Co-opetition: cooperation with the competitor
Cooperation and competition as we have known it are complete opposites. The trade-off between them is a zero-sum game, where you either share the pie through collaboration, or capture a larger piece through competition. In the market, one company’s gain is another one’s loss. Disruptive times, technological change and all its spill over effects are here to stay. This has changed the rules of the game in terms of collaboration with rivals. Can you be friends with your foes? Using co-opetition, the traditional win-lose scenario could be transformed into a win-win situation, where sometimes even the industry as a whole benefits. Pooling rivalling resources potentially creates opportunities in terms of research and development, risk mitigation, cost-reduction and market access. Joining hands with competition can give the combined power to tackle otherwise impossible economic challenges. A recent and well-known example is the collaboration between industry rivals to develop the vaccine against COVID-19 at record breaking speeds using ground-breaking technologies. However, reward does not come without risk. Navigating through such a collaboration is not easy, as organisations must protect their intellectual property and competitive ground. Trust issues between the parties involved can be a challenge as companies do not want to give away their current advantages. Additionally, companies potentially have to manage resistance within their own firm. Co-opetition is a sensitive partnership with potential for high risk and high reward. When do companies favour cooperating instead of competing with their rivals? How can a company overcome the challenges of co-opetition to get to a win-win game?