Consider two rival airlines companies. In the United States, Delta Airlines and United Airways are fierce competitors. They go head-to-head for prime time slots, routes, airport boarding gates, and, most importantly of all, customers. They are corporate giants squared off against one another in a cutthroat, high-stakes market.
However, underneath the battle we see on the surface, these two competitors are in fact cooperating with each other in many ways. When Delta and United both contract Boeing to develop a more efficient airliner, the two companies benefit by sharing in the investment, thus lowering the cost of next-generation jets for both companies. (Brandenburger & Nalebuff, 1996, p. 20, 28) Simply put, they are better at competing with each other when they cooperate with each other.
Look past the marketing and advertising: the airline industry, like every industry, is a massive interconnected web of suppliers, competitors, and partners. Airlines in direct competition with each other realize if they do not cooperate with other carriers to share airports and transit hubs, their ability to compete will essentially vanish. Of course, air carriers are just one example — wherever business transactions take place you can see some degree of cooperative coordination.
The word ‘coopetition’ has been used for a long time to describe this phenomenon in business. In 1911, an oyster packager named Kirk S. Pickett described his sales agent strategy as “co-operating with one another to develop more business for each of you. You are in co-opetition, not in competition.” (Cherington, 1913, p. 144) More recently, in 1993, Ray Noorda wrote an article arguing that businesses need to think more strategically about how they mutually cooperate while they are competing against one another. Co-opetition is a globally occurring phenomenon in business: cooperation and competition happen at the same time. (Noorda, 1993; Stein, 2010, p. 257)
I recently went to the hardware store to buy a furnace filter. As with most purchases, many options were presented. Not only could I purchase multiple filter sizes, but there were also multiple brands of each filter size to choose from. True, all the brands were in competition to sell me their product, but yet they were also cooperating: distributing their product to a central retailer, largely co-investing in same supply chain, and, of course, manufacturing standardized filter dimensions to fit my furnace. Past the first glance, competition can look and function a lot like cooperation.
Rather than deifying one and demonizing the other, examine your world beyond the categories of competition and cooperation. A city that can cooperate enough to provide enough bread for all its citizens is a city that likely has strong competition between its bakeries. Competing helps us cooperate; cooperating helps us compete. Today, as both a competitor and cooperator, take a moment and appreciate your place in the symmetry.
Originally published on the Caesura Letters. See caesuraletters.com for information on paperback, ebook, and email subscriptions.