No Man is an Island
Technology changes everything
Scholarly Article |
Information and telecommunications technologies connect society with information (and each other) on demand. Such technologies have forced organisations to transform from reactive and bureaucratic models and adopt adaptive, networked-oriented ones, forever changing the way the world does business (Freedman, 1992, Kiernan, 1995, Manabat, 2004, Travica, 1999).
Within this turbulent environment 'cooperative value-networks' (i.e. joint ventures, minority investments, tactical and strategic alliances, partnerships, licensing agreements etc...) have emerged from Porter's traditional value-chain and value-system (Clarke, 1994, Drucker, 1999) as a means to transcend conventional boundaries and allow business to deliver on the fervent demands placed on new product and service offerings (Amidon, 1996, McKenna, 1999, METAGroup, 1999, Venkatraman, 1994).
Ultimately, technologies of connectivity, mobility, and mass information exchange have irrevocably altered the environment of business systems and have forced the modern organisation to find ways to adapt, generate and innovate.
The networked revolution
In what Rayport & Sviokla (1999) describe as a topsy-turvy networked world (the world of the 'virtual value chain'), modern organisations have been forced to shift away from a monolithic existence toward one of where value is derived from relationships:
"No man is an island, and these days, few businesses are either. Companies operate in a complex web involving a host of different players, including suppliers, customers, competitors, regulators and collaborators. The challenge is no longer how to manage the business, but how to manage it within the wider context of networks" Bessant, (2004) |
Enabling the collaborative potential of modern organisations is the ability to employ informational technologies across traditional boundaries. Over the past few decades, most organisations have invested heavily in the technologies of information to master most, if not all the value-adding activities in their value chain and en route, have become increasingly reliant upon it (Clarke, 1994, METAGroup, 1999). From productivity improvements gained through process automation within large scale industry, to the new age information economies of scale and scope, informational technologies greatly influence every level of business (de Dommartin, 2003, Manabat, 2004, Quinn, 1999).
At the same time, demands on operational agility have influenced organisations to focus on the delivery of core value-adding work and seek external competency for processes which do not provide a direct competitive advantage (Nachira, Chiozza et al., 2002, Quinn, 1999, Reid, 1998). In other words, organisations are becoming increasingly content to remain 'lean' and outsource non-strategic business functions to what is becoming an ever-competitive pool of external service providers . Consequently, we arrive at the well documented 'virtual integration, of the networked organisation as the promising solution to performance demands of a hyper-competitive complex digital economy (Kiernan, 1995, Lulu, 2002, Nachira, Chiozza et al., 2002, Quinn, 1992, Skyrme, 1999, Stapleton, Gentles et al., 2001).
Such complex business ecology has prompted the European Commission to foster ambition projects into the development of knowledge-based, networked business ecosystems. The goal of these projects is to develop 'digital business ecosystems.' Consisting of self-organising digital infrastructures, these ecosystems intend to support greater social inclusion and local innovation systems within small and medium enterprise (SME). In a submission to the European Commission's call, Nachira, Chiozza et al (2002) underline the probable realities of network-orientation:
"As a consequence of this evolution, the dynamic networking of the organisations, drives to the dynamic cooperation of the players on the territory and the connection of the resources in a system, building a community that shares, business, knowledge and infrastructure. This will dramatically affect the ways enterprises are constructed and business is conducted in the future, and the actual slowly changing organisations will be replaced by more fluid, amorphous and, often, transitory structures based on alliances, partnerships and collaboration" Nachira, Chiozza, & Ihonen et al., (2002) |
Innovation demands have necessitated an extension of organisational relationships into a 'virtual' community space. Such inter-organisational partnerships share the knowledge and experiences of their participants in an attempt to leverage pools of complimentary expertise (know-how). In developing such cross-functional taskforces and risk-sharing partnerships, many organisations are beginning to accept a deeper sharing of collaborated benefits and losses (Nishiguchi, 2001). In an almost Keiretsu-borrowed framework (Targowski & Carey, 2000), the increasing supply of skilled knowledge workers and enabling technological infrastructure buttresses cross-border knowledge creation and innovation capabilities both horizontally and vertically (Linder, Jarvenpaa et al., 2004, Quinn, 2000, Skyrme, 1999, Westney, 2001).
Collaboration = Advantage
Thus it is no surprise that within this emerging new order, that organisations which are most capable of creating and maintaining collaborative partnerships will be those best positioned to capitalise on new markets (Nachira, Chiozza et al., 2002, Quinn, 1999). Indeed, the challenge facing most modern organisations within the complex digital economy is no longer just one of competitive advantage, but one of "collaborative advantage" Amidon (2000).
About the author
| With formal qualifications in software engineering, Martin has over eight years experience in the design and management of complex enterprise-wide ICT systems. Interests in online technologies and social networks saw Martin also complete a master’s degree in engineering, under the topic of "knowledge networking within complex business systems." Believing that service-based interactive web technologies hold the key to improving our business networking and interaction capacity, he launched SmarterSoft to create online systems to enable enterprises of all sizes to better engage and communicate with their customers. Contact Martin. |
Keywords
Knowledge advantage, collaborative advantage, networking, knowledge networking, collaborative partnerships, complex digital economy, cooperative value-networks, virtual value chain, digital business ecosystems, virtual integration, networked organisation, innovation.
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