Coopetition

Coopetition or co-opetition (sometimes spelled "coopertition" or "co-opertition") is a neologism coined to describe cooperative competition. Coopetition is a portmanteau of cooperation and competition, emphasizing the "petition"-like nature of joint work.

Basic principles of co-opetitive structures have been described in game theory, a scientific field that received more attention with the book Theory of Games and Economic Behavior in 1944 and the works of John Forbes Nash on non-cooperative games.

Coopetition occurs at inter-organizational or intra-organizational levels.

At inter-organisational level, coopetition occurs when companies interact with partial congruence of interests. They cooperate with each other to reach a higher value creation if compared to the value created without interaction and struggle to achieve competitive advantage. Often coopetition takes place when companies that are in the same market work together in the exploration of knowledge and research of new products, at the same time that they compete for market-share of their products and in the exploitation of the knowledge created. In this case, the interactions occur simultaneously and in different levels in the value chain. This is the case of the arrangement between PSA Peugeot Citroën and Toyota to share components for a new city car—simultaneously sold as the Peugeot 107, the Toyota Aygo, and the Citroën C1, where companies save money on shared costs while remaining fiercely competitive in other areas. Several advantages can be foreseen, as cost reductions, resources complementarity and technological transfer. Some difficulties also exist, as distribution of control, equity in risk, complementary needs and trust. It is possible for more than two companies to be involved in coopetition with one another.

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