and Wim Elfrink, Cisco’s chief globalization officer, joined yesterday’s telepresence session from his home office in Bangalore, India.

 

While much has been made about videoconferencing and telepresence reducing long-distance travel, these tools can also reduce local travel and commuting. De Beer noted that he saves an hour per day by using telepresence instead of driving to meetings on and around Cisco’s campus. As telepresence becomes more widespread, people will gain the opportunity to work globally while reconnecting with their physical—as opposed to virtual—communities. Telepresence will also allow for better work/life balance and potentially take social responsibility to the next level.

 

After the session, as I said goodbye to the video receptionist, I wondered whether receptionists in Mumbai, Manila and Montego Bay will soon be greeting visitors in corporate lobbies in Memphis, Modesto and Milwaukee. Well, Cisco’s Marthin De Beer, who is based at the company’s headquarters in California, has a video assistant who works from Texas and virtually greets visitors to his office. So, Cisco is clearly practicing what it’s preaching.