In the first article of this series, we explored why collaboration has become a hot topic in modern business and government. In this second article, we’ll dive deeper into the processes behind collaboration, explaining how industry and government are using collaboration to avoid pain and pursue gain. Collaboration isn’t just a buzzword—it’s a necessary tool for improving efficiency, fostering innovation, and ultimately saving costs. So why has collaboration gained so much traction?
From Aristippus of Cyrene to Sigmund Freud and even modern-day motivational coach Tony Robbins, the idea that we are motivated by the need to reduce suffering and increase satisfaction remains central to how we make choices.
The Foundation: Avoiding Pain
In today’s commercial world, the way we relate to each other—whether it’s between governments or businesses—is often marked by friction, pain, and inefficiency. This is primarily due to the reliance on traditional commercial instruments like contracts and litigation, which, while necessary, often lead to disputes and conflict.
In the building industry, for example, BuildingSMART Australia highlighted a significant cultural and behavioural barrier to greater collaboration, “Complacency and a culture of litigation and dispute create a low-trust environment.”1 With Australian governments planning to spend $248 billion on construction projects over the next four years, the costs of disputes are staggering. The average costs of resolving these disputes alone are over $6.45 billion, and that doesn’t account for the long-term financial impact on both the private and public sectors.
Further compounding the issue, CRUX’s 2021 report found that disputes consume about 3% of the total infrastructure project costs, leading to delays of 10-25%. Additionally, procurement models used in construction and engineering are estimated to reduce project productivity by more than 30% due to non-collaborative processes.
One example of how collaboration can reduce costs and mitigate risk is seen in the F-111 program. During the development and later stages of maintaining the F-111 fighter aircraft, the project faced significant challenges due to technical and operational limitations. However, through collaboration between the Department of Defence, the contractor (primarily Boeing), and various defence contractors, a key element of the aircraft’s overhaul—its avionics system—was able to be significantly upgraded.
By integrating various technical and operational stakeholders in an open and collaborative model, the program saved millions in project overruns and developed more efficient solutions for the fighter’s lifecycle management. The key to this success was the transparent communication channels established early on, and a shared commitment to the overall performance of the aircraft, rather than individual goals or profits.
The Benefits of Collaboration
So, how do we move from this painful and inefficient reality to one that is more collaborative and productive? Collaboration is a proven solution, with evidence showing that it reduces conflicts and delays, enhances innovation, and streamlines decision-making.
One of the key advantages of collaboration in the construction industry is the use of collaborative contracts. These contracts aim to break down the adversarial relationships that often characterise project partnerships, instead fostering a shared commitment to project success. A study by ABAB ITC (2021) found that collaborative contracts can eliminate up to 30% of wasted effort in construction activities.2
Collaborations reduce conflict and delays, enhance innovation and effectiveness of problem solving, enables continuous improvement, increases trust and the speed of transaction, and creates a 15-25% bottom line improvement.3
A powerful example of the benefits of collaboration can be seen in the Point Wilson Wharf Infrastructure Remediation Project, where industry stakeholders, including Aurecon, Thales, CBP, and Defence, turned initial setbacks into success by committing to a collaborative approach. Despite facing significant hurdles like delays and shifting priorities, the team was able to deliver the project $10 million under budget, completing it 9 months after the original deadline. This success was driven by transparent communication, trust-building efforts, and the signing of a Foundational Charter, which reinforced the collective commitment to project success. The quality of the remediation work was exceptional, with the wharf being restored to pristine condition. This case underscores how collaboration can overcome challenges, improve project outcomes, and reduce costs.
Collaboration also accelerates innovation. Research and science rely on the principle of collaboration, and the sharing of findings is essential to progress. At the Collaborate Innovate Conference (2024), CSIRO executives emphasised that collaboration is central to their work—not just within Cooperative Research Centers (CRCs) but across partnerships such as AquaWatch, SmartSAT, and Cyber Security. These projects demonstrate the immense value of bringing together expertise from government, business, and academia.
In addition, data sharing has become a key enabler of collaborative success. The Australian Climate Service, OrganMatch, and the Digital Atlas of Australia are prime examples where collaboration across sectors allows for the warehousing, sharing, and evaluation of data that would otherwise remain siloed. This interconnected approach is not just useful but necessary for tackling some of the most pressing challenges, such as climate change and national security.
The Dark Side of Collaboration: Challenges and Barriers
Despite the many benefits, collaboration is not without its challenges. For collaboration to succeed, several factors need to be in place, including trust, shared goals, and the right systems for communication and data sharing. However, the cultural and structural barriers to collaboration can be significant.
- Lack of Trust: As noted by BuildingSMART Australia, the construction industry’s reliance on litigation creates a low-trust environment that makes collaboration difficult. Overcoming this requires a cultural shift—a move from a ‘win-lose’ mentality to one that focuses on collective success.
- Misaligned Incentives: Another major challenge in collaborative projects is ensuring that all parties involved have aligned incentives. This often requires careful negotiation and the establishment of clear, mutually beneficial outcomes. One of the key tools in achieving this alignment is the use of joint performance metrics, where success is measured across all stakeholders, rather than by individual performance alone.
- Systemic Barriers: Many organisations are hindered by outdated systems that don’t talk to each other. Government agencies, for example, often face difficulties when their information systems aren’t interoperable. This was starkly evident during the COVID-19 pandemic, where state agencies struggled to collaborate due to incompatible systems, leading to delays in response and ultimately contributing to lives lost.
To overcome these barriers, organisations must invest in technology infrastructure that facilitates seamless data exchange. Additionally, adopting collaborative governance models that prioritise shared leadership and decision-making can help align the interests of diverse stakeholders.
What’s Next for Collaboration?
Looking ahead, the key to successful collaboration lies in addressing the constraints that hold us back. As we’ve seen, collaboration can unlock substantial benefits, but only when the right processes are in place. In our next article, we will explore the specific benefits that organisations seek from collaboration, as well as the boundaries that limit its effectiveness.
Related Articles in the Series:
- Part 1: Bringing Collaboration to Life
- Part 2: The Problem with a Process View of Working Together
- Part 3: A Whole Brain Approach to Collaboration
- Part 4: It seems like everyone is talking about ‘collaboration’!
Footnotes
- Statement by Eric Bugeja, Chairperson, BuildingSMART. Committee Hansard, 14 October 2021, Canberra, p. 42.
- Australasian BIM Advisory Board (ABAB) submission to House of Representatives Standing Committee on Infrastructure, Transport and Cities (ITC), 16 July 2021
- Chakkol, M and Johnson, M (2015). Benefits realization from collaborative working, Warwick Business School.
