HBR IdeaCast When to Team Up with Your Competition
Dec 8, 2020
Barry Nalebuff, a Yale School of Management professor and co-founder of Honest Tea, explores the groundbreaking concept of 'coopetition.' He explains how companies can enhance value by collaborating with their competitors instead of solely focusing on rivalry. Nalebuff shares fascinating examples like Apple and Microsoft’s partnership and discusses the delicate balance needed in data sharing and transparency. He emphasizes that even companies like Amazon can benefit from strategic alliances, ultimately inspiring a rethink of traditional competition in business.
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Apple and Microsoft
- In 1997, Apple, facing near-failure, accepted a $150 million investment from rival Microsoft.
- This surprising "coopetition" proved crucial for Apple's turnaround and beneficial for Microsoft.
Why Coopetition Is Hard
- Companies often hesitate to cooperate due to a win-lose mindset, seeing rivals as enemies.
- The goal of cooperation should be self-benefit, not necessarily helping the other side.
Honest Tea and Safeway
- Honest Tea agreed to produce a store-brand tea for Safeway, despite competition concerns.
- They realized that a competitor might otherwise secure the deal and create copycat flavors.
