The Advantages of Collaboration in Business

Collaboration in business is vital, although many business owners may not realise it at first. While many business owners prioritise sales, marketing, and staffing, which are all important, they don’t recognise the crucial need to prioritise internal and external collaboration opportunities. In this article, let’s take a closer look at the advantages of collaboration in business – both internally and externally.

Most businesses today have many different moving parts. A company typically has a sales team, a marketing team, an HR department, and more. Some businesses work with external suppliers, partner with other companies, or work with consultants. Let’s add the fact that as much as 55% of workers now spend more time working remotely than at a physical office. Getting these different moving parts working together to result in smooth and successful collaboration in business is crucial.

What is the definition of collaboration in business?

There’s little difference between the meaning of collaboration in business and the definition of collaboration in other areas. Simply put, business collaboration is working together to achieve a common goal for your business. Business collaboration maximises internal and external relationships to create new concepts, generate ideas, and solve problems to achieve common business goals.

Why is collaboration essential in business?

Effective collaboration in business positively impacts a company and its employees. The famous quote “No man is an island” can also be translated to “No business is an island.” Whether you like it or not, your company or business doesn’t operate in a vacuum. Other organisations and companies affect your business, and your business also has employees you must keep productive and happy.

A business must encourage a collaborative mindset within and between owners, management, employees and other businesses. A company working with another business can create a synergy that might not be possible when working alone – success isn’t a solo activity. When a business is open to collaboration, it improves how employees work together internally and how they find solutions to problems externally. Effective collaboration in business also leads to increased success, innovative ideas, more efficient workflows, and improved internal and external communication.

Business collaboration benefits

There are several benefits of business collaboration for companies and employees. These benefits apply to collaborating with other businesses or external collaboration, as well as internal collaboration.

Here are some of the most common benefits of collaboration:

·        Financial gains

The primary purpose of all businesses is to generate profit. Successful collaboration between companies or organisations can bring significant financial gains for both parties. Working with another business can increase sales, cut costs by sharing or combining resources, and enable companies to target more significant contracts.

For example, let’s say your business manufactures furniture. Yes, you can have a steady stream of clients you bring in on your own, but imagine if you partner with an architectural or interior design firm. Both businesses can benefit significantly from collaborating, which improves the bottom line for both organisations. Instead of having one revenue stream, partnering with another business can open more ways for you to make additional sales. This collaboration can create many new business opportunities for both parties.

·        Increases productivity

Another advantage of collaboration in business is that it increases productivity within the company. Collaboration tools can increase productivity significantly.

Today, many businesses generate large amounts of data, and different teams within the company must have access to this data. For example, a finance team may need access to HR and sales data to make sound financial decisions and determine the company’s overall strategy. Even if the finance department is composed of one person and the other teams have just two to three employees, each team has to take extra time and effort to gather data and turn over the needed data to the person asking for it.

A collaborative environment with collaboration tools can automate and speed up this internal process. These tools can regularly and consistently disperse needed information to relevant departments without manual intervention—this type of environment results in faster and more productive operations.

·        Improves employee engagement and well-being

Numerous studies and surveys have shown the benefits of collaboration on employee engagement and well-being. For example, a Stanford study reported that employees working in a collaborative setting are 50% more effective at completing tasks than in a highly individualised one. Working in a company that encourages collaboration also helps them become more engaged with others and their work.

Another study by Wrike found that “poor communication,” “team members not pulling their weight,” and “bottlenecks” are among the leading sources of stress at work. We can all probably relate to the feeling that communication in your workplace needs improvement and the stress that comes with figuring out how to bring issues up with your team leader.

Companies that foster a collaborative environment will improve productivity, employee satisfaction, and quality of work.

·        Provides learning opportunities for collaborators

When businesses, or people, collaborate, it offers them opportunities to learn from others. A collaborative work environment allows individuals to learn from each other through feedback and sharing their unique perspectives. Individual workers begin seeing themselves as part of a larger team and learn to work together more efficiently and effectively.

Collaboration aims to create mutually beneficial relationships from which everyone can benefit. Businesses collaborating can also learn new ways of doing things and industry best practices. A company you recently started working with might use a type of software you’ve never heard of or encountered. They also might learn a new sales strategy from you that they can apply to their own company.

Small business collaboration

For small businesses, collaboration is a great opportunity. The same industry collaboration advantages apply, no matter the company’s size. Some examples of these advantages are increasing revenue, gaining more customers, and growing your network. Small business collaboration also offers learning opportunities for both companies. Owners and employees can learn new skills and strategies from each other.

Typically, a small business can collaborate with other companies they currently work with, share the same target market, or are in the same location. In other words, you should collaborate with a company that complements your business. For example, a business that sells maternity clothing can work well with a company that sells baby clothing or baby supplies.

Collaboration opportunities

Collaboration opportunities between small businesses can start small and grow as each business reaps the benefits of collaborating. Some examples of collaboration opportunities for small businesses are cross-promoting via each company’s social media. For example, you can combine prizes with other companies and run an Instagram giveaway for online collaboration.

Let’s say you sell running shoes. You can partner with another business selling sportswear or sports water bottles. Simply put, you can collaborate with any company that complements your products. Instead of just giving away a pair of shoes during your online contest, your prize can be composed of running shoes, a sports water bottle, socks, and running tights.

By working together, all parties can offer a bigger and more appealing prize, reach more potential customers, and grow their social media accounts. Other examples are holding joint events and guest posting on each other’s blogs and websites. You can also co-host a webinar or write a special newsletter together. These types of collaborations strengthen each company’s brands and broaden its reach.

Reach out to companies you are interested in working with to see if they are open to collaborating with you. Even if you’re unsure if the company is available to collaborate, give it a go! They might also be looking for companies to collaborate with, and if your concept and products fit their business goals, they’ll be happy to partner with your business.

Start collaborating

Remember, you need to look for collaboration opportunities actively. Like other aspects of doing business, these opportunities won’t fall in your lap. You need to sit down and list whom you can collaborate with and what kind of collaboration will result in win-win situations. Whether it’s through an online partnership or running an event together, think of ways you can start working with other businesses.

Don’t forget about your employees. Creating a collaborative environment and mindset will help you maximise the advantages of collaboration in business and keep your employees happy. If you’re not sure where to begin, think of how your employees communicate with each other internally. Maybe it’s about time to invest in a collaboration or project management tool that makes collaborating easy.

Ultimately, all business initiatives, including collaboration, aim to grow your business. Collaboration is a strategy you can include in your business goals and objectives. While fostering a collaborative mindset and environment takes time and effort, the more you do it, the more it will become second nature to you. Soon, thinking of possible business collaborations and encouraging your employees to work together will become an integral part of your everyday operations.

Collaboration doesn’t reduce your opportunities or your pool; on the contrary, it doubles them.

 Lorraine Garvie

District32 – The Power of Connection