The proposal of model for building cooperation management in company.
Vodak, Josef ; Soviar, Jakub ; Lendel, Viliam 等
Introduction
The topic of managing cooperation activities is currently highly up
to date. In present, cooperation as such represents for a company an
important tool for increasing its competitiveness. Companies aim to
fully utilize their cooperation potential. In order to be successful, it
is needed to effectively manage these activities and to dynamically
react to the ongoing market development.
The process of implementation of cooperation management is
influenced by a number of factors including theoretical concepts as well
as practical applications. Probably the most significant challenge lies
in the fact that there is no universal model available for
implementation of cooperation management in a company.
After conducting interviews with several companies as a part of the
performed empirical research, we have identified a distinct need among
the managers for a model that would support their efforts to build and
implement cooperation management within their organizations. Such a
model would represent benefit not only to the managers of the company
but also to their partners.
The article aims to offer, in an understandable form, a coherent
perspective on the management of cooperation activities in a company as
well as a methodology of managing its cooperation projects. Both of
these would be based on a comprehensive mapping of theoretical and
practical findings in the area of cooperation management as well as the
performed research about its utilization in Slovak enterprises.
1. Objective and methodology
The main goal of this article is to gather and accumulate new
insights in the area of cooperation management and to highlight possible
ways of how it can be effectively established, built and implemented
within a company. The proposed model is meant to be used by the company
managers as a valuable tool for building and implementing cooperation
management within a company.
In order to address the points in question, as set by this article,
it was necessary to use several methods, depending on and fitting to the
character of the individual parts of the solution. In order to
accumulate necessary data, we used the method of document analysis (for
analysis of current as well as historical data about the topic), a
questionnaire method and a method of semi-structured interview
(gathering data in an empirical research) and a method of observation
(used during visits of selected companies).
For data processing we used mainly quantitative evaluation
(statistical methods) and the method of comparison (comparison of the
data obtained from the empirical research and the data from the analysis
of secondary sources).
The performed research focused on medium and large enterprises
active in the Slovak Republic. In total, 273 respondents took part in
the research focused on diagnostics of the level of use of cooperation
management.
Research included companies active in multiple sectors of the
Slovak economy. Included companies were categorized by the Statistical
Office of the Slovak Republic as medium or large enterprises. The actual
respondents were company managers on the mid to top management level
within the managerial hierarchy of companies. Size of the sample was 345
respondents, with the required 95% interval of reliability and the
maximum allowable error of 5%. Since 273 respondents actually took part
in the research, the maximum allowable error reached 5.72%. Data was
gathered exclusively via personal interview.
The methods used for further data processing were induction,
deduction, synthesis (in identification of key success factors for
building cooperation management and in formulation of particular steps
of the proposed model), abstraction and modelling. 2
2. The current state of dealing with the issue
We have identified ongoing scientific discussion about the term
cooperation management and its area of use. This has resulted in several
definitions of cooperation management that are in use and that we
encountered during the review of scientific literature. However, these
definitions typically cover only a certain subpart of the overall role
of cooperation management. High variability in interpretation of the
term can be supported by the following examples. Lafleur (2005)
understands cooperation management as a way of managing and developing
collaboration in a competitive environment. According to Ray (2002),
cooperation management represents a term for integrated management of
company networks. Staatz (1983) sees cooperation management as
cooperative decision making within heterogeneous preferences. He
highlights the need for a model of cooperation based on a defined group
choice. Table 1 summarizes the definitions of the term cooperation
management.
Veerakumaran (2006) summarized the most important characteristics
of cooperation management into the following points:
--Cooperation management is a complex decision making process and
the decisions are made on all managerial levels.
--Primary goal of cooperation management is to satisfy the needs of
the members of cooperation.
--All activities need to occur according to the agreed principles
of management and cooperation.
--Suitable balance needs to be established between the efforts for
commercial success and maintaining goals of the cooperating parties.
--Management focused on reaching a goal via effective use of
resources.
Based on the performed detailed analysis, as described above, we
can define a more precise definition of this term:
Cooperation management is effective and efficient management of
relationships in a cooperation between separate and relatively
independent organizations or individuals, with the goal of improving
their competitiveness (Soviar 2012; Vodak et al. 2013).
