Use Co-opetition to Build New Lines of Revenue

Harvard Business Review

The way forward is co-opetition, in which entities in the same industries act with what everyone recognizes as partial congruence of interests. Nalebuff have written in their book Co-Opetition , businesses that form co-opetitions become more competitive by cooperating. There [are] lots of co-opetitions.”. In another example, Peugeot Citroen will supply Toyota Motors light-weight trucks to sell under the Toyota brand in the European market.

Joint Ventures Reduce the Risk of Major Capital Investments

Harvard Business

A company sets up a joint venture with a partner that has complementary assets and capabilities, in order to limit up-front investments, speed up market entry, and reduce risk. Ageas contributes its expertise in insurance product design, marketing, finance, and risk management, while the partner, often a well-embedded local financial institution, contributes its customer portfolio, distribution channel, brand, and relationships. Benefits and risks of co-opetition.

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Why Your Company Should Partner with Rivals

Harvard Business Review

The thinking behind this axiom began to be challenged in the mid-1990s, with the publication of smart, highly-regarded competitive strategy books, such as Co-opetition by Barry Nalebuff and Adam Brandenburger. By translating game theory into pragmatic business strategy, Co-opetition cleverly showed companies a new path to revenue growth: It's better to own 20 percent share of a $10 billion market than it is to own 75 percent share of a $2 billion market.

Leadership Is About to Get More Uncomfortable

Harvard Business Review

And along with this increased transparency, you’re held accountable for areas you know less about: new technologies, new markets, new cultures and geographies representing new stakeholders. Such “co-opetition” will require leaders to maintain a difficult dual perspective – rivals must be simultaneously seen as both vital partners and market threats. Companies must now appeal to a plethora of global consumer markets, each with distinctive attitudes and desires.

Old Management Systems Stifle New Business Models

Harvard Business Review

Even today, with more than $200B in market capitalization largely derived from that same data, investors struggle to value the company’s information. We need to mark our information assets to market or depreciate them as they become obsolete. They’re reminded that conglomerates with diverse industry focus tend to underperform in their markets (at least in industrialized nations) as compared with focused firms. Ask anyone in technology.