The Synergy of Collaboration

By Ted Garrison

Last month the author examined the benefits of partnering. Here, he distinguishes between "partnering" and "collaboration."

Unfortunately, many in construction have a negative reaction to the idea of "partnering." I believe a major reason for this is that what people call partnering in construction is anything but. Also, admittedly, some people with this opinion may have had an experience with partnering in which the process was executed poorly. Of course, sometimes partnering was simply not the best choice for contracting construction services.

However, the concept I would advocate is "collaboration" - a term that is really more inclusive than partnering. First, all partnering is collaboration, but not all collaboration is partnering. Here, I'll emphasize what I call the "positive impact derived from the synergy of collaboration."

Partnering is a formal relationship. Collaboration is simply working together on a common goal or vision. In transactional relationships each party attempts to maximize its benefit from the transaction, which often leads to confrontation and an adversarial relationship.

In contrast, collaboration is about cooperation and trust. In a collaborative relationship the various stakeholders work together for the benefit of all parties. This is important, as relationships are only sustainable over the long term if the stakeholders create a win-win environment for everyone.

Transactional relationships focus on price. When buyers focus on price the transaction becomes less profitable for the provider. Worse, transactional relationships don't work for the buyer either because quality declines along with the price. Unfortunately, too many buyers that complain about poor quality are still attempting to win by continuing to rely on adversarial transaction relationships. They are doomed to failure.

Of course, some contractors are forced to compete on a low-bid basis, because they work in the public sector or for companies that require competitive bids. In these situations a full partnership is unlikely, but that doesn't mean that collaboration can't or shouldn't be used to benefit stakeholders.

In essence, collaboration is about working together to lower the level of confrontation. Obviously, there are situations where collaboration or even partnering makes sense to everyone. One example might be a buyer negotiating a design-build contract because of a tight schedule

However, collaboration can work in the competitive-bid market, too. For example, the president of a roadbuilding contractor told me the following story. His company bid on a highly competitive project and received the contract by being the low bidder. At their bid price, however, the job wasn't going to be very profitable.

Schedule was important to the municipality, as it had included significant bonuses for early completion. With that in mind, the president directed his people to work with the municipality and do everything they could do to maximize the bonus.

The result was they finished ahead of schedule and earned a higher profit than was in the bid without the bonus. Yet, the best was yet to come. Other municipalities contacted the contractor to perform design-build work on their future projects because they wanted to take advantage of the contractor's ability to meet an aggressive schedule.

In essence, collaboration can be used in all aspects of construction - not just with the client. Everyone can work together to create a more positive situation. This includes contractors working with their employees. This includes general contractors working with their subcontractors and vendors. This includes the contractors working with the design team. All of these relationships offer opportunities for collaboration and improved profits.

The list of possible areas for collaboration is almost endless. However, successful collaboration is about eliminating waste, confrontation and delivering greater value through cooperation. It takes a little innovation, but when it's done right, a company should be able to create a competitive advantage that will result in increased profits.

The level of collaboration obviously depends on the circumstances, but it should be clear the greater the collaboration, the greater the potential benefits for all stakeholders.

Ted Garrison, president of Garrison Associates, is a consultant, author and speaker who works with businesses in the construction industry. He can be reached by email at Growing@TedGarrison.com.