Why collaboration is important in business: A guide to making the case for leaders and people managers

The story of the Tower of Babel explains the creation of different languages and cultures. It shares the tale of Babylonians who worked together to build the highest tower that had ever existed.¹ 

It’s a great example of team collaboration—and a good metaphor for why collaboration is important in business. When you encourage people to work together and create a safe environment, they’ll achieve great things together—just like the Babylonians. 

Unfortunately, the Babylonians never managed to see their vision through to completion. The project was going great until, one day, workers woke up and found out that they couldn’t communicate anymore—they were all speaking different languages. End result, they got frustrated due to the communication breakdown and abandoned both the project and the city. 

While this sounds like a bit of a downer, there are useful lessons here, too. Namely, that having a shared goal or telling people to work together isn’t enough to inspire them or to succeed. It’s your responsibility as a leader to understand how collaboration benefits everyone—from individuals to businesses. You also need to know how to communicate those benefits to your team and peers, get buy-in, and get everyone to speak the same language and work well together. 

Only once you’ve defined your collaboration ground rules can you get people to cooperate and achieve common goals more efficiently. In this article, you’ll learn why collaboration is important in business and some best practices to promote teamwork. Let’s dive in. 

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9 reasons why collaboration is important in business

You want your team to collaborate as the Babylonians did when they were building their tower—not when they forgot how to communicate with each other. But, to avoid having them abandon the project, you need to really understand how collaboration helps them, rather than just telling them to work together, and how collaboration can help your business grow.

How collaboration benefits companies 

When people work well together, share ideas, and connect with colleagues they bring in better results. Here’s how your business can benefit from collaboration: 

Better processes, productivity, and performance 

People work together and learn from each other constantly: when they ask a peer to share a report, during weekly meetings, and during formal sessions or on cross-functional projects. So collaboration can improve performance.

When you’re focused on building a collaborative culture, those interactions can often lead to spontaneous brainstorming sessions, faster problem-solving, and better results. 

For example, let’s say two team members are having a chat. Chris is complaining to Laura about not being able to automate a spreadsheet. Laura offers to help and suggests he opens the spreadsheet via a link in their Switchboard room so they can both work on it together. She spots an issue with the cell formatting and they work together to fix the issue and document the steps they took to resolve it so others can benefit if they run into the same issue in the future.

Another way collaboration can improve business performance is by having shared and clear goals—in fact, 85% of people who know their goals are more productive than those who don’t.

It’s also helpful to have people collaborate toward a bigger departmental goal. “The key to this is that the team actually comes together and collaborates on what the goals are,” explains Andrea Galvez, Vice President, Client Success & Membership at Financial Health Network. In her organization, “Everybody on your team has their own separate professional development goal that’s contributing to their colleagues.” Besides improving productivity, having shared goals also enables people from the same department to help each other to meet and exceed their targets. 

“For marketing agencies like CodeCrew, we wouldn’t exist without collaboration, plain and simple. So much of our business is built on trust, not just between our team and our clients, but within our company itself.”

—Alex Melone, Co-Founder and Chief Production Officer, and Andrei Marin, Chief Operations Officer at CodeCrew INC

More diverse teams with multiple skills and experiences 

It’s likely that the people working at your company have unique points of view and life experiences. When you lead collaborative teams, you get to hear different perspectives and ideas. This leads to more inclusive teams that solve problems faster, instead of having one person handle all decision-making.

Team collaboration also helps reduce unconscious biases and exclusive language in your product, copy, sales scripts, or budgeting decisions. Discussing ideas with diverse and different teams lets you spot these before they reach your customers. This results in better products and solutions that either serve a larger slice of the market or are better tailored to your niche. 

Diverse teams can also help to come up with solutions faster. Ashley Russo, Founder and President of ASR Media Productions shares how, in 2020, she needed to find a way to do business without breaking CDC guidelines. “We had each team member research and brainstorm on their own, and then as a group,” she explains. “We fully stayed solution-focused and in a matter of days, we mastered a brand new virtual platform to host ‘live’ events, fundraisers, and meetings. This innovation was completely due to collaboration.”

Shorter time to market

Teams that know how to collaborate usually come up with ideas that solve customers’ problems faster than siloed ones. This is because they ask for help and get colleagues involved in brainstorming sessions earlier. 

“We have been able to significantly improve our on-time delivery by bringing various departments together to come up with solutions. We also asked customers for feedback and seriously listened to and considered their ideas,” says Ashley. 

