[8] 2002 e-business-strategies-for-virtual-organizations

IS planning strategies for emerging business models
keep firms lean and drive innovation. That emphasis has been
challenged across the board today as the notion of coopetition
gains currency. Cooperation with suppliers, customers and
firms producing complementary or related products can lead to
expansion of the market and the formation of new business
relationships, perhaps even the creation of new forms of
enterprise.
In place of seeking to compete within the market, taking as
much customer base and profit as possible, regardless of the
interests of other companies, and seeking to drive competitors
out of business, coopetition seems a gentler, if more difficult,
game. Some people see business entirely as competition. They
think doing business is waging war and assume they can’t win
unless somebody else loses. Other people see business entirely
as cooperative teams and partnerships. But business is both
cooperation and competition. It’s coopetition.
Coopetition often involves companies agreeing not to battle in
one market even as they fight like dogs in others: witness the
current ‘grand alliance’ of Sun, IBM, Apple, and Netscape,
which is supporting the open programming language Java to
undermine Microsoft’s market power. More commonly, companies
will compete on actual products even as they cooperate
on technical standards, sacrificing a degree of independence to
increase the odds of success for the technology as a whole. Look
at the huge success of American Airlines in opening its Sabre
reservation system to competing carriers.
The concept, and the word, seem to have been taken up most
enthusiastically in the computer industry, where strategic
alliances have long been common in order to develop new
products and markets, particularly between software and
hardware firms. Another motivator for the computer industry is
that its consumers want to know in advance that a broad range
of companies will support a given technology. Companies
cooperating helps such markets grow faster, without waiting a
long time to dump competing technologies. It also helps focus
scarce resources – though not necessarily on what is ultimately
the best technology.
Needless to say, coopetition makes regulatory authorities
nervous. There is an old-fashioned word for competitors who
agree not to compete – cartel, with its overtones of price fixing.
Today’s regulators say that they appreciate the theoretical
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