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4 minute read


When a business competitor becomes a collaborator


In the past, collaborating with a competitor was considered illogical. But in today’s world, it’s crucial to driving innovation and long-term success.

Small companies and large corporations seem to be worlds apart from each other. But there’s a rising trend of collaboration between the two as they learn from each other and identify new business opportunities in partnership.

Typically, start-ups lack the market access, workforce, resources and financial stability of their larger counterparts. However, they make up for this in agility, versatility, determination and innovation, which many established corporations struggle to match.

These differences are the biggest reasons why bridges should be built between small and large businesses. Collectively, they have the recipe for success, and by collaborating they can boost their chances.

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Collaborative innovation is the engine of modern, agile organisations capable of creating new capacity, which can pioneer radical new ideas while testing the limits of markets.
Mark Esposito, Professor of Business and Economics at Harvard University Extension School

In their book, Winning Combinations: The Coming Wave of Entrepreneurial Partnerships Between Large and Small Companies, James W. Botkin and Jana B. Matthews explore the value of business collaborations. They state that the strengths of entrepreneurs and corporate executives are often opposite, yet complimentary. And, it's this harmony that “can brighten their global prospects”.

Published in 1992, Botkin and Matthews are proof that collaboration is not a revolutionary concept, but one that has been evolving for decades now. And, thanks to today’s start-up boom, they’ll continue to do so.

Introducing innovation to collaboration

According to Mark Esposito, Professor of Business and Economics at Harvard University Extension School, “collaborative innovation is the engine of modern, agile organisations capable of creating new capacity, which can pioneer radical new ideas while testing the limits of markets.”

Essentially, collaborative innovation can be one of a business’ best chances for growth. Not only does it introduce new or improved products and services that tap into existing market demands, it increases workplace productivity. These results are key to ensuring a business thrives in today’s digital landscape, in which more and more innovative technology is making its mark.

Compared to large organisations, which are set in their ways, start-ups are in a superior position to shorten the innovation cycle. A light-structure and flat hierarchy means they can exploit new technology, enhance existing business models, and invent new ones more quickly and effectively.

If corporations want to break the status quo and fast-track disruptive products and services, collaborative innovation with a smaller business is crucial.

Companies leading this trend create value by:

  • Defining collaboration objectives to ensure commitment from all business levels, not just from the top
  • Being open to failure and incorporating this into their broader business risk assessment
  • Identifying when sensitive data could be revealed to a partner and what measures to take to protect it
  • Publishing their innovation needs in business and industry media to attract promising prospects
  • Considering the benefits of collaboration from the perspective of potential partners to ensure mutual gain

Changing perceptions

Collaboration is invaluable to small businesses, especially in the early days when they’re finding their footing and need expert advice. It's their means to learn from experienced corporations, acquire new skills and achieve their business goals.

Small businesses should recognise that large regional, national, or even international companies can play more attractive roles than the one of a competitor. Larger companies can be business partners, product distributors, or customers. What’s more, every business partnership is unique one small company’s aggressive competitor may be another’s business ally.

Case study 1: Vodafone and Headstart

We prove the mutual benefits of a business collaboration between us and Headstart, the mobile app, using machine learning to redefine the hiring process.

With Headstart as our partner, we’re  able to focus on our candidates’ skills, personality and motivations – not their CVs – and we’re able to recruit talent that’s the best cultural fit for the business.

When we began our partnership, Headstart was only just beginning to assert its position in the business world so, we were integral to building its portfolio and reputation. 

Case study 2: Siemens

The Siemens’ collaboration story is not centred around one business partnership, but multiple. Through its Technology to Business centres, the conglomerate seeks out the latest and most exciting technology innovations from inventors, start-ups, universities and research labs. It then provides the expertise, resources and help with funding to transform these disruptive ideas into real-world products.

Technology to Business is a champion of “outside-in” innovation on a global scale. So, no matter where their candidates are located, every single one has an equal chance at partnering with the corporate giant and embarking on the road to success.

Looking at the bigger picture

Within start-ups and established companies, there are missionaries and mercenaries. However, to achieve a successful collaboration, in which both parties benefit, the former has to outweigh the latter. Businesses, of all sizes, need to extend their focus beyond financial success to long-term success, and this means having a mission-orientated mindset.

Large corporations and small businesses may seem incompatible on the face of it but, with this mind-set, they can tap into the strengths of their counterpart and create a resilient partnership. Collaboration is a win-win situation, and is an ideal way to start your journey towards a secure and exciting future.

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