One of the biggest challenges for business owners today is figuring out how to keep their business thriving amid increasingly fierce competition. While competitors used to be seen as rivals, nowadays they can become partners—this is what we call business collaboration.
With the right collaboration, businesses can grow faster, reach wider markets, and even create more relevant products. Want to know the benefits and how to do it? Read this article to the end!
What Is Business Collaboration?
According to Indeed, business collaboration is a form of cooperation between two or more parties to achieve a shared goal. This goal can include increasing sales, reaching new markets, creating innovative products, or solving specific business challenges.
Business collaboration can occur internally (between teams or departments within a single company) or externally (between two different businesses that complement each other).
In a collaboration, each party ‘contributes’ its own strengths—whether it’s expertise, networks, resources, or experience. The fundamental principle is to complement each other and share, rather than compete.
Through business collaboration, you can combine ideas, strategies, and assets to create solutions that not only benefit one party but provide mutual advantages. This creates a win–win situation, allowing all parties to grow faster than they would on their own.
Types of Business Collaboration
As mentioned earlier, business collaboration can be carried out internally or externally. Here’s an explanation along with examples of collaboration forms you can implement.
Internal Business Collaboration
Internal collaboration is a form of cooperation between individuals, teams, or departments within a single company to accomplish daily tasks or long-term projects. With the support of technology, this type of collaboration has become more flexible and efficient, even in remote work settings.
1. Instant Messaging
Quick communication through chat apps like WhatsApp or Slack helps coordinate daily tasks even without face-to-face meetings. This speeds up decision-making and maintains workflow rhythm.
2. Video Conferencing
Through platforms like Zoom or Google Meet, teams can discuss matters in real-time even when they’re not in the same location. This is important for maintaining cohesion and ensuring clear work instructions.
3. Online Workspaces
Tools like Trello, Notion, or Asana allow teams to collaborate in a single digital workspace to share ideas, assign tasks, and track project progress.
4. Cloud Sharing
Using services like Google Drive or Dropbox allows teams to store and edit files together in real-time. This prevents miscommunication and speeds up cross-department collaboration.
5. ERP Systems
Enterprise Resource Planning (ERP) is a management system that connects various parts of a business on a single integrated platform. With ERP, collaboration between teams becomes smoother because everyone works with the same data in real time.
External Business Collaboration
External collaboration is cooperation between a business and parties outside the company. This could include vendors, suppliers, communities, or even competitors. The forms of collaboration vary, and the chosen type should align with the desired goals, scale, and duration.
1. Alliances
An alliance is a short-term collaboration between two or more companies that complement each other in terms of knowledge, resources, or market access to achieve specific goals that are difficult to reach alone.
Example: Burgreens (a healthy food restaurant) once collaborated with Green Rebel (a plant-based meat producer) to create a special plant-based menu.
2. Co-opetition
Co-opetition combines the words ‘cooperation’ and ‘competition,’ referring to collaboration between businesses that are actually competitors. Although it may sound unusual, this type of partnership can save costs, accelerate innovation, and expand market reach.
Example: Local fashion brands Cottonink and Sejauh Mata Memandang once jointly launched the #IndonesiaTanpaSampah campaign to raise consumer awareness about eco-friendly products.
3. Portfolio Collaboration
This type of collaboration occurs when a large company partners with multiple smaller partners simultaneously in a long-term relationship.
Example: Kopi Tuku collaborates with local coffee farmers from various regions in Indonesia to source raw materials for its outlets. This partnership serves both as an empowerment initiative and an effort to maintain product quality.
4. Community Collaboration
This type of collaboration involves the local community, consumers, or local influencers, and can take the form of educational initiatives, empowerment programs, or social activities.
Example: Sociolla organizes various workshops and events with beauty enthusiast communities and micro-influencers in different cities.
5. Network Collaboration
This type of collaboration involves several businesses that share aligned goals and values. They form a network to exchange information, opportunities, and resources.
Example: Google for Startups, which creates business incubators for startups in various countries to share technology, training, and access to investors.
6. Ecosystem Collaboration
This is a form of long-term, interdependent collaboration. Businesses within this ecosystem share innovations, technology, or infrastructure to grow together.
Example: eFishery, an aquaculture technology startup, builds a business ecosystem with fish farmers, feed suppliers, financial partners, and buyers of the harvest. Each party in this ecosystem is connected through eFishery’s digital platform.
Why Is Business Collaboration Important for SMEs?
In the midst of increasingly competitive and fluctuating markets, SMEs are required to continuously innovate and adapt. However, limitations in capital, human resources, or market access often pose challenges. Here, business collaboration can serve as a strategic solution—not just to survive, but to thrive.
Here are several benefits of business collaboration that SMEs can experience directly.
- Expanding market reach. By partnering with other businesses or communities, SME products can reach new customers without the need to open new branches or incur high costs.
- Cost savings. Collaboration allows for shared expenses in promotion, procurement, or production, making operations more efficient.
- Enhancing brand competitiveness and credibility. Collaborating with well-known or reputable partners can boost consumer trust in an SME’s brand.
- Driving product or service innovation. Exchanging ideas and expertise with collaboration partners can lead to new products that better meet market needs.
- Access to previously limited resources or technology. Through collaboration, SMEs can leverage systems, tools, or networks that were previously difficult to access independently.
- Boosting customer engagement and loyalty. Unique collaborations can create memorable experiences that bring customers closer to the brand.
- Building a supportive business ecosystem. By continuously networking and collaborating, SMEs can create a business community that supports each other and grows together more rapidly.
Business collaboration certainly offers many benefits, but it also comes with challenges that need to be managed. These include the division of responsibilities, alignment of goals, and management of communication between parties.
To ensure collaboration runs effectively and benefits all parties, you need a reliable business management app like Labamu. With comprehensive features for recording transactions, managing staff, and running marketing campaigns, Labamu helps you keep business collaborations organized and structured. Download the app now on Google Play or the App Store!
