Danger Zones

You'd never begin a walking tour of a new city without first asking about dangerous neighbourhoods, nor would you pack for a trip to an exotic destination without checking on the climate and terrain. Likewise, if you're aware of the dangers that can waylay collaborators, you'll be in a better position to plan a sensible route to avoid them.

WIN-LOSE MENTALITY AND MISTRUST: One of the biggest threats to collaboration success is the win-lose mentality embedded in our culture. "Many people in the past assumed that in dealings with other companies the goal was to maximize their own benefits and minimize the benefits of the other party," says MIT's Malone. And that attitude applies not just to direct competitors, but even in many cases to dealings with customers and suppliers. "When you have that mental model, it's hard to collaborate effectively," he says.

P&G's Jeff Weedman, vice president of external business development, once negotiated a deal with another company that was weighted heavily in P&G's favour. Although everyone at P&G congratulated him at the time, he now sees it as one of the worst deals he ever did. There was so little value on the other side that the collaborating company backed out as soon as another more attractive opportunity came along.

Companies with a win-lose orientation tend to view all of their internal information as highly proprietary when in fact some of it might be safely - and profitably - shared in collaborative ventures. "It's easy to get paranoid and say you're not going to share," says M Eric Johnson, professor and director of the Centre for Digital Strategies at Dartmouth's Tuck School of Business. It starts at the top. If executives on both sides don't quite trust each other, "the whole process is constantly being slowed by cautiousness", says Johnson.

INTELLECTUAL PROPERTY OWNERSHIP DISPUTES: One of the thorniest challenges in B2B collaboration is how to divvy up ownership of any resulting intellectual property. Although a collaboration between Hewlett-Packard and Canon produced the highly successful laser jet printer, Canon put a strain on the relationship when it began marketing its own laser jet, says Johnson. If you don't work out IP ownership ahead of time, it might strain the collaboration or constrict the free flow of ideas between companies.

On the other hand, placing too much emphasis on IP ownership can have an equally chilling effect. "Having lawyers drive collaborative initiatives is like having drunk drivers drive Volvos on New Year's Eve in The Rocks," says Michael Schrage, co-director of the MIT Media Lab's eMarkets Initiative and author of No More Teams! "That's an algorithm for tragedy. The fruits of IP are very, very important. But we need to design B2B collaboration interactions in a way where co-licensing is understood to be of mutual benefit. If you constantly believe that IP is the critical thing, you probably shouldn't be collaborating."

INSECURITY: Companies should be rightly concerned about sharing data with would-be collaborators that have not invested adequately in security. "A lot of big OEM firms have spent a lot of money on security," says Johnson. "They're like the guys in bullet-proof Cadillacs in the inner city. But as soon as they step out into the supply base, they find a much different story." And even if a potential partner has shipshape security, many companies are leery of having any of their data stored on someone else's servers because they can't control what happens to it. "You don't want your data on another network because you're not sure who has access," says Rene Nibbelke, program manager of e-collaboration at aerospace and defence heavyweight BAE Systems.

INTEGRATION HASSLES: Even if companies overcome the security concerns, there remains the challenge of configuring systems to share data and talk to one another. Web services has a lot of potential, but it's by no means a magic bullet. "We use Web services today, and the intent is to help people solve [integration] problems," says Scott Thompson, executive vice president at Inovant, Visa's IT organization responsible for transaction processing. "But you still have to do collaboration and have security people from both organizations agree" on how they'll work around the security measures and firewalls that each has in place. The bottom line is companies that want to share data must slog through the integration quagmire, and wrestle with nitty-gritty details like incompatible data definitions as well as security issues.

Incompatible data can be an integration - and collaboration - showstopper. Thompson says Visa has in the past had to walk away from what he calls "really great product ideas" proposed by would-be collaborators because the two organizations couldn't resolve technical or security differences. And the source of contention can be something as simple as the maximum allowable size of a message field. "When you see something you know could work and should work but you can't get your technology or security people to agree, it's a shame," says Thompson. "And it probably happens more than you'd think."