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Enterprise collaboration, cartels and confidentiality

This article appears in the issue October 2014, [Vol 23 Issue 9]
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When I was returning from Europe, I read “Why Collaborating with the Competition Can Make Business Sense” in The Guardian. (See http://bit.ly/1kIFVMu.) The author of the Guardian article is David Grayson, director of the Doughty Centre for Corporate Responsibility at Cranfield University School of Management.

The headline was intriguing. Competitors who get too chummy can cook up no-poaching deals like the one bedeviling Adobe, Apple, Intel and Google. Forbes has a useful description of this collaborative misadventure. (See “Karl Marx Warned Us Against the Apple Google No-Poaching Agreements,” http://onforb.es/1AjyQFm.) The reference to Marx is a signal that collaboration may be entering an icy patch on the information superhighway.

For Grayson, history, it seems, is on the side of the collaborationists. The article references medieval guilds, pointing out that “businesses banding together to learn from each other is nothing new.” The article explains that “corporate responsibility coalitions” have been productive. Collaboration with suppliers can “improve the profitability and sustainability of their extended supply chains.”

The Guardian’s story references knowledge sharing platforms: “Major companies are using technology to improve the profitability and sustainability of their extended supply chains. For example, 2degrees, an online community for sustainability professionals, provides knowledge sharing platforms for companies such as Tesco and Asda (a Wal-Mart subsidiary). These have virtual meeting spaces, online matchmaking between people seeking solutions and solutions providers, and virtual libraries of practical knowledge and contacts. They are backed up with sophisticated user profiles of participating suppliers and individual employees. Companies from different sectors can find synergies: Barclays and GSK, for example, recently announced a partnership to provide financing for medicines in low-income African markets. In some cases, companies are collaborating with competitors as well as NGOs and public sector bodies, to address specific problems. Refrigerants Naturally, for example, brings together Coca-Cola, Pepsico, as well as Red Bull and Unilever in an alliance with Greenpeace and Unep to develop more sustainable refrigeration technologies.”

Collaborative kahuna

Have the pasteboard walls between competitors outlived their usefulness? Where do Instagram or Google Plus figure in The Guardian’s collaborative datasphere? Has modern real-time communication helped foster a 21st century version of Vanderbilt-Gould business practices? The Nation magazine pointed out that there seems to be a “cultural and intellectual reclamation of the gilded age tycoonery.” (See Steve Fraser, “The Misunderstood Robber Baron: On Cornelius Vanderbilt, http://bit.ly/VrSG1u.) I would offer a tentative “yes.” In addition to the cultural change, social media and collaboration are reshaping the intellectual view of information flows.

There may be some systemic naïveté in business. Let me give an example. At a meeting I attended in August, an investment banker made a startling statement. He told me: “In the first quarter of 2014, Microsoft’s enterprise collaboration business was larger than Cisco’s.”

He explained that Microsoft’s revenue came from unified communications (UC). The word “unified” is apt. In order for employees to collaborate, traditionally separate services have to work in a cohesive, integrated manner. The idea that Microsoft was the Big Kahuna of collaboration made sense. SharePoint is a knowledge management system. Microsoft has Skype and a wide range of knowledge-centric services spanning cloud storage to search and retrieval.

After the meeting, I did a bit of online searching, and I learned that the investment banker was recycling information from Network World. The story that contained most of the investment banker’s information was “A First: Microsoft Pulls in More from Enterprise Collaboration than Cisco.” (See networkworld.com/article/2358682/collaboration-social/a-first-microsoft-pulls-in-more-from-enterprise-collaboration-than-cisco.html?entrprsid=579&userId=2875267.) The article states: “Microsoft was helped by the fact that the strongest growth segment was enterprise social networks, up 34 percent over last year … Microsoft is growing strongly in that area with its proliferation of Yammer.”

According to Network World, the most rapidly growing segment of the enterprise collaboration market is social networking with a “year-on-year growth of 34 percent.”

Big business

Network World identified the other major players: IBM, Avaya and Polycom. Many knowledge management systems provide collaborative tools. Examples range from Atlassian Confluence to ZyLAB. KMWorld provides an annual list of 100 Companies That Matter. Many of them offer collaborative features or make integration with collaboration services an almost painless add-on. Collaboration is a big business. But will there be increased regulatory friction that tries to articulate rules for the collaboration interchange?

I have a copy of the document from the year 2000 entitled “Antitrust Guidelines for Collaborations Among Competitors.” (See http://1.usa.gov/SWyWll.) It was the joint work of the U.S. Federal Trade Commission and the U.S. Department of Justice. One of the main ideas of the 39-page document is that: “In order to compete in modern markets, competitors sometimes need to collaborate.”

Written 15 years ago, the government professionals responsible for the document were taking a common sense approach to competitor collaboration. A quick look at the DOJ Antitrust Division Guidelines and Policy Statements reveals links to the 2008 Antitrust Division Manual and then various documents from 1995 to 2013. A few clicks and some browsing of source documents make it clear that competitor collaboration is a topic woven from intellectual spider webs. Perched in the middle of the Web was Lady Justice. Litigation was possible if an enforcement officer took umbrage at an instance of competitor collaboration that was out of bounds.

New Zealand has been working for a number of years to spell out Competitor Collaboration Guidelines. A draft can be found at the New Zealand Commerce Commission website (comcom.govt.nz). I am not a citizen of New Zealand, and I am not a lawyer. The notion of creating exemptions in the New Zealand Cartels and Other Matters regulations seems a difficult task even for lawyers and advisers.

Standard operating procedure

Reality may not be cooperating with legal rhetoric. A few years ago, the University of Virginia had an honor code that prohibited collaboration among students for some academic pursuits. When I visited the campus a few years ago, collaboration was visible. Mobile devices, laptops and tablets were connected to Facebook and other social sites. Old-fashioned collaboration added several decibels to the library reading room. Regardless of the “rules,” collaboration was as evident as the green grass of the grounds. Is it possible for a researcher to author a journal article without co-authors? My impression is that collaboration among academics is standard operating procedure for certain peer-reviewed periodicals.

Is it a surprise that enterprise collaboration may be ubiquitous in the near future? Consultants often state the obvious. Consider the Cutter Consortium’s list of enterprise collaboration trends. The list identified some “trends and market developments” that appear frequently in consultants’ reports and entrepreneurs’ sales pitches. By now, most professionals know that the cloud—a 21st century version of timesharing—is the next big thing. Cutter offers what seems to be an obvious view of collaboration in “Mobile Enterprise Collaboration Technology Trends and Market Developments” (http://blog.cutter.com/2014/07/29/mobile-enterprise-collaboration-technology-trends-and-market-developments): “Employees naturally want to be able to use their mobile devices to connect with the enterprise social network to collaborate with colleagues, exchange comments, and access and share documents. In addition, integration of mobile collaboration tools with the enterprise social network offers a useful way for organizations to harvest employee feedback in order to determine what workers like and dislike about their mobile collaboration tools. To meet this demand, mobile collaboration providers are developing their own social integration capabilities as well as partnering with enterprise social network providers.”

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