WESTERVILLE, Ohio–DHL Supply Chain’s latest white paper highlights the emergence of a new collaborative business model. The white paper revealed that most organizations still conduct business as separate entities, interacting transaction by transaction, but the way of doing business is changing and organizations must now meld together to face the market as one. This new approach refers to a collective of organizations aligning on a shared mission and competitive strategy; working together to capitalize on their strengths and overcome weaknesses to deliver customer success.
The new business model is about creating an end-to-end mutually executed process that extracts waste and creates sustained value. Yet, a survey conducted alongside the white paper has revealed that more than 70 percent of businesses are either only starting to explore new partnering models or are still partnering at a transactional level.
‘Business Collective 1.0: Partnering Reborn’ is a white paper by Lisa Harrington, President of the lharrington group LLC that was commissioned by DHL to identify the opportunities available to companies taking on this emerging and transformational business model. A model which is enabled by technology and talent, driven by the speed of business, and necessitated by competition.
“Leading companies are recognizing the need to do business differently. CEOs and supply chain managers are asking one of the most pressing business questions: how can we work together to win in the global marketplace? Many companies are now realizing that thanks to new technologies – combined with new management science – it is possible to identify challenges and develop collective solutions. It is outdated to adopt an inside-out approach to the world of business that is informed only by your own business’s perception and capabilities,” Harrington said.
A survey by DHL confirms that a small number of companies are just beginning to embrace the Business Collective approach but most have a long way to go. Companies typically progress through several stages of maturity as they adopt this new business model. Under the old transactional model, companies approached business from an ‘inside-out’ perspective with a single lens. The new ‘outside-in’ approach involves partners collaborating to develop a more complete picture of challenges and solutions.
The least mature stage can include an outside expert reviewing operations and providing solutions to streamline it, such as extracting waste at the customer’s facility. DHL’s survey revealed that only 5 percent claim to have reached a fully integrated partnering model with customers. More mature stages can include multiple organizations coming together in recognition of joint capabilities to solve a problem collectively.
“The days where businesses can succeed by interacting transaction by transaction is over. No longer are businesses able to face competition through an “us versus them” lens. The customer is the focal point for the predictive enterprise, and the Business Collective is the means to serve them. By serving customers as a single entity, with a predictive mindset, businesses can create shared benefit for everyone,” said Damian Pike, Vice President, Innovation & Transformation, DHL Supply Chain.
“In a traditional business relationship, waste occurs at the edges where one company stops and another starts. In a business collective, you soften and blur the edges, and in so doing eliminate the waste and cost that stems from boundaries. This move towards a more collaborative business model is just beginning. 74 percent of respondents to our survey are either just starting to explore partnering, or partnering on a transactional basis only – this is a clear sign that businesses must now seize this opportunity and reap the benefits,” he said.