Erin Griffin, CIO and vice president of IT at Loyola Marymount University (LMU) and Mitch Davis, CIO of Bowdoin College, met three summers ago at Snowmass, near Aspen, Colo., during a conference on academic computing. They chatted, shared experiences about their respective challenges and traded some ideas. But it didn\u2019t occur to either of them that they could join forces until they met up again in 2005 at the same conference.\n\nThey were leaving a session about disaster recovery, reflecting, Griffin remembers, that they were both in similar jams. Disaster recovery solutions from vendors were expensive\u2014especially for small colleges (like LMU and Bowdoin) with limited budgets. Griffin and Davis joked about how easy it would be for people to replicate each other\u2019s data centers if only they were willing to work together. Then came the epiphany.\n\n\u201cWe said, What if we actually did it?\u201d Davis recalls. Half a year later, Griffin, who is based in Los Angeles, and Davis, in Brunswick, Maine, began developing a solution that allows them to host each other\u2019s disaster recovery sites. And it has cost a mere fraction of what it would have to hire a vendor.Collaboration Theory\nFor another view on this topic, read an excerpt from Wikinomics: How Mass Collaboration Changes Everything.\nSamuel Gaer, executive VP and CIO of the New York Mercantile Exchange (Nymex), faced a different problem. A major competitor was encroaching on Nymex\u2019s market share by offering competing energy futures contracts on a \u201cside by side\u201d system for trading both securities and their options, while Nymex was still executing them manually (brokers screaming out orders in the trading pit) from its trading floor during daytime business hours. Gaer needed to get Nymex\u2019s contracts online in a hurry. Nymex had a system ready (ClearPort) that it had upgraded, but Gaer knew that the Chicago Mercantile Exchange (CME), which specializes in financial futures, had a well-established electronic trading platform called Globex. \u201cFrom a technical standpoint, our system was robust, but CME [and Globex] still had some distinct advantages,\u201d he says. For instance, Globex, which had been around since 1992, had been more heavily tested and as a result was more scalable. So Gaer swallowed hard and called CME COO Phupinder Gill to propose a partnership.\n\n\u201cI essentially said, \u2018Why should Nymex reinvent the wheel when we can collaborate?\u2019\u201d Gaer recounts. Working together over the next year, Nymex and CME came to an agreement that enabled Nymex to list its futures contracts on Globex.\n\nThe partnership helped extend CME\u2019s Globex platform, improving its customers\u2019 experience (many also did business with Nymex). For Nymex, trading volume in the crude oil futures it offered grew from 220,000 to more than 500,000 a day in 6 to 8 months.Words to Collaborate ByHow two CIOs with separate collaboration experiences view partnerships \nSamuel Gaer, CIO, New York Mercantile Exchange:\n\u201cI can code in seven different languages, but I\u2019m a business guy.\u201d When Gaer proposed listing Nymex\u2019s energy futures contracts on the Globex platform run by the Chicago Mercantile Exchange, he told his boss: \u201cThis has nothing to do with a lack of faith in our abilities; this has everything to do with a forward-looking business relationship.\u201d\nErin Griffin, CIO, Loyola Marymount University:\nA successful collaboration pairs partners with complementary skills, says Griffin, and that\u2019s what she found with Bowdoin College CIO Mitch Davis. \u201cMitch is the king of the creative idea. I\u2019m a process and planning person.\u201d Together, Davis and Griffin built a disaster recovery system for both schools. \u201cNot only did our staffs have complementary skills,\u201d says Griffin, \u201cwe did as well.\u201d\n\u2014 C.G. Lynch\n\n\n\n\nThe Collaboration Imperative\nThese efforts (for which Loyola Marymount and Nymex each received 2007 CIO 100 awards; go to www.cio.comhttps:\/\/www.cio.com\/cio-100\/ for all the honorees) represent a growing trend among companies toward collaborating with industry peers. A global study by IBM of 765 CEOs last year revealed that more than 75 percent place a priority on partnering outside their organizations to create innovation. But there remains a collaboration gap, with only 50 percent actually reaching beyond their own enterprise to partner with another organization. That gap, the study concludes, represents an opportunity for CIOs to lead the way as facilitators of intercompany collaboration.