Collaboration is the better way to compete

Those who know me, know that I like to quote famous frames, either from movies or from people who I have met. There was one I remember lately quite often from the year 2000 of a colleague of mine. I was working at that time at Ariba and I believe we were like the darling of the NASDAQ. It was the golden times of when money was just an option and everybody wanted to do business with us. A customer asked a colleague of mine “what is your goal as company” and he replied “World Domination”. I did not really take it serious at that time but the power games in business are actually quite interesting.

World Dominiation, it reminded me quite a bit of history and others have tried it. There is no intention to go into politics here but still I find it interesting how really nobody takes history serious in order to learn from it. But just some simple thoughts related to it.

The good old rule of the big eats the small has a certain sense of truth in many cases. Yet being the biggest does not only give you advantages. Simply because of the size there will be three main things which work in your contra.

1. you have a much bigger attack surface and there will be by definition more who will want to attack you just because of that.
2. you will not be able to move as quick than the smaller ones around you
3. you need a lot more energy / supplies in order to keep going

I often compare business to war Sun Tzu is a great reference library for that. So when a country goes to war they tend to feel they are superior and have a right to expand and impose themselves. They grow, they need more supply and also they have a much bigger attack surface. They cannot simply move troops around as they need since they need to secure their fronts.

Something similar happens with companies when they grow, go through M&A and thus become and more and more interesting attack target. I have yet seen few M&A processes in which the synergy effect has really kicked in. Where there were good vibrations between the one who got bought and the one who bought. A lot of energy is lost on that track. Both feel right and the truth will be like in most cases in the middle. Yet it tends to be the one who has bought who will impose his way of doing and thinking.
Actually funny since in most cases the company who got acquired must have done something very well in the past in order to be a target for takeover. So why not try to “merge” those two approaches and create a new one which would be the real benefit for both?

The current economic environment, especially in IT, is increasing the competition heavily. The cake got smaller and yet the number of companies who want to eat from it has increased. Still the principles of business have not changed. Most customers look not only for vendors but they look for partners. This is not always lived but still is what the ultimate aim is. Customer do not have only 1 partner but they will have a whole bunch. Keeping it on the IT subject simple combination could be Servers, Network, Operating System, Storage, Applications etc

The aim of the customers will be not only have chosen the best partners for themselves but also that those who they have chosen will partner among them in order to deliver the highest amount of value. Lately it seems that those “partnerships” are vanishing more and more. The hunger for ever increasing sales lets some vendors loose the sight of the ultimate goal, thus there will be a point where this loose of focus will be reflected on their results. Still the golden rule applies, “He who has the gold, makes the rules” thus customers who feel that one of their partners is not partnering with the others of his choice will probably deselect them.

A good friend of mine reminds me quite often of “Keep your friends close, but your enemies closer”. This simple guidance is too often forgotten and we try to take on our competitors. Forgetting that the amount of competitors we can really take on at the same time is limited. There is no magic to it.

Attitudes of abuse of power like the one below might have worked in the past but not today anymore

The key to success is in collaboration and trying to reduce the amount of enemies not by taken them out but by making them more friends!


About cnitschke

This blog is purely personal and reflects only my personal opinion. None of the content can be related in any way to my employer or former employers.
Aside | This entry was posted in Management, Motivation, Sales, Uncategorized. Bookmark the permalink.

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