Coopetition as a competitive advantage

Contrary to what many game theory experts suggest, the idea that competitors should occasionally cooperate could bring an edge to your organization. Coopetition, or collaborating with your competition, is not a new concept; it has been around for more than two decades. However, recent technological breakthroughs, blurriness in industry boundaries, and revolutionary ways of working are creating a comeback for this strategy concept.

A competitive advantage is something that positively separates your organization from its competitors. A sustainable advantage means that these traits are to be held over a considerable amount of time. However, it is not imperative for an organization to have a sustainable competitive advantage to succeed in the long term. This is actually a myth that is being debunked by modern ways of working.

Although achieving a sustainable competitive advantage is a best-case-scenario for every product or service portfolio, not having it should not keep you from competing fiercely. After all, when scenarios are constantly changing, it is undeniable that what works today may not work tomorrow. Working as a team with your adversaries can be an advantageous alternative to follow.

The benefits of creating strong business partnerships with competitors include access to valuable resources such as technologies and innovations, complementary markets, and even specialized labor. Developing these resources helps all partnership members make a teamed effort to defend their turf or explore adjacencies and new industries.

Furthermore, competing does not necessarily have to be a zero-sum game. Researchers believe that coopetition is a beneficial phenomenon that leads to the development of new opportunities and products. However, cooperative competition is challenging, given the myriad choices and decisions that need to be made, plus the overwhelming possibility of having the other parties take advantage of your goodwill. Therefore, a coopetitive strategy must be carefully analyzed before following it.

When a cooperative opportunity arises, start by imagining alternative outcomes. Is your industry being threatened by a new incumbent? What alternatives might the other side make, what would you do if you didn't agree to the deal, and what could you do to make a deal first? If you don't agree to the agreement, will someone else take your place in it? Ask the same type of questions from your competitor's point of view. It is also essential to bear in mind your current and future state against the other party; this will be especially important once the deal is no longer valid.

If you can figure out how to cooperate without losing your current advantages, you should try it. A sustainable competitive advantage is a myth from the past. It is an idea that is based on the assumption that you have something that will last forever. Unfortunately, nothing lasts forever. We invite you to start thinking in a new way.