\n\nBut assuming this role is a challenge for IT departments, which typically take pride in in-house innovation. \u201cThe role of the inventor is disappearing,\u201d says Navi Radjou, VP at Forrester Research. \u201cThey need to stop inventing and take on the role of...transforming raw technologies into a meaningful application for [the] business.\u201d\n\nLMU and Nymex have reached out to transform the way business is done in their industries. In so doing, they\u2019re helping to define best practices for partnerships in business innovation.\n\nHow to Bring the Boss Along\nEven though most CEOs might tell IBM\u2019s survey team that they would welcome external partnerships, they still have to be convinced that these partnerships with putative competitors are good for business. There are three factors that count with the boss: good timing, a solid ROI and an immediate business need.\n\nGriffin and Davis conceived the disaster recovery plan for LMU and Bowdoin in 2005. They were still brainstorming when Hurricane Katrina devastated the Gulf Coast in August and forced colleges such as Tulane in New Orleans, to shut down. Disaster recovery became a hot topic. \u201cAll of a sudden people were interested in it,\u201d Griffin says. \u201cSo we took it to our senior administrations.\u201d Cost became the overriding factor, Bowdoin\u2019s Davis says. \u201cI\u2019d been thinking about what it would cost to do disaster recovery with a vendor\u2014you just couldn\u2019t do it.\u201d\n\nIn the case of Nymex, CEO James Newsome was keenly aware that the company had put significant time and money into ClearPort. But in 2005 Nymex developers were still putting the system through its paces. So when Gaer made the case to collaborate with CME, he emphasized the benefits of speed and economics.\n\n\u201cI said that CME spent $7 billion in seven years building a worldwide distribution market for Globex,\u201d says Gaer. \u201cIf we put our products on Globex,\u201d he argued, \u201cthen we\u2019d have the immediate distribution we needed.\u201d\n\nNewsome bought Gaer\u2019s argument, acknowledging that the decision ultimately was about business, not technology.\n\nThere were some sticking points during negotiations. For example, Nymex worried about ceding some control over its technology to CME. In exchange, Nymex wanted CME to sign a noncompete agreement promising not to list futures contracts that resembled Nymex\u2019s. CME eventually agreed, and the deal went forward. (In June, the companies quashed rumors that they were discussing a merger after the Bloomberg news agency reported Nymex was exploring a sale with three potential partners, including CME. Executives from both companies said that they plan to continue their partnership as independent entities.)\n\nHow to Bring Your Staff Along\nOnce Gaer worked out the deal with CME, he had an ugly job ahead of him: telling his developers that their ClearPort platform was being shelved in favor of Globex. \u201cIt was one of the hardest things I had to do,\u201d he says. \u201cWe had our own system that we believed was bleeding edge. There was a lot of pride of ownership.\u201d\n\nGaer\u2019s problem was a common one, says Forrester\u2019s Radjou, as IT staff are urged to let go of their role as inventors. \u201cYou don\u2019t want them to think they\u2019re not good at what they\u2019re doing,\u201d he says. Making sure that your IT staff is given ways to make valuable contributions to the project is critical.\n\nThe Nymex developers weren\u2019t blindsided by the news of the partnership (there had been rumors of the deal in the marketplace) but there were, Gaer believes, bruised egos. So in town hall meetings, he went out of his way to make it clear to the developers that their technological work was sound. Establishing that allowed him to explain the business imperatives.\n\nOf course, not all the developers were convinced, so Gaer encouraged them to vent and to challenge him. \u201c[I would] walk to the bottom of the floor and say, \u2018Ask me what you want. Say the emperor has no clothes.