In the analysis of scientific literature we also looked at
indications of the key success factors of building cooperation
management in a company.
Building of relationships based on cooperation and having the
following attributes (Ramanauskiene, Ramanauskas 2006; Lydeka,
Adomavicius 2007; Malakauskaite, Navickas 2010, 2011; Gumilar et al.
2011): Cooperation and partnership; Seriousness; Non-disturbance of
mutual competitive relationships; Focusing particularly on long-term
time horizons --long-term cooperation.
To build cooperation management in a company is a real challenge
that company managers need to deal with. There is a number of factors
that influence the process of establishing cooperation management.
Sahut and Peris-Ortiz (2014) emphasized the role of innovations in
the process of building cooperation management in a company. They
consider it essential to create a favorable environment for
entrepreneurship and innovations. Such environment is often
characterized by determination and close relationship between the
cooperating parties.
Another important factor for building cooperation management is
trust between the partner organizations. Of particular importance is the
gradual adaptation of business cultures of the partner companies (Weck,
Ivanova 2013). The need for informational background for cooperation
processes is listed by Monczka et al. (1998). To enable effective
management of cooperation processes, it is necessary to ensure quality
information within the company and to enable its sharing for the
decision making needs of the managers. Effective work with information
within cooperation can help to prevent conflicts as well as to enable
dealing with challenging cooperation activities. Importance of
organizational factors for building cooperation management was
emphasized by Jassawalla and Sashittal (1998). These involve changes in
the organizational structure to support cooperation, interested and
support of top management of the partner companies, openness to changes
while maintaining mutual goals of the partners.
Assuming that the abovementioned identified factors are taken care
of within a company, then its cooperation management will bring expected
results, such as better product quality, shorter delivery times and
higher customer satisfaction (Valenzuela, Villacorta 1999).
Based on the performed analysis and evaluation of various
approaches to managing company cooperation activities, as presented by
multiple authors, we are able to proceed to systematization of these
findings. Here we provide a summary of the main contributions of each
approach to managing cooperation activities. These represent a basis of
the proposal of model for building cooperation management in a company
(Table 2).
3. Situation in Slovak enterprises - results of the empirical
research
Between September 2012 and February 2013 we conducted a research,
with the primary goal to gather and interpret information about the
level of use of cooperations in the environment of Slovak enterprises.
The main goal of the research was to identify the key aspects of
efficient management and functioning of cooperations, related issues,
degree of satisfaction of companies within cooperation and the
opportunities for improvement of already functioning cooperations. Data
that was gathered provided complete picture about readiness of Slovak
enterprises to use (implement) cooperation management. In total, 273
managers of small, medium and large enterprises took part in the
research, from companies active in Slovak republic. Data from the
respondents was gathered via personal interviews. Table below provides
overview of the main results for the individual researched areas.
[FIGURE 1 OMITTED]
Managers had a list of key success factors related to the use of
cooperation management in a company at their disposal. Managers were
asked to assign the level of importance to the listed success factors,
i.e. to express their priorities. The managers put the highest priority
on the factor of mutual trust (9.35) and adherence to contractual terms
(9.35), followed by the impact of cooperation (8.94). In contrast,
managers assigned low priority to the level of communication (8.52) and
even more significantly to the information system (7.62).
Representatives of the companies included in the research had also
the opportunity to comment on the factors that they consider important
(or unimportant) for the process of selection of a potential partner
company. They expressed their opinion on the scale from 1 to 10, with 1
representing an "unimportant" factor and 10 representing an
"extremely important" factor. As shown in Figure 1 below, when
representatives of the selected companies consider collaboration with
another company or an organization, they mostly look at the
partner's position on the market, certification, references,
profitability, insolvency and potential costs of future cooperation. A
legal form of the partner is the company attribute with the lowest
importance.
