T o innovate, many high performing firms are collaborating beyond their organizations -with their extended networks of suppliers, customers, business partners and others. Such collaboration, however, is not easily accomplished. In fact, about 50 percent of strategic alliances fail. [1] Here is a framework for managing these alliances -the ABCs of collaborative innovation -that can improve the chances of success. Indeed, the strongest collaborators in a recent IBM study were also the strongest financial performers.In the study, while 76 percent of CEOs cited the importance of enabling collaborative innovation, only 51 percent reported that they were achieving this goal. One big challenge is that, as organizations become more global, they face more complex issues related to culture, regulation, technology and other areas. Further, with the growing trend toward extended enterprise models, involving more external partnerships, collaborative innovation is even harder to manage successfully. We believe collaboration problems across organizations are key factors contributing to the demise of strategic partnerships. Know your ABCs: a framework for collaborative innovationTo avoid the pitfalls of collaborative innovation, our research and experience show the best building blocks are: alignment, boundaries and commitment, which we call the ABCs. Alignment entails synchronizing the strategic vision and innovation goals with the implementation of these throughout the organization, focusing on collaboration both vertically and horizontally. Managing boundaries enables collaboration across organizations, establishing structures and processes regarding governance, operations and technology. Finally, an ongoing commitment is required to orchestrate and systematize collaboration for innovation throughout the organization and its extended enterprise over time. These ABCs can be done separately or in combination, depending on the capabilities, strategic goals and innovation objectives of the organization. A ¼ alignmentAlignment is a key step in ensuring that the business strategy is communicated and enabled throughout the organization both vertically and horizontally. Alignment requires looking at the organization from the perspective of innovation objectives, and then using the insights gained to position the organization to meet those objectives.B Vertical alignment translates the business strategy's innovation objectives into an organizational strategy and an implementation plan. Once translated, the business strategy provides a strategic roadmap for change.B Horizontal alignment typically requires the creation of a new organizational unit or the redefinition of existing ones. Key here is the elimination of structures and processes that
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