Collaboration Curves Improve Innovation and Performance

Point: Unlike the diminishing returns of the Experience Curve, Collaboration Curves offer continuous, exponential improvement and innovation through knowledge sharing and interactions among a group of participants.

Story: Most of us have heard about the Experience Curve, which traces how a company’s rising experience in making a product leads to declining cost of that making a product.  On average, the cost declines 20-30 percent each time that a company’s experience in making that product doubles. The Experience Curve, which has been systematically studied since the 1960s, holds true across a wide range of industries.  The sad flip-side of the Experience Curve, however, is that the rate of improvement declines over time because it takes longer and longer for experience to double.  It has diminishing returns.  Can anything be done to sustain the rate of improvement? Is there another way to keep on advancing? There is: Collaboration Curves.

Collaboration — in the form of knowledge sharing and interactions among a group of participants — improves the performance of all.  Before the internet, collaboration took place primarily face to face, along with some letter-writing between participants.  For example, in the 1870s, the art movement that came to be called Impressionism arose.  A group of young painters — Claude Monet, Pierre Renoir, Camille Pissaro and others — started meeting in cafes, talking and visiting each other’s art studios. They became a collaborative group; that is, they’d share their work in progress, talk about painting techniques, experiment with colors, and help each other learn and improve.

For example, the group broke with the tradition of black shadows.  They experimented with shadows painted in purple, deep blue or a mix of other colors.  Sometimes the shadows weren’t even that dark. This was a radical idea — no one had painted shadows in a different color before, but once one of the group came upon it, others adopted it as well.  They also expanded the notions of what could be painted. The subject matter needn’t be a religious icon, mythological scene, portrait of a nobleman or an allegorical landscape — it could be something as simple as a haystack or water lilies, painted over and over at different times or day or different seasons, showing how the light and color changes with the times and seasons.  Combining their experiences accelerated the Impressionists’ innovations in color, composition, brushwork, and subject matter.

Today, these collaborative groups can extend online, enabling people to talk and share with others anywhere, any time, thereby greatly — indeed exponentially — improving the group’s capacity to produce.  In the old model, the experience of any one person (or company) grew linearly with time, which created an Experience Curve with diminishing returns.  But a collaborating group can multiply experiences by combining lessons from the successes and failures of all to create a Collaboration Curve that sustains performance improvement.  The internet, social media, and collaboration platforms greatly enhance the Collaboration Curve by increasing the number of people who can collaborate, increasing the geographic span of people who can collaborate, and increasing the access to the accumulated experience of the collaborative group.

Collaboration Curves were first identified by John Hagel, who heads consulting firm Deloitte’s Center for the Edge in Silicon Valley.  “We’re seeing the emergence of a new kind of learning curve as we scale connectivity and learning, rather than scaling efficiency,” says Hagel in his Harvard Business Review blog (coauthored with John Seely Brown and Lang Davison).  “Collaboration curves hold the potential to mobilize larger and more diverse groups of participants to innovate and create new value.”

So far, examples of internet-enabled Collaboration Curves are more anecdotal rather than rigorous because of their nascency.  But Hagel has found that collaborative environments like the popular online game World of Warcraft offer participants a way to continue improving beyond what individuals could accomplish alone.  In the business world, similar collaboration curves take place on SAP’s software developer sites, and large open source projects such as the Eclipse Foundation.  What’s exciting is that “Collaboration curves may reverse the diminishing returns dynamics of the experience curve and deliver increasing returns to performance instead,” Hagel says.  The opportunity for interactions among the many participants lets performance continue improving through the continuing contributions of ideas by other participants.

Action: Hagel found that there are three prerequisites for these online collaboration groups to work and generate the Collaboration Curve effect.

  • Attract Participants: First, you need people. That’s pretty obvious, that you need people to make this work. But what’s exciting is that the people don’t all have to be talking or active all the time – it’s perfectly ok to begin by just being an observer who lurks and learns from others. Indeed, in SAP’s software developer network (SAP SDN), most participants do just that — learning by reading the discussion forums before they contribute anything themselves.
  • Interact: to get better results, you start interacting with others, in discussions — in person or online — sharing experiences, making suggestions, giving feedback. The more interactions, the faster the performance improvement.
  • A supportive, multi-layered environment: Supportive means friendly and online.  It also means that the technology supports the interaction through discussion boards, archives, live chats, video.  Interaction must be easy not only among peers but among all cross-cutting groups. Digital infrastructure lowers interaction costs, enabling large, diverse groups of people to share information and learn from each other, driving performance improvements for all.

