5.1 Why collaborate?


The main reason a company gets involved in collaboration is to try and gain a competitive advantage, which will lead to improved performance of its business. Following this line of thinking, collaboration activities can be categorized into three broad areas: co-development, co-production and co-distribution.

  • Co-development: a company identifies an area of knowledge or a technique that would be beneficial to the development of new products or services for its business. They then seek out a partner with this knowledge or capability and, through collaboration, take advantage of the expertise of the partner.
  • Co-production: a company has identified a business opportunity but has insufficient capacity or process capability to make parts or to satisfy demand. Seeking out a partner with capacity to spare or with the process knowledge not available in-house, it works with them to provide either an increased quantity or wider range of products or services.
  • Co-distribution: a company requires access to new markets in order to expand. By working with a partner, it gets access to markets in which the latter has already got a means of distribution. Together they can offer a wider portfolio of products and services for distribution in these markets.
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