DOES it make you smarter when you defeat an enemy by stabbing him in the back? When you survive a fight, does it make you the fittest? The answer would be in the affirmative, if we were still living in the Stone Age.
In today’s modern business world, when your competitors are hitting it big while you’re dealing with crumbs, you tend to get mad at your conquerors. Or do you? At times, it does look like that’s your only legal option.
Sometimes, you tend to begrudge your competitors and think a lot of negative things. ‘They’re not doing it fair and square. They’re bribing some people in government and some private organizations to corner lucrative deals,’—are some of the thoughts that simmer in your head.
Amid the pressures of the daily business grind, we tend to look at our competitors as mortal enemies. They’re the reason we can’t get ahead. We have every reason to be mad at them. The mere mention of a competitor’s name is enough to make our blood boil.
Looking at it from a different angle, however, you’ll be amazed at how many competitors are banding together toward a mutually profitable endeavor. No, I’m not referring to PLDT-Smart and Globe Telecoms’ recent cooperative purchase of the telecom frequencies of San Miguel—now the subject of an interesting first review case by the Philippine Competition Commission.
Sometimes, consumer groups with ingenious minds look suspiciously at the pricing scheme of “competitors” in the oil industry. Why would they not suspect that? The industry players offer almost the same price rates for their petroleum products to the general public that would make one suspect of an unholy connivance.
After all, who would want to be swayed away from that alliance by a mere 3-centavo difference?
But that’s not what I mean. I’m referring to a long list of formal, successful business partnerships between and among competitors. It’s a long-established business strategy that has proven to be a success formula for many organizations, for long decades before the book “Co-opetition: A Revolutionary Mindset that Combines Competition and Cooperation” (1996) was published.
Authors Adam Brandenburger and Barry Nalebuff discuss “at length the notion of co-opetition, a business strategy gained from game theory to demonstrate when it is better for competitors to work together rather than to go up against one another in contest.” The authors use many examples to show the simultaneous interplay between competition and cooperation, which complemented the work of Michael Porter’s five forces model.
Off the top of my head is the partnership between hard rock competitors such as Fuji and Xerox, and, of course – Toyota and General Motors, under a joint venture agreement called New United Motor Manufacturing Inc. (NUMMI). They’re good case studies on why competitors should work like “frenemies” (or friendly enemies).
Outside of business, co-opetition can be a potent success formula for politicians. The sooner that a powerful and popular president gets elected, traditional politicians, known as “trapos” (dirty rags), soon change their affiliation to be aligned with the dominant party.
That’s how co-opetition becomes a pernicious practice.
In my own little way, I’ve attempted at times to partner up with my local competitors in the management consulting industry. My intention is pure and simple. I’d like to make the pie bigger for everyone so that we would not fight for a small market. As expected, my local counterparts have shunned my proposal. No deal.
Does it have something to do with their self-confidence? I’m not sure.
Whenever I get a chance to talk to some of my regular clients, I normally get the impression that my qualifications are unique and different from those of all the other consultants and that I don’t need to establish a co-opetition strategy with them. Of course, that’s not true. If I accept that thought, I will be lulled into complacency, which I don’t like to happen.
So, if you’re considering co-opetition, do it for reasons other than a personal, bigger paycheck. After all, money is not everything. And that’s according to moneyed people.
Rey Elbo is a business consultant specializing in human resources and total quality management as a fused interest. Send feedback to firstname.lastname@example.org or follow him on Facebook, Linked or Twitter for his random management thoughts on Elbonomics.