13 Comments »Growth, How-to, Innovation, Productivity, Social Media

13 Responses to “Collaboration Curves Improve Innovation and Performance”

  1. Louis Galdieri Feb 7th 2012 at 06:07 am 1

    It’s a historical leap from Monet’s cafe meetings to online interactions, and I think it’s worth rewinding and reconsidering. Monet’s get-togethers were regular, in-person encounters, among friends and fellow artists, a moment to see and share, point and touch, around a table, sharing a coffee, a drink and a smoke. There’s something to be said for intimacy and immediacy, and above all for friendship, which is not the same as social “friending” and which, I think, gets short shrift in these discussions. There is an important ethical dimension to friendship — and to cafe life, the cafe table, the Stammtisch — that we all too easily overlook, or conflate with this new ethic of “the social.”

  2. Andrea Meyer Feb 7th 2012 at 09:22 am 2

    Thank you, Louis, you raise a good point. I don’t mean to equate the camaraderie and friendship formed in person among the Impressionists with the learning that goes on in online forums like SAP SDN, but I do think that learning and innovation does occur in online settings. The depth and feel is different (especially for those of us who aren’t digital natives) but online settings do bring an opportunity for people who share a passion for a topic to share their experiences and interact. Also, many more people can share and interact online than could in a physical setting. That opportunity to extend the interaction beyond the cafe is, I think, what turns the Experience Curve on its head. With those expanded interactions among a much wider range of people, learning & performance continue to improve. We go from diminishing returns to increasing returns through that participation, which can now number in the thousands. You’re absolutely right that such online interaction lacks the intimacy of in-person sharing, but it does mean that the co-learners no longer need to live in the same city. The improved learning and innovation that takes place, therefore, can be extended and continuous.

  3. Scott Wagers Feb 9th 2012 at 10:14 am 3

    What Monet, Renoir, and Pissaro had was a strong shared vision. This I believe can supersede friendship. In fact in collaboration and open innovation this is all you have to drive the work forward. Accountability hierarchies typically do not stretch across companies or institutions and they have a nasty habit of demanding the attention of collaborators at the cost to the collaboration. A strong shared vision motivates collaborators to make time for the collaboration and enable them to say “no” to the demands of their accountability hierarchies.

  4. Andrea Meyer Feb 10th 2012 at 10:33 am 4

    Great addition, Scott, to mention the importance of a strong shared vision. Mutually-shared goals – such as believing in the importance drug safety or finding cures for neglected diseases – motivates researchers in biomedicine to collaborate despite being housed in different companies/accountability hierarchies.

  5. kare anderson Feb 17th 2012 at 01:01 pm 5

    What a thoughtful post (again) Andrea, and timely.
    As a fan of John Hagel’s work (recently worked with him at Center for the Edge) I heartily agree with Scott who wrote in his comment about the importance of “a strong shared vision.”

    In fact I believe that it is more important for all participants in the collaboration to share a strong sweet spot of mutual benefit and/or interest (in this increasingly complex yet connected world) than to trust each other.
    Because that shared benefit is more likely to spur the behaviors that inculcate trust rather than the reverse…..
    Actions that build an “us” attitude and belief are crucial to maximizing the opportunities inherent in the Collaboration Curve.

  6. Andrea Meyer Feb 17th 2012 at 02:01 pm 6

    Thank you for your comment, Kare, and how fun that you recently worked with John Hagel. I’ve been a fan of his since his book Net Gain and had the pleasure of talking with him at the two recent Business Innovation Factory conferences (BIF6 & BIF7). He’s a great thinker and a kind, warm person. I’m sure working with him was a pleasure!

    I like your point about shared goals spurring trust and building an “us” attitude. I hadn’t thought about it before, but it’s true that trust doesn’t necessarily have to be a prerequisite – it can be developed through actions that are motivated by the shared vision.

  7. Gail Storey Feb 27th 2012 at 05:36 pm 7

    Thanks for sharing this explanation of the collaboration curve. It would seem to be increasingly relevant as we face a broad spectrum of challenges from economics to the environment.

  8. Andrea Meyer Feb 27th 2012 at 06:03 pm 8

    You’re right, Gail, and in addition to collaborative learning taking place to help us solve the complex problems facing the environment and economy, we can use the same principles to innovate in more daily tasks, like hiking the Pacific Crest Trail (to borrow an example from your blog). People interested in multi-month, long-distance hikes like that could form a collaborative circle around your blog, as you share tips on how to pitch a bedroom in the woods, cook interesting food using only lightweight gear, and so on. The talks you’ve given let people meet in person, and the conversation & learning extends online through your blog.

  9. Mads Singers Mar 1st 2012 at 11:06 am 9

    The best way of improving innovation is to let it happen; way too many companies don’t as they are to focused on the key short term targets.

    Kind Regards

  10. Andrea Meyer Mar 1st 2012 at 11:15 am 10

    It’s true, a short-term focus often crowds out innovation, making it difficult for people to make the connections that innovative leaps require.

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