Coopetitive strategies in the ICT sector: typology and ...

This article was downloaded by: [estelle pellegrin-boucher] On: 08 January 2013, At: 00:29 Publisher: Routledge Informa Ltd Registered in England and Wales Registered Number: 1072954 Registered office: Mortimer House, 37-41 Mortimer Street, London W1T 3JH, UK

Technology Analysis & Strategic Management Publication details, including instructions for authors and subscription information: http://www.tandfonline.com/loi/ctas20

Coopetitive strategies in the ICT sector: typology and stability a

a

Estelle Pellegrin-Boucher , Frédéric Le Roy & Călin Gurău

b

a

Université Montpellier I, Université Montpellier I, ISEM/ ERFI, Espace Richter, Rue Vendémiaire CS 19519 – 34 960, Montpellier Cedex 2, France b

GSCM – Montpellier Business School, 2300 Avenue des Moulins 34185, Montpellier, France Version of record first published: 03 Jan 2013.

To cite this article: Estelle Pellegrin-Boucher , Frédéric Le Roy & Călin Gurău (2013): Coopetitive strategies in the ICT sector: typology and stability, Technology Analysis & Strategic Management, 25:1, 71-89 To link to this article: http://dx.doi.org/10.1080/09537325.2012.751011

PLEASE SCROLL DOWN FOR ARTICLE Full terms and conditions of use: http://www.tandfonline.com/page/terms-andconditions This article may be used for research, teaching, and private study purposes. Any substantial or systematic reproduction, redistribution, reselling, loan, sub-licensing, systematic supply, or distribution in any form to anyone is expressly forbidden. The publisher does not give any warranty express or implied or make any representation that the contents will be complete or accurate or up to date. The accuracy of any instructions, formulae, and drug doses should be independently verified with primary sources. The publisher shall not be liable for any loss, actions, claims, proceedings, demand, or costs or damages whatsoever or howsoever caused arising directly or indirectly in connection with or arising out of the use of this material.

Technology Analysis & Strategic Management, 2013 Vol. 25, No. 1, 71–89, http://dx.doi.org/10.1080/09537325.2012.751011

Coopetitive strategies in the ICT sector: typology and stability

Downloaded by [estelle pellegrin-boucher] at 00:29 08 January 2013

Estelle Pellegrin-Bouchera∗ , Frédéric Le Roya and C˘alin Gur˘aub a Université Montpellier I, Université Montpellier I, ISEM/ ERFI, Espace Richter, Rue Vendémiaire CS 19519 – 34 960 Montpellier Cedex 2, France; b GSCM – Montpellier Business School, 2300 Avenue des Moulins 34185 Montpellier, France

The paradoxical nature of coopetition is determined by a combination of collaboration and competition. Coopetition is a relational mode frequently applied by information and communications technologty (ICT) firms. Using a qualitative approach, this study investigates the evolution of inter-firms coopetitive agreements in the enterprise resource planning (ERP) industry, and on the basis of this data, attempts to discuss coopetition typology and stability in this specific market context. The findings indicate the existence of two main types of coopetitive agreements, coopetitive projects with (i) vertical or (ii) horizontal cooperation between the competing partners. These two coopetition types have different characteristics in terms of purpose, dynamics and stability, presenting a specific balance between competitive tensions and collaboration benefits. The study concludes with a summary of the main findings and with practical propositions directed towards alliance managers. Keywords: coopetitive relations; coopetition typology and stability; industry case; ERP industry

1.

Introduction

In the last 10 years, ‘coopetition’became the focus of a growing number of publications (Bengtsson and Kock 1999, 2000; Gnyawali, Jinyu, and Madhavan 2006, 2008; Gnyawali and Park 2009; Padula and Dagnino 2007; Yami et al. 2010). These studies demonstrate that coopetition provides certain advantages to business organisations, increasing the diversity of technological copabilities and combining complementary resources. Using coopetition, firms can accelerate their R&D, developing new products and services with lower costs (Quintana-García and Benavides-Velasco 2004; Ritala and Hurmelinna-Laukkanen 2009). As a rule, the industries characterised by short product cycles, strong technological convergence and high R&D costs are specifically adapted for coopetitive strategies (Gnyawali and Park 2009). However, these strategies are not devoid of risks (Bonel and Rocco 2007; Gnyawali, Jinyu, and Madhavan 2006; Gnyawali and Park 2009). The collaboration with a competitor offers access to its resources and competencies, providing opportunities to replicate and appropriate them. ∗ Corresponding

author. Email: [email protected]

© 2013 Taylor & Francis


72 E. Pellegrin-Boucher et al. However, the coopetitive partner can have the same intentions (Hamel, Doz, and Prahalad 1989). Coopetitive agreements can therefore provide an asymmetric benefit for one of the participating firms (Dussauge, Garette, and Mitchell 2000; Ritala and Hurmelinna-Laukkanen 2009), which often represent the real, hidden scope, of participating in a coopetitive project (Hamel, Doz, and Prahalad 1989). These specific risks create tensions among partners and increase the instability of coopetitive agreements. However, despite these tensions, some coopetitive projects are stable and successful. This paradox was not yet thoroughly investigated by the specialised literature. The importance of this topic is significant for information and communications technology (ICT) organisations, since the specific conditions of this industrial sector (i.e. short product life-cycles, a strong technological convergence and high R&D costs) force many firms to adopt coopetitive strategies (Gnyawali and Park 2009). Addressing this knowledge gap, our research attempts to: (1) investigate the evolution of coopetitive projects in the ERP industry; (2) on the basis of this analysis, identify a typology of ERP coopetitive agreements; and (3) explain why some types of coopetition are more stable than others. To answer these research objectives, we investigate the organisational relations developed between the main enterprise resource planning (ERP) competitors between 1981 and 2009. The findings indicate the existence of two main types of coopetitive agreements, coopetitive projects with (i) vertical or (ii) horizontal cooperation between the competing partners. These two coopetition types have different characteristics in terms of purpose, dynamics and stability, presenting a specific balance between competitive tensions and collaboration benefits. After discussing the concept of coopetition and the existing typologies, the paper presents the research methodology adopted to collect and analyse secondary and primary data. The presentation and interpretation of findings is made in direct relation to the formulated research objectives. The study ends with a summary of the main findings and with practical propositions directed towards firm alliance managers.

2. Theoretical background 2.1. Coopetition: definition and typology From its origins, strategic management science was consistent with the traditional economic approach, which considered that companies from a specific industrial sector are engaged only in competition (Henderson 1983). According to this vision, each firm has to develop independently a distinctive competitive advantage, in order to create additional or specific value for customers, in comparison with its competitors (Porter 1991). However, in the 1980s, new theoretical models were developed, which introduced the idea that a firm’s capacity to develop cooperation with other organisations represents that real source of value creation (Dyer and Singh 1998). From this perspective, the successful firm is not the one that fights against everybody, as it is highlighted in the hyper-competition theory (D’Aveni 1994), but the organisation that is capable to establish long-term partnerships. In this context, the development of inter-firm relationships based on mutual trust becomes an essential success factor (Dyer and Singh 1998).


Coopetitive strategies in the ICT sector

73

Between these two opposite views, several authors have argued that the maximisation of value creation requires the combination of these two relational approaches. From this perspective, coopetition is defined as the coexistence of cooperation and competition between two or more organisations (Bengtsson and Kock 1999, 2000; Brandenburger and Nalebuff 1995, 1996; Gnyawali, Jinyu, and Madhavan