What's the big idea? Co-opetition

Being competitive doesn't guarantee better results. Sometimes it's good to share.

by Nigel Nicholson
Last Updated: 09 Oct 2013

Back in the days when the UK had industry clusters, the wool textile firms of West Yorkshire would help each other - for example, hosting their competitors' junior staff with job placements on a rotational basis to enhance their business understanding.

Top business schools like my own compete for the best students and faculty but co-operate and share in lots of ways, such as not hiring our own PhD students but exporting them to our competitors.

It is in all our interests to grow our markets, keep them clean and build best practice. But then someone has to invent a horrible new word, and use a mathematical theory (of games) to dignify the idea that a dog-eat-dog world does not build a better society or more satisfied consumers.

Yet the globalisation of supply chains and markets, plus new technology of information and control, mean that there are new, inventive ways of playing out a mixed model, where companies, for example, share development costs, pricing models and standards.

Microsoft and Apple were fierce competitors in many of their markets but spent long periods sharing and helping each other. The zero-sum logic of competitive advantage can destroy value as readily as it creates it.

- Nigel Nicholson is professor of organisational behaviour at the London Business School.

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