Apr 7, 2009

"The Economist" Previews Morten Hansen's New Book

From The Economist

Getting Togetherness

The pitfalls of trying to create a collaborative workplace

The success of the iPod, launched by Apple in October 2001, sparked panic among the American company’s competitors. When it became clear that the diminutive device was far outselling other digital music-players, Sony, a big Japanese rival that had pioneered music on the move in the form of the Walkman, scrambled to respond. It convened several internal teams from its different businesses to work on a project, named Connect, that was supposed to come up with a product to counter Apple’s. But after a number of years of trying to produce an iPod-killer, Sony admitted defeat and disbanded the Connect initiative in 2007.

Apple’s success with the iPod can be explained by its ease of use, sense of design and a host of other factors—including the company’s ability to get different parts of its business united around a common goal.... But dismantling internal barriers to co-operation is a tricky business that requires much more than smart software. Unless firms are careful, there is a real danger that collaborative crusades could do them more harm than good.

The reason for this is that bosses often fail to take a hard-headed look at the costs of joint projects. In a book to be published next month, Morten Hansen, a professor at the University of California, Berkeley, identifies two sets of such costs. The first is the opportunities that business units could have pursued if they were not collaborating. Such opportunity costs are often forgotten or minimised as divisional managers seek to comply with exhortations to work more closely together. Then there are the costs associated with fostering co-operation. As well as obvious ones such as, say, paying for extra travel, there are also more subtle ones such as the cost of time spent haggling over joint objectives and resolving conflicts.


Last updated:

October 4, 2016