Eric Lowitt, is the author of The Collaboration Economy and The Future of Value and managing director of Nexus Global Advisors, a strategy advisory firm. A longtime Net Impact member, Eric spoke with Net Impact’s Katrina Stanislaw on the pivotal role of collaboration for a strong economic future. Drawing on his experience as a management consultant, financial analyst, and business owner, Eric offered insight on topics as diverse as the competitive advantage to companies of sustainability, to advice for professionals getting started in the sustainability space.
Katrina Stanislaw (K.S.) How do you define the collaboration economy?
Eric Lowitt (E.L.) In the collaboration economy, governments, businesses and citizens join together to solve problems we hold in common; a natural (and designed) outcome of their collaboration is economic development. This model might seem foreign to free market proponents, but for the first time in capitalism’s history the interests of the commons are now common interest. The link between sustainability and company existence could not be clearer. This reality is clearly seen at the C-suite level within companies. The issue is how get big and small companies alike to work with the government, as well as with you and me to address massive challenges like de-stressing our global water systems while fortifying our global food system (feed 9.5 billion people by 2050 while improving access to healthy foods so that we make life better for the 2 out of every 7 people the global food system currently fails (1 billion malnourished and 1 billion obese people worldwide). When businesses solve massive challenges they make massive amounts of money. This is where we can create shared value. This is the collaboration economy in action.
K.S.: How did you come to understand the value of collaboration?
E.L.: When I was seven my dad founded a community nonprofit that gave basic necessities such as food, blankets and coats to kids that didn’t have access to these essentials. It was called the Smithtown Holiday Project. This taught me that business plays a critical role in meeting societies needs, but it needs a shepherd. That’s what I am—a shepherd. My experience includes nearly two decades in consulting and finance. With this background, and values I learned as 7 year old, I can shepherd businesses towards a collaboration economy. My management background enables me to serve as a “Rosetta Stone” that translates sustainability into profitable action for business. I can speak to C-Suite executives in terms familiar to their day-to-day business and make the business case for collaboration.
K.S. What priorities do you see as essential for change?
E.L.: I can give you three. First is a shift in C-Suite mindset from we can command and control our own destiny, to now we can only persuade and influence others to achieve our destiny. Stakeholders have a much larger, much more powerful and much more persuasive voice in the strategy and decision companies make. Major international companies’ operations are being affected across the globe through stakeholders. In a global economy it is essential for companies’ survival (or sustainability) to make the shift from command and control to influence and persuasion.
Second can companies achieve explosive growth by going “all in” on sustainability? For example, I’m now working with major corporations to help them see how giving consumers access to the companies’ global scale for maximum social net impact will also turn customer relationships from transactional to loyal partnerships. They are hitting the gas pedal on social innovation, and find a win-win-win.
The third and final question, is how to collaborate with rivals? How do you draw the line between collaboration to solve common problems that are environmental and social in nature without violating anti-trust regulations and giving away your IP and competitive advantage? My argument in The Collaboration Economy is there is a very fine yet very clear line that is being drawn by high performance companies that collaborate their way to competitive advantage. Competitors can work together to solve issues held in common; water, food, energy etc. and if they do so correctly, their joint actions will provide each competitive advantage relative to the peers that chose not to participate.
K.S. How do you maximize the impact and connections from networking events?
E.L. There is a flawed assumption that events only last as long as people are all together. The best way to have impact is emphasis in pre-work phase. I’ll share a study out of a Japanese university that emphasizes this point. This study looked at the project management practices of 200 Japanese Companies and 200 US companies. The study discovered that on average US companies spent 25% project management time in up front planning and 75% in execution. The Japanese companies invested 75% of their time planning and 25% in execution. This research is only insightful if you can demonstrate a performance impact. The researchers found that only 30% of the U.S companies’ projects were deemed financially successful by the U.S. companies whereas the Japanese companies deemed 75% of their projects financially successful. More time upfront means confronting the 800-pound gorilla questions, so when you the hit gas pedal you have worked all the potential out roadblocks and you can get it done. For Americans, this requires overcoming the frustration of wanting to get something done, and being “delayed” in planning. But the results are so far ahead and superior.
This is relevant to Net Impact from an events perspective. The insight is about knowing the power and potential of having a diverse group of people in the room. There is real opportunity to collaborate from having the right set of people in the room. Net Impact brings together civil, private and public leaders to share and tackle common problems. The essential is being prepared and knowing who is in the room to be able to really dig into the problems held in common. Gathering is a way to accelerate.
K.S. How do you advise people wanting to work in sustainability to overcome the challenge of you need experience to get experience?
E.L. Many people reach out to me with this question. My best advice is: don’t be afraid to roll your sleeves up to work with the people you respect, even if this means doing 2-3 week internships. The person you respect (and therefore decide to intern with) has been in your position; therefore that person is more open to help you. I did the exact same thing. People took me under their wing, and they then opened doors for me. My advice is find someone you admire, reach out, give him or her the chance to say no to your offer of help. For the skeptics reading this interview, please note that the surest path to failure is to not ask for help. So offer to make calls, do research. Find out how you can help. Sustainability a pervasive and amorphous field, to get started you need to find hubs instead of spokes. Reach out to network hub. Reach out and let people say no. But if you offer value and seek to help, you can get a yes. Personally, I’m always open to help others. There isn’t room in sustainability for heroes.