Cooperation, competition and coopetition in innovation communities

Abstract

This study explores competitors’ engagement in innovation communities. Some view working with competitors as a risky endeavour, some see it as potentially beneficial and others take it as something in-between. We address this issue by posing two questions: (1) why do rival firms cooperate, compete or ‘coopete’ (a syncretic approach); and (2) how do rival firms engage in these activities? To achieve this, we first review the relevant literature to construct conceptual arguments, and then investigate three innovation communities in the UK. The findings concern the importance of common and conflicting interests as fundamental drivers of a firm’s cooperative and competitive stance in an innovation community. While a ‘win–win’ strategy has been over-emphasised, data reveal that the fear of ‘lose–lose’ is vital to drive firm cooperation. Finally, our study suggests that rival relationships link to a strategic incentive alignment between common and conflicting interests; that is, rivals cooperate when common interests are higher, and compete on other occasions. Data seem to suggest that in a conflicting situation firms often maximise their private benefits at the expense of common interests. Data also suggest that this alignment varies in different innovation stages and in both an inter-organisational and an intra-organisational setting. This paper contributes to the existing work on the competitive/relational strategy of firms in the innovation space.