Collaboration is costly, and administrivia worse

More evidence that blindly pursuing collaboration across different units in a large corporation, or between corporations may cost more than its worth.

Morten T. Hansen, When Internal Collaboration Is Bad for Your Company

Whether because of enthusiasm for collaboration or the natural optimism of managers, many companies place a mistakenly high value on collaboration. Especially when a team’s work appears to be a model of collaboration—the parties freely share resources and cooperate in resolving differences while coming up with nifty ideas—it may be easy to overlook the fact that the work is actually generating little value for the company. Never forget that the goal of collaboration is not collaboration but, rather, business results that would be impossible without it.

In numerous well-known instances, collaboration premiums failed to materialize. Daimler’s $36 billion acquisition of Chrysler in 1998—with its promise of synergies between the two automakers—and the sale nine years later of 80% of Chrysler for a pitiful $1 billion constitute only the most conspicuous recent example. But collaboration’s benefits are usually overvalued in much more mundane settings. Recall how the experienced sales teams at the IT consulting firm that Martine Haas and I studied shared expertise as a matter of course during the preparation of project proposals—never stopping to seriously consider whether they in fact benefited from doing so.

Turns out that people might expend a great deal of effort on preparations for collaboration — like bidding on joint projects — that fails to materialize, and even if it does, the payback might be less that what the participants might have gained independently.

This seems related to dropping all the make work in business in order to become faster and looser. For example, in a recent study by Julian Birkinshaw and Jordan Cohen (see Make Time for the Work That Matters), one manager as a Scandinavian insurance company simply dropped meetings and administrative tasks in order to spend more time with her team, and sales went up 5% in a three week period.

The one two punch is this:

  1. We believe that collaboration is good, and more of it is better, so we spend precious time on it even when the participants would be better off sticking to their own knitting.
  2. We are ensnared in a network of commitments that will suck the life out of our work: meetings, responding to unnecessary email, administrivia. If we simply said no to those petty corporate annoyances and dedicated that time on our actual work we’d be both more productive and happier.

There is a gradient between cooperation — helping others to make progress, and looking for high payoff opportunities to work with others — and collaboration, but in general it seems that the nature of corporations is to pull us into a quagmire of corporativity instead of freeing us to increase our productivity.