Competitions are a thing of a past as consumers became flicker minded and switch cost is lower due to advent of technologies e.g. having different video conferencing application in a mobile. Monopolies discourage innovations and create unfair pricing for consumers. Many countries even have laws regarding competition to prevent creation of monopoly e.g. Singapore Competition Act. A new breed of organization emerges where competitors works in cooperation across different regions. A world of coopetitors!
What is Coopetition?
Coopetition is a fusion of cooperation and competition. In today’s economy, monopolies are frown upon and even illegal. It is not unusual for competitors to collaborate and cooperate for mutual benefits. Many examples existed such as airlines alliances with their codeshare connection, automotive partnership that owes HERE maps and Alibaba network of merchants, suppliers and eCommerce shops.
What Cooperate yet Compete?
All these coopetitors have a common objective to increase competitive advantage, enlarge market share, extend market reach and coverage with the consumers. This would create a network effect globally as a single organization will take a longer period to achieve this. Moreover, technologies have disrupted barriers and amplified threats of market entrants to traditional industries. By sharing, these organisations can create greater value in combating these entrants. Vice versa, new startups can allied together to take on existing incumbents. Without coopeting, these objectives would be impossible.
COVID-19 Effects on Coopetition
Perhaps the best case study of Coopetition comes from COVID-19 pandemic. Covid Vaccines have taken less than a year to be developed compared to several years for a typical vaccine. It will be impossible unless information is shared and collaborated among old foes and competitors. Another example is the collaboration between transportation providers, Food and Beverages (F&B) businesses and food delivery during COVID-19 lockdown like ComfortDelivery in Singapore. Will your organization be mature to coopete against this new breed of alliances?