Build versus collaborate

David Berlind hits the nail on the head drawing attention to Bezos session at the MIT Emerging Technology conference this week. The bottom line is that Bezos says organizations are spending 70% of their time doing "technology heavy lifting" when they should be spending 70% of their time differentiating themselves. I would argue in many organizations that number is actually much higher, maybe even as high at 95% of resources are spent reinventing the wheel and only 5% on differentiation. I can even think of one that spends more than 100% of it's resources trying to be just like everyone else, but I digress.

Bezos explains this behavior as organizations thinking their infrastructure or platform is part of their "secret sauce", but quickly get overwhelmed trying to keep current and trying to achieve homogeneity.

But these days, in many situations, it doesn't simply boil down to "build versus buy" (or in Bezos example, "outsource"). In fact, I'm seeing "build versus buy" decisions less and less and "build versus collaborate" more and more. Collaboration gives the benefits of "build" (you can more easily customize to support your secret sauce) and "buy" (you start with a solid non-differentiating-yet-necessary set of infrastructure to build upon).

Spend (at least) 70% of your resources on differentiation. And then depending on your business model you need to determine how to align the rest of your resources amongst collaborating and buying.

- Don