Why Collaboration Value is Understated

Applying mechanical process productivity to collaboration provides us with an efficiency benefit case for collaboration. Understanding the true benefits of collaboration requires us to understand the knowledge work systems in place and the broader effectiveness of the organisation at creating value.

Value of Collaboration is Not Easy

We always facing the challenge of valuing the benefits of collaboration.  Collaborative technology is part of the infrastructure of the organisation. It’s use is open to many applications that will be co-created by the employees and shaped by the organisation. Many of the outcomes are not direct; collaboration facilitates a more effective organisation.

The temptation is to play it safe. We can use the same process efficiency mindset that applies to any other system to automate processes.  The question usually asked is “How much more efficient will our people be when they use a collaboration system?’  A number of studies have looked at the impact of collaboration systems on in process efficiency of knowledge workers. One of the most widely quoted statistics is the McKinsey survey that identified 20-25% of the time of knowledge workers could be saved with better ways to search for and interact on information. This mindset often drives an adoption focus to collaboration projects that misses a bigger opportunity to create value.

25% Better Off?

If you are processing iron ore into steel and you find a way to do it 25% better, then you will have 25% more steel or need 25% less inputs. That is a mechanical process saving. Inputs became outputs at a cost. This is how our traditional efficiency mindset has focused us on measuring value.

However, knowledge work isn’t like steel manufacture. At the end of a knowledge work process, we still have the inputs and the outputs. Both the inputs and the outputs can be shared widely at very low cost because they are easily reproducible. Most importantly, neither the inputs nor the outputs are fixed. 

Let’s consider a practical example. As a knowledge worker, you are asked to create a new process to improve the efficiency of steel production. Is the goal to do this 25% faster? No, the goal is to create the most efficient way of producing steel.  There are four elements that measure effectiveness of your work:

• Reduce waste: If there is no better way currently possible or someone has already done the work, then don’t work on creating a new process. Do something else.
• Reuse existing knowledge: If someone has developed a process that is more efficient, use that process as a basis. Don’t start with a blank page.
• Create new knowledge: If you can bring together people who have never been connected, if you can share information that has not been shared you may be able to solve new problems or create an entirely more effective process for steel manufacture. This is likely to impact a much larger value opportunity than knowledge work in your organisation.
• Create new value with existing or new knowledge: Your new process for steel manufacture will be able to be shared across your organisation and may even become a product in its own right.

The economic value of these four elements aren’t productivity measures of knowledge work.  The economic value is the impact on the production of steel and the greater value created in the organisation by collaboration to improve steel production. In my experience the benefits from simply stopping wasteful projects without any value add, is an order of magnitude larger than the productivity benefit from reduced search by knowledge workers.

Thinking more broadly about the economic impacts of collaboration can create a dramatic step change in the benefits for an organisation.  Rather than looking at efficiency in the cost base of knowledge work, collaboration impacts value creation organisation-wide. This new view has a critical role to play in shaping leaders support for collaboration and the level of investment an organisation should make in fostering collaboration in the organisation.