When Internal Collaboration is Bad for Your Company by Morten T. Hansen

Harvard Business Review April 2009 

Reprint No: R0904G

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     It is conventional wisdom but a false assumption that the more employees collaborate, the better off the company will be. In fact, collaboration can undermine performance. The author and his colleague’s (M. Haas) research of over 100 experienced sales teams found that the greater the collaboration (measured by hours of help a team received), the worse the result (measured by success in winning contracts). They concluded that experienced teams typically didn’t learn as much from their peers as they thought they did. The marginal knowledge they did gain was often outweighed by the time taken away from their work on the proposal. Their statistical analysis found that novice teams actually benefited from exchanging ideas with their peers. The problem was determining when it makes sense and when it does not to collaborate.

     Business leaders ask, How can we get people to collaborate more? The correct question is, Will collaboration on this project create or destroy value? To collaborate well, is to know when not to do it. This article offers a simple calculus for differentiating between “good” and “bad” collaboration using the concept of a collaboration premium. The aim is to encourage groups to work together only when doing so will produce better results than if they worked independently.

     The author describes in detail:

•      How Collaboration Can Go Wrong
•      Knowing When (and When Not) to Collaborate
•      Avoiding Collaboration That Destroys Value
•      How Collaboration Can Go Right

     The analysis provides needed discipline in deciding when collaboration creates or destroys value. As organizations become better at collaboration, through incentives and shifts in corporate culture, the associated costs will fall and the percentage of projects likely to benefit will rise. The challenge is to cultivate the right collaboration – to achieve the great things not possible when we work alone.