Putting a process in place to manage interactions also makes it easier for teams to know who the decision-makers are. This is especially helpful in cross-functional teams where team leaders may not always agree. 

For example, let’s say the marketing lead approves all discussions regarding digital ads and the sales lead is a contributor. If they have different opinions on how to promote a product, they can have a healthy discussion, but the marketing lead will be the one to make the decision.  

To clarify the roles during collaborations, you could set a PACE for all projects, which stands for  Process owner, Approver, Contributor, and Executor. This makes cross-functional work much more organized which leads to better decisions and faster time-to-market. A clear PACE also helps employees know what to expect when working with others and avoid frustrations if the approver chooses to take a different direction. 

Pro tip: Collaborating in a digital workspace like Switchboard makes it easy for everyone to review files and share ideas live or async. You can add your PACE document in a sticky note for visibility, brainstorm on a whiteboard, or edit files together without sharing your screen or delegating control.

Increased company reputation

People are more invested and connected to the company if they have a shared purpose. Since your employees are your first brand ambassadors, happy employees result in a good reputation. 

Also, modern customers are interested in more than just products and services. They want to know who’s behind the product they buy and what your company stands for. So having a good reputation can help your business grow. Great examples of this include Patagonia, which aims to reduce the environmental impact of making clothes and pay workers fairly. Also, Cabify, which has been carbon neutral since 2018 and plans to have a fully electric fleet by 2030.

Superior innovation

The Tower of Babel story might have turned out differently if people had found another way to communicate, like using signs or symbols. This is the kind of innovation and problem-solving you get when you build a truly collaborative culture. 

Collaboration drives innovation because when you invite people that aren’t in the weeds of the problem to help find solutions they come with a fresh perspective. This makes it more likely they’ll come up with something that either solves the problem or sparks others’ creativity. 

At CodeCrew INC, they run everything by the team, even email marketing campaigns, because they believe the outcome is worth it. “Collaboration promotes open dialogue and discussion and allows team members to build upon each other’s ideas, visions, and expectations,” explains Alex. “Group collaboration can only bring in new ideas, perspectives, and approaches to solving problems."

He also shares how their newest team member approached him with the idea of revamping a process that no one had questioned for years. “Her idea led to an account-wide collaboration, which in turn led to us updating one of our central documents in a way that allowed us to be even more flexible on client accounts that don’t fit into our usual mold,” he says. 

When people at the company know that their opinions are valid and implemented, they’re more likely to contribute to the company’s performance.

How collaboration benefits employees 

Imagine how frustrating it must have been for Babylonians to try and work with people who couldn’t understand their perspective, struggles, or way of communicating. That’s why actively creating spaces for your employees to work together more effectively can make them feel more motivated. 

We’ve covered how collaboration benefits the company, now we’ll get into the employees' side. 

More motivated, satisfied employees

Humans are social creatures. As social psychologist Theodore Mead Newcomb, says “Humans are so thoroughly socialized that virtually all their problems must be met by coming to terms with other people.” This means that to solve problems often you just need to talk to others. When people collaborate with each other it drives motivation because they:

• Feel seen and their work is helping someone else
• Can see the direct impact of their work
• Want to simplify their colleagues' lives and make them happier

Studies show that when new hires are brought into projects and get help from others in the same department, they’re 65% more likely to stay at the company for longer compared to new hires that work in silos. 

If your turnover rate is low, you save money in hiring and onboarding costs and have a more productive team as you’re not frequently training new hires. Plus, you can allocate that money toward employee engagement activities like games nights, team-building exercises, or professional development training to drive retention.

“Collaboration creates an environment where people feel valued, heard, and appreciated. Individuals are much more likely to speak up and be honest with each other when it is not about their singular idea or viewpoint but rather, finding the best solution.”

—Ashley Russo, Founder and President, ASR Media Productions

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Pro tip: You can create persistent rooms on Switchboard for employee onboarding and learning. There, you can store all the materials you need, save time getting new hires up to speed, and ensure consistent training.

Stronger, more connected teams 

People don’t always go to work to make friends, but it’s a nice surprise when it happens. When people care about colleagues on a personal level they feel more connected to each other and the company. Fostering a culture of workplace collaboration allows team members to have more opportunities to connect, get to know team members, spend time together, and eventually form bonds. 

Additionally, when teams work together for a consistent period, they feel connected and trust each other more. “Teams are more invested in the outcomes when they have a voice and everyone remains much more solutions focused because they understand that the entire team is looking for the best outcomes by collaborating,” explains Ashley.

