The future is networks Professor Henrich Greve from INSEAD believes that companies will need to collaborate with networks of partners to gain access to new knowledge Customers the world over are becoming more sophisticated and, as a result, so too are the products and services they require That means that in order to bring new and innovative offerings to market, companies must draw on a wider base of knowledge than ever before And while companies can extend their own knowledge to a degree, they can also partner with organisations with other specialisations to benefit from their knowledge As he explains in this interview with The Economist Intelligence Unit (EIU), Henrich Greve, professor of entrepreneurship at business school INSEAD, believes that the need to share knowledge will become so critical that in the future collaboration among networks of partner companies will become the defining mode of work This interview is part of an investigation into the future of work by The Economist Intelligence Unit, sponsored by Ricoh Europe For more, visit http://bit.ly/eiufuturework Professor Henrich Greve INSEAD The EIU: What is the single biggest trend that will shape the way we work in the future? Henrich Greve: That would be working in networks, where you work with people from other organisations What does it mean to work in a network? It means working not really in the traditional way of being a customer or a seller or some other demanding or giving part, but really working more as a partner They will be doing things together, such as research, development, joint production, joint services, sales – pretty much anything that an organisation does could end up being done by a mixture of people from different organisations What are the drivers behind this trend? It’s a combination of firms being less willing and less able to everything they need on their own What firms are discovering is that customers are less receptive to the type of traditional product that relies on one knowledge base Instead, what you see is that the products or services that really well are the ones that blend industries, mix knowledge spheres and shift the boundaries For this, firms need new knowledge, and getting that knowledge inside the firm is hard Increasingly they are turning to collaborations, working together at all stages to make sure that things work An example is the iPhone If you think of all the industries that are inside an iPhone, there are quite a few S P O N S O R E D B Y: How prevalent are networks already? They are already prevalent in some industries Classical examples that we know a lot about are biotechnology and pharmacy, where it is very hard to all of the things that are needed for medication to get to the patient, inside one firm It’s also prevalent in industries that have products that involve electronics or computing devices So I’m not talking about industries that you would traditionally think of as being computer-driven A car has some obvious semiconductors because you will have music-playing and other devices in it, but there are also many - that decide what the engine is doing Of course, if you want to design and put together a car, as a carmaker you’re not going to have the expertise in making or adapting those devices You will need some help from the makers If every vehicle has to have an on-board computer, would it not be more efficient to employ your own people to work on the semiconductor parts of the vehicle? For many of these types of devices there are choices, and I can imagine different firms making different choices They could try and develop that expertise internally One reason for doing it that way is maybe because they find that it is cheaper; maybe they find that there is some advantage to having the expertise internally But the other option is that if you can work well with another firm, then you really don’t need to know the internal parts of that device You don’t have the need for the expert knowledge Instead, what you need to is know how to communicate with people who have that knowledge It’s often easier A lot of people prefer to know how to communicate with accountants rather than learning accountancy The products or services that really well are the ones that blend industries, mix knowledge spheres and shift the boundaries Professor Henrich Greve INSEAD What will the situation look like in ten years? We will see more blends of knowledge that we hadn’t thought possible And we will see new value from that Firms aren’t necessarily going to look all that different, but what is inside them is going to be very different because more and more work is going to be crossing boundaries They are going to have to learn from each other how to design things, they may have to work together to produce things If you think of yourself, as an individual, ten years from now, you might have a lot of conveniences in terms of products and services that are combined in such a way that they add value across fields of knowledge But at the same time you are probably carrying those products on the way to a workplace where you’re going to have a pretty complicated job of interacting with people from one or more other organisations in order to something useful Overall, you see working in networks as a force for good or a force for bad? It’s important for organisations It’s going to be very useful for them to be more flexible in what they offer But it’s going to be pretty challenging for their employees There will be an increase in the number of people whose work will be less structured and less localised They’ll have to move around more, and we’re not sure exactly what the reaction to that will be But I think it’s pretty clear that some people will discover that they shouldn’t be in networked work Then the question is: will the organisation be able to make good separations, so that some people can stay at home at the organisation while others will take on the more challenging roles? To the extent that if it takes a while to discover these things, or to the extent that career incentives push you to be in a network regardless of whether you like it or not, working in networks is not going to be an altogether positive experience There are going to be some minuses But there are also going to be employees who find that working in networked organizations is just right for them S P O N S O R E D B Y: ... they find that it is cheaper; maybe they find that there is some advantage to having the expertise internally But the other option is that if you can work well with another firm, then you really... networked work Then the question is: will the organisation be able to make good separations, so that some people can stay at home at the organisation while others will take on the more challenging... but what is inside them is going to be very different because more and more work is going to be crossing boundaries They are going to have to learn from each other how to design things, they may