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Building a Collaborative Enterprise


Our findings are based on many years of studying institutions that have sustained records of both efficiency and innovation. The writings of great thinkers in sociology—Karl Marx, Max Weber, Émile Durkheim, and Talcott Parsons—also inform our work. These classic figures were trying to make sense of broad economic and social changes during times when capitalism was mutating from small-scale manufacturing to large-scale industry. Our era represents just as momentous a shift, as we make the transition to an economy based on knowledge work and workers.

A Shared Purpose

Sociologist Max Weber famously outlined four bases for social relations, which can be roughly summarized as tradition, self-interest, affection, and shared purpose. Self-interest underlies what all businesses do, of course. The great industrial corporations of the 20th century also invoked tradition to motivate people. And many of the most innovative companies of the past 30 years—Hewlett-Packard, Microsoft, Apple, Google, and Facebook—have derived strength from strong, broadly felt affection for a charismatic leader.

In focusing on the fourth alternative—a shared purpose—collaborative communities seek a basis for trust and organizational cohesion that is more robust than self-interest, more flexible than tradition, and less ephemeral than the emotional, charismatic appeal of a Steve Jobs, a Larry Page, or a Mark Zuckerberg.

Like a good strategy or vision statement, an effective shared purpose articulates how a group will position itself in relation to competitors and partners—and what key contributions to customers and society will define its success. Kaiser Permanente’s Value Compass, for example, succinctly defines the organization’s shared purpose this way: “Best quality, best service, most affordable, best place to work.”

This shared purpose is not an expression of a company’s enduring essence—it’s a description of what everyone in the organization is trying to do. It guides efforts at all levels of Kaiser: from top management’s business strategy, to joint planning by the company’s unique labor-management partnership, right down to unit-based teams’ work on process improvement. In that regard, Value Compass is less a vision than a recognition of the challenges that every member of the group has the responsibility to meet every day. (See the sidebar “A Collaborative Dance at Kaiser Permanente.”)

Leaders often have trouble articulating such a purpose, falling back on either lofty truisms (“We will delight our customers”) or simple financial targets (“We will grow revenues by 20% a year”). Indeed, the development of a common purpose can be a long, complex process.

For instance, IBM, which needed to reorient its employees from a focus on selling “big iron” in the 1990s, spent a decade building a shared understanding of integrated solutions and on-demand customer focus that went beyond simplistic rhetoric. For many years middle managers and technical employees had found it difficult to frame these concepts in practical terms. They didn’t understand at an operational level what it meant for the company to offer not just its own products but those of other vendors—and to sell customers not simply what IBM offered but exactly what they needed when they needed it. Today these common purposes have become part of the language shared daily by people from different functions and at various levels of IBM as they face challenges together.

Properly understood, a shared purpose is a powerful organizing principle. Take, for example, e-Solutions, a unit of about 150 people formed in April 2000 within the cash-management division of Citibank to address a competitive threat from AOL, whose customers were already banking, trading stocks, and buying mutual funds online. To meet this challenge, Citibank sought to boost the growth rate of its core cash-management and trade business from 4% to roughly 20%.

But that was just the business goal. The common purpose behind that number was the aspiration to be a leader in creating new and complex online banking products that could be tailored rapidly to customers’ needs. To fully grasp this purpose required widespread discussion and a shared understanding of the company’s competitive position within the industry, the evolution of customer needs, and the distinctive capabilities of the organization.

A shared purpose is not the verbiage on a poster or in a document, and it doesn’t come via charismatic leaders’ pronouncements.

A shared purpose is not the verbiage on a poster or in a document, and it doesn’t come via charismatic leaders’ pronouncements. It is multidimensional, practical, and constantly enriched in debates about concrete problems. Therefore, when we asked managers at e-Solutions why they worked on a given project, they did not answer “Because that’s my job” or “That’s where the money is.” They talked instead about how the project would advance the shared purpose.

An Ethic of Contribution

Collaborative communities share a distinctive set of values, which we call an ethic of contribution. It accords the highest value to people who look beyond their specific roles and advance the common purpose.

Paul Adler is a professor of management and organization at the Marshall School of Business of the University of Southern California, where he holds the Harold Quinton Chair in Business Policy.

Charles Heckscher is a professor at Rutgers University’s School of Management and Labor Relations and director of the Center for Organizational Learning and Transformation.

Laurence Prusak is an independent consultant who teaches in the Information and Knowledge Strategy program at Columbia University.


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