\u2019\u201d He also established an open-door policy for his staff to speak with him privately if they didn\u2019t feel comfortable doing so in the town hall forum. Gaer believes that his openness and willingness to hear criticism helped the staff come to trust and get behind the decision.\n\nGaer and CME CIO and managing director Jim Krause also gave the Nymex IT department an active role in the Globex integration. While CME, which deals primarily in financial futures, wasn\u2019t new to energy futures (it had once listed a few Nymex products), it still relied on Nymex IT\u2019s expertise to help with the migration.\n\nLeverage Each Other\u2019s Strengths\nAfter LMU and Bowdoin got their staff and leadership teams on board, the next step was to assess the strengths and weaknesses of each organization. The approach was simple: Figure out which organization was better versed in a particular technology and let that organization help the other implement it. Griffin and Davis\u2019s ultimate goal was to replicate each other\u2019s IT departments as much as possible\u2014from their Web infrastructure to e-mail, to servers. By mirroring each other, they could easily take on each other\u2019s operations if a disaster occurred.\n\nAccording to Griffin, Bowdoin had a good handle on VMware, but LMU had a better grip on Microsoft Exchange. So they helped each other deploy the technologies they knew best, mixing and matching until their IT departments were like twins. \u201cNow you can go right down the list of places where we match,\u201d Davis says.\n\nMetrics for Everyone\u2019s Success\nCollaborating with partners in one\u2019s own industry often breaks new ground. Therefore, measuring outcomes can be difficult. \u201cWe were looking for measures of success, and we found that we sort of redefined them as we went along,\u201d says Griffin.\n\nOne way to ensure that a partnership succeeds is to mind your partner\u2019s goals. For example, while both LMU and Bowdoin wanted a new disaster recovery solution, they needed it for different reasons. Given Maine\u2019s rough winters, Bowdoin would need LMU\u2019s services frequently for short periods due to storms that cause power outages several times a season. LMU, on the other hand, would most likely need Bowdoin only in case of a large earthquake or terrorist attack. (The LMU campus is near Los Angeles International Airport, which has been targeted by terrorists in the past, including an attempt, thwarted by U.S. authorities, to bomb the airport on New Year\u2019s Eve 1999. (Snow storms, conversely, are rare in the L.A. area.)\n\nThe partners designed each other\u2019s emergency sites to reflect the frequency and magnitude of their needs. For instance, LMU would need the ability to conduct all classes remotely for several months in the event of a major disaster. As such, it would need to retain access to one semester of a fully populated course management system. Bowdoin, however, had no such need. Each scaled its storage plans accordingly.\n\nIf the CIOs in a partnership have a good relationship, their goodwill will trickle down to their teams. \u201cWe had mutual respect for each other, and I think that transferred quickly,\u201d says Bowdoin\u2019s Davis.\n\nGaer and Krause are friends and had worked together in the past. \u201cThat really helped\u2014having the familiarity from a cultural as well as a technology level,\u201d Gaer says. As their teams got to know each other, they developed close relationships.\n\nGriffin and Davis helped transfer the energy of their friendship to their teams by bringing their managers to Snowmass, the birthplace of the project. \u201cWe did some bonding over frisbee, golf, rafting and hiking,\u201d says Griffin. \u201cAs much as electronic collaboration is great, it helps to meet people face-to-face and get a sense of what kind of sushi they eat, or if they prefer Fenway Park or Dodger Stadium.\u201d\n\nGriffin says that because collaboration with a peer organization is still a new concept, IT staffs tend to view it with caution. It takes enthusiastic leadership from the CIO\u2014and a few gung-ho staff members\u2014to get things moving. \u201cThere was some trepidation at first,\u201d Griffin says. \u201cBut I have a couple of people who saw this as exciting. Sometimes it takes a few people who look at the world differently to make a collaboration effort like this contagious.\u201d \n\nAssociate Staff Writer C.G. Lynch can be reached at firstname.lastname@example.org. To comment on this story, write to email@example.com.