4. Model for building cooperation management
The model for building cooperation management in a company should
comprise the sources of information, concepts as well as the resources
necessary for implementation, building and support of cooperation
relationships. Based on that, the main goals of this model are as
follows:
--to build successful and trouble-free cooperation management in a
company,
--to establish and build long term relationships with partners,
--to improve the ability of a company to attract and sustain
cooperation,
--to achieve improved information flows in a company,
--to reduce loses of partners,
--to gain the improved access to information about the market and
competition,
--to improve satisfaction and loyalty of partners (exceed
expectations) gradually,
--to increase commercial activities with new partners,
--to lower the costs of cooperation (efficient and performing
operations),
--to maximize cooperation opportunities (services available,
references etc.),
--to identify inefficient cooperation processes,
--to achieve long term profitability and competitiveness.
The model for building cooperation management in a company connects
managing of cooperation relationships, creating and managing of
cooperation activities and utilization of relationship management.
Cooperation management integrates new strategic initiatives of
partner communication and creates a common communication platform. The
use of the management theory and the relationship management for
creating of a model of cooperation management is definitely necessary.
This is due to the fact that managing of relationships with partners is
not only a matter of representing a relationship but an important part
of supporting the understanding of management and development of
relationships and communication.
When creating the model for building cooperation management in a
company, it is necessary to select the structural (construction)
components of the model so that they demonstrate that it is still a
model but also they would ensure its implementation. By the fact that we
have constructed a theoretical model, we gave a priority to the
functionality and implementation as opposed to the strategy of creation,
but without the actual elimination of this strategy.
In order for the proposed model to function successfully, it is
necessary to ensure balance and integration of technology, processes and
people. These aspects are closely related to the company strategy,
technology and integration processes in a company as well as to the
orientation towards cooperation.
[FIGURE 2 OMITTED]
In relation to the opinions of multiple authors active in the field
of creating a model of cooperation management in a company, we propose
the model comprising the following major elements (Fig. 2):
1. Evaluation of the initial situation
2. Creation of the cooperation strategy
3. Formation of cooperation management
4. Definition of the position of the company and its employees
within the cooperation
5. Establishing of continuous information flows
6. Creation of a company system for work with cooperation ideas,
opportunities and relationships
7. Implementation of organizational changes
8. Implementation of changes in mindsets
9. Management of cooperation processes
10. Cooperation performance evaluation
As part of implementation planning of cooperation management, it is
important to clearly define goals of the project and to define a model
of metrics. These should enable monitoring, control and evaluation of
the effects of the project, enable determining responsibility for
project results and, last but not least, enable company to determine a
timeframe for evaluation of the project success. Also, as part of the
cooperation management planning, the company should identify a top
management member who will ensure necessary managerial and financial
support for the duration of the whole project. The next step is to
appoint a project leader and to create a group of project users. It is
important that the whole process of cooperation management
implementation is planned in detail. Cooperation strategy needs to stem
from the company strategy. Within the strategy, the model of managing
cooperation relationships should be defined, including the model of
cooperation processes, description of architecture for particular
processes and their information ties and technological, practical and
data integration, i.e. ties to the surrounding company environment.
Before the company actually takes the first steps in building of
cooperation management, it is essential to conduct a detailed and
thorough analysis of processes related to the cooperation. The company
could take advantage of a tool "map of cooperation processes
conditions", within which we distinguish three types of processes.
These are disconnected processes, processes in a pragmatic phase and
integrated processes. The goal of such analysis would be to evaluate the
necessity to revise the current processes. In general, the company ought
to strive for minimization of disconnected processes or towards their
conversion into integrated processes. The performed analysis should be
based on the opinions of partners and key employees who share certain
relevance to the missing processes related to cooperation. At this
stage, it is crucial that the top management is also involved in order
to ensure execution of the required changes. Priority should be assigned
to the missing processes and a plan should be drafted so that these
processes can be established. Identification of processes related to
cooperation constitutes a basic and necessary requirement for successful
building of cooperation management within a company. Last step is
evaluation of cooperation performance. Within this step is evaluated the
management of cooperation itself. There are two crucial elements
considering this evaluation. First one: It is necessary that this
evaluation will be carried out on a regular basis. Second one: It is
necessary that evaluation findings will be appropriately incorporated
into the whole process (considering also the previous steps). Following
the above is our proposed model based on systematic improvement
(considering the evaluation feedback). An organization (companies,
public offices, etc.) could learn following the procedure of established
cooperation and thus improve its management.
5. Discussion
Before the building of cooperation management in a company actually
starts, an audit of current situation should be performed. The audit
would comprise identification and analysis of employees' skills,
incorrect decisions, failures, competition, partners and company needs
related to the implementation of the cooperation management:
--the analysis of the environment (external analysis the
environment outside the company),
--the analysis within the company (internal analysis the structure
inside the company).
The analysis should focus especially on the following four aspects:
the environment and market, internal company processes, information
flows within the company, information systems used in the company.
Cooperation strategy represents a sum of strategic decisions that
are used as a basis for implementing of cooperation management in a
company. Further decisions about the need to innovate cooperation
relationships of the company are based on the cooperation strategy.
However, this decision is considered only in the case that the current
condition of cooperation relationships does not correspond with the
desired state of things. Creation of the cooperation strategy focuses on
the following key issues:
--What is the current situation in the company like and what does
the company aim to reach by its activities?
--Who are target partners of the company and how should they be
involved in the company's cooperation activities?
The cooperation strategy needs to be aligned with the company
strategy and other partners. The main role of the cooperation strategy
is to select partners and to define their characteristics, cooperation
opportunities and areas of potential cooperation. However, before that
it is needed to perform a thorough analysis of current and potential
partners and consequently to select the most suitable structure.
In the model, the element of a partner is a central piece and bears
significant importance for full functioning of the model. This element
accentuates the need to create a concept of cooperation management in a
company. This means that the company needs to have an action plan ready
defining how it will act in relation to its partners. It needs to
designate the methods using which the relationships will be built and
how the communication among partners will be carried out. The company
should have the following processes ready, drafted and detailed:
--creation of cooperation activities according to the needs of
partners,
--establishing of cooperation relationships with partners using
suitable managerial communication,
--processing and evaluation of cooperation activities
(initiatives),
--development of cooperation relationships with partners.
Company employees should think about the ways that they can
contribute to the improvement of cooperation relationships. These
components of the model act as a system for maintaining functionality of
the whole cooperation management. In it, employees prepare the analysis
of a situation, formulate cooperation strategy and action steps and
define control mechanisms for efficiency and effectiveness.
It is necessary to keep company employees and partners informed.
The company employees are very sensitive to the ongoing changes that
happen as a result of implementation of cooperation management and
execution of cooperation activities. In order for the employees to
correctly grasp and fully utilize the gains brought by the cooperation,
they need to be informed in depth (e.g. in a form of seminars) and
prepared for the planned changes. It is also important to involve the
employees of the partner entities in such efforts.
To achieve successful and smooth building of cooperation management
and its consequent use in a company, it is necessary to ensure the
effective use of information. The company should aim to build such a
system that would enable all participants of collaboration to have the
access to all information they need in order to be able to fulfill their
tasks. Partners need to have the access to all available data about
their cooperation initiatives. When preparing cooperation ideas and
plans, the employees should have the access to the complete history of
cooperation activities, information about cooperation opportunities,
references etc. The information tool in cooperation should allow the
automatic access to the needed information and automatically save the
data related to cooperation (the ideas, opportunities, activities,
initiatives, relationships etc.) into a comprehensive database. This can
be achieved only when the company provides efficient work with
information.
Effective system for managing cooperation ideas, knowledge and
relationships is one of the basic preconditions for successful
implementation and use of cooperation management in a company. The
proposed system is based on a marketing information system and was
expanded with additional four specific modules:
--knowledge management module,
--module for work with cooperation ideas,
--module for work with cooperation opportunities,
--module for work with cooperation relationships.
If the company top management wants to manage such changes
successfully, it is necessary to carry out the following processes in
the company:
To create a vision of organizational changes: as the first step, it
is necessary to identify all company ties and to consider the
organizational structure. Based on the resulting information we can
define the requirements for change
To prepare for organizational changes: as the second step, it is
necessary to ensure the availability of knowledge required for the
change, including necessary resources (financial, personal) and to
prepare a plan for the change
To implement organizational changes: as the third step, it is
necessary to improve communication with the employees and to explain the
reasons for the change. The changes need to be monitored continuously
and their success needs to be evaluated continuously.
The newly created organizational structure should support the
modifications of the company to reflect the needs of the partners. This
means there needs to be a flexible response to the requirements of the
partners. The organizational structure should be aligned with the
cooperation strategy.
In order for the realized organizational change to bring the
desired effect, a certain change in mindsets should occur. The companies
that wish to be successful should not focus narrowly only on their
goals. They should also take into account the results of their actions,
once the goal is achieved. The change in mindsets represents a change of
the perspective on collaboration of the company with its partners. It is
necessary to make a shift from the view primarily focused on the
individual contracts towards the view of collaborations from a long-term
perspective. This is possible by shifting the mindset from seeing only
the goal to seeing also the results of the actions.
As part of the cooperation, every company ought to be interested in
the relationship with its partners. This is based on trust and mutual
respect. If it happens that the trust is broken, this leads to a
disrupted relationship and will negatively reflect on the performance of
the company. It occurs in several cases that cooperation runs according
to the company regulations, which are not identical with the
requirements of the partners.
In order for the company to fully utilize all advantages of
cooperation management, it needs to abandon the concept of being focused
solely on reaching its goals. This does not mean that the company should
stop being interested in such goals. The change is in that the company
starts to perceive also the effects that materialize after the goals
have been reached. The orientation towards the results enables the
company to freely adjust and change its goals so that they keep bringing
the desired results.
There are also possibilities to use cooperation management main
processes and ideas to build competitive and effective organizational
structures in regional development (Stofkova, K., Stofkova, J. 2011), in
public transportations systems (Stopka et al. 2014), etc.
Company processes related to cooperation activities can be managed
only when the company possesses profound knowledge about them--knows
them, has them described, is aware of the qualitative and quantitative
parameters of the processes using which they are evaluated, e.g. process
analysis. Processes need to have their owners assigned and their inputs
and outputs defined. In case that company processes do not bring the
expected outcomes or are not sufficiently oriented towards cooperation,
managers should consider modification and improvement of such
cooperation processes.
Conclusions
To implement the elements of cooperation management in a company is
a complex process with ties to almost all aspects of a company. It
includes organizational changes, re-engineering of processes as well as
accumulation, analysis and use of data related to the cooperation. Key
success factors for building and using cooperation management in a
company include the following:
--strategy and planning,
--revision of company processes,
--changes to the organizational structure,
--changes to mindsets,
--effective work with information,
--cooperation database,
--sharing information with company employees and partners.
Business strategies that do not recognize the presence of
complexity and uncertainty with related and future changes will be
inflexible and unlikely to be correct (Varmus 2009).
For organizations that aim to be not only successful but also to
ensure survival cooperation management represents a solution that will
enable quick review of the market and will bring value into the
enterprises for a long-term period. A company needs to manage the
relationships and communication with its partners efficiently. Only with
the help of continuous improvements to common projects and active
communication a company will be able to retain its partners. The
proposed model for building cooperation management in a company serves
this purpose.
http://dx.doi.org/10.3846/btp.2015.535
Acknowledgements
This paper was supported by the Slovak scientific grant VEGA
1/0621/14 Marketing management in cooperative environment--Proposal of
strategic cooperation management implementation model.
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Josef VODAK (1), Jakub SOVIAR (2), Viliam LENDEL (3)
Department of Management Theories, Faculty of Management Science
and Informatics, University of Zilina,
Univerzitna 8215/1, 010 26 Zilina, Slovak Republic
E-mails: (1) josef.vodak@fri.uniza.sk; (2)
jakub.soviar@fri.uniza.sk (corresponding author); (3)
viliam.lendel@fri.uniza.sk
Received 04 October 2014; accepted 06 April 2015
Prof. Josef VODAK, PhD in Management (University of Zilina),
lecturer at Faculty of Management Science and Informatics, University of
Zilina. Research interests: talent management, marketing, human resource
management.
Assoc. prof. Jakub SOVIAR, PhD in Management (University of
Zilina), lecturer at Faculty of Management Science and Informatics,
University of Zilina. Research interests: cooperation management,
marketing management, marketing communication, sociology.
Assoc. prof. Viliam LENDEL, PhD in Management (University of
Zilina), lecturer at Faculty of Management Science and Informatics,
University of Zilina. Research interests: management information
systems, CRM, innovations.
Caption: Fig. 1. Key factors taken into account when considering
potential collaboration
Caption: Fig. 2. Model for building cooperation management in a
company
Table 1. Definitions of the term cooperation management
Author(s) Definition
Rosenfeld (1996) Cooperation management is an
emerging approach to
industrial competitiveness.
Cooperative behavior will help
SMEs firms compete, and
therefore the goal is to alter
the behavior of enterprises
and to facilitate cooperation.
Hanna and Walsh (2002) It is trend of inter-working
among small firms. It needs to
evolve into a mechanism to
enable small firms to develop
innovative products and
processes jointly. Small firms
may have to rethink their
approach to cooperation and
their motives for initiating
inter-working if they are to
benefit fully from
cooperation.
Brown (1998) Cooperation management may be
a simple partnership
arrangement between government
and industry, or it may be a
much more complex relationship
wherein government actually
transfers authority over the
management of the resource to
industry, community or
regional users.
Davis (1999) Cooperation management is the
part of the cooperative
community professionally
engaged to support the whole
cooperative membership in the
achievement of the cooperative
purpose.
Oludimu and Adedoyin (1996) Cooperation management is also
directed towards the three (3)
Es of management, viz,
Efficiency; Effectiveness; and
Economy. Cooperation
management is responsible for
the daily operations of the
organizations.
Tipa and Welch (2006) Cooperation management is
based on the interaction
between equal partners in
decision-making, where each
group retains its distinct
identity and independence
throughout the process.
Zhang (2011) Cooperation management is a
core of all management
problems. Cooperation
management provides conditions
of constructing a cooperation
system. These conditions are
the motivation of resource
dependence, objective of
effect enhancement,
constraints of encouraging
cooperation and possession of
technology of cooperation.
Table 2. Summary of the contributions of individual
approaches to managing company cooperation activities
Author(s) Emphasis Contribution
Ritala and Sainio Determination Application of the
(2014) and close business model
collaboration
between
cooperating
parties
Mustak (2014), Creation of Application to the
Kultti (2011) cooperation area of innovation
networks of services
Felzensztein et al. Portfolio of the Application to
(2012) areas of marketing activities
collaboration and and innovations
its gradual
expansion
Wicks et al. (1999) Company performance Cooperation process
based on trust
Fawcett et Correct Dynamics of trust
al. (2012) understanding building in
of trust cooperation
Biggiero (2006) reation of Use in managing
knowledge critical activities
Szekely (2008) Specifics of Taking into
the region consideration
specifics of the
region when
establishing
cooperations
Kowalski and Motivation for Main motivation =
Marcinkowski (2014) starting a existing market
cooperation potential within the
regional economy
Nemcova (2004) Uniqueness of Influence of the
cooperation uniqueness in
managing a
cooperation
Perry (2007) Process of control Establishing
suitable metrics
Staber (2010) Imitation within Behavior of partners
cooperation
Schmoltzi and Organizational and Efficient planning
Wallenburg (2012) strategic complexity of cooperation
in building activities
cooperation
management
Table 3. Level of use of cooperation management
in Slovak enterprises
Researched area Main results
Area of the most developed --Supplier relationships
cooperation (68.13%)
--Purchasing relationships
(52.38%)
--Technical cooperation
(44.32%)
--Education (35.16%)
--Advertising and promotion
(24.18%)
Main issues arising when --Insufficient adherence to
the agreed contractual terms
(58.39%)
cooperating with other --Financially demanding
organizations (35.04%)
--Distortion of information
(34.41%)
--Low effectiveness of
cooperation (29.56%)
--Unwillingness to provide
internal information by a
cooperating company, i.e.
concerns about providing
internal information to a
company (28.83%).
Main benefits resulting --Good mutual relations
from cooperation (26.62%)
--Improved profit (20.78%)
--Reduced costs (20.13%)
--Improved competitiveness
(15.58%)
Areas for improvement in --Improved communication
cooperation (31.78%)
--Adherence to contractual
terms (23.08%)
--Improved effectiveness of
cooperation (22.14%)