Improved knowledge sharing 

Getting people talking to each other, debating, and coming up with ideas together isn’t just good for your business, it also lets people learn from their peers. This leads to better performance simply because they asked a work pal with different skills how to approach a task. 

You can also take the opportunity to encourage employees to share knowledge and present specific skill sets where they shine—change the moderator and topic each quarter. This makes people feel more engaged because their special skills are being noticed and it also helps team members learn from one another. For example, if Laura is great at finding errors in spreadsheets, you can empower her to give training on the best practices she follows to spot issues with formatting and calculations. 

If you build a psychologically safe culture where everyone can share their thoughts, this practice can also act as a recognition and lead to productive discussions and new ideas. 

Greater sense of responsibility

Imagine you have two tasks due tomorrow and it’s already 5:00 pm. One task is blocking your colleague’s work, the other is a task you’ve set for yourself. Which one will you do first? Probably the one that impacts your coworker, right? 

Your choice was influenced by knowing that your work affects others, so you have a greater sense of responsibility. The same thing happens to your team. So, when you create space for them to work together, they’re likely to deliver on time so their colleagues can do their jobs. 

Of course, this doesn’t mean fostering an always-on culture of toxic productivity where no one can move their deadlines around and request additional time. It means creating an environment where people respect each other’s work and have a strong sense of ownership. 

Best practices for team collaboration 

Effective collaboration is crucial for high-performing businesses, but it’s not enough to just tell people to collaborate. You need to build a collaborative environment where working together is welcomed and celebrated. Here are some team collaboration best practices to implement in your business:

• Use a mix of tools and apps to make collaboration easier. For example, a project manager tool, a whiteboard, a place to store shared files, and a video conferencing tool. Also, a team collaboration tool like Switchboard lets you use all the browser-based files, apps, and documents you need in one place and work on things as if you were side by side. 
• Create psychological safety and never judge an idea. Listen closely to your team member’s interventions and ask questions out of curiosity rather than shut them down. 
• Make sure your company has strong shared values. Respect, open communication, and accountability are a few to instill in your team for better relationships and smoother collaboration.
• Lead by example and be adaptable. Listen to others and invite everyone to participate in different ways, not everyone likes to be put on the spot during a team meeting.
• Set and communicate expectations clearly. Share the why behind the things you do and be very clear about goals and the PACE on collaborative projects.
• Build cross-functional teams for projects. Ensure knowledge sharing across the company and come up with well-thought-out, viable solutions. 
• Own your mistakes. Great leaders can also make the wrong decision, mess up on forecasting, or share an outdated sales report with a client. Be open about your slip-ups and tell your team what you’re doing to resolve them, which helps establish trust in you. 
• Learn how to promote collaboration without burnout. Establish boundaries and guidelines around when it’s ok to check messages and expect a response. (Hint, out of hours is not ok.) Also, maybe you don’t need an hour-long brainstorming meeting every week. Instead, try async collaboration, gather your team’s thoughts through feedback forms, and reduce meeting fatigue.

Stronger collaboration: Good for your teams and business  

Even though the Tower of Babel is just a story, you can apply its lessons to bring your own teamwork to life. It starts with understanding and communicating the benefits and importance of collaboration, not just telling your team to be more cooperative. 

Teamwork makes your company more competitive, agile, and profitable because you get to identify inefficient processes, make faster decisions, and take better solutions to market. It also makes your employees feel more motivated and engaged and gives them an increased sense of ownership and opportunities to learn from one another. 

To lead a more collaborative organization, especially when you can’t get together in person, use the tips we outlined in this piece: Use a mix of collaboration tools and apps; establish strong shared values; create an environment where people feel supported and support each other; set clear goals and expectations; share the why behind everything; lead by example; and own your mistakes. You should also build cross-functional teams for projects and enable knowledge sharing across the company.  

Also, use a team collaboration tool like Switchboard. It’s the ideal platform for collaborative project work thanks to its persistent rooms and multiplayer experience. You can work alongside your team on browser-based apps, documents, and files—and get more done together and async. 

With Switchboard, you can also build strong teams that work closely by enabling more productive and satisfying teamwork and recreating the kind of spontaneous interactions you get in person. So you can get them all speaking the same language and on board until your Tower of Babel is a giant skyscraper.  

Want to improve teamwork in your business?
Make it easy for your team to collaborate live or async in Switchboard’s persistent rooms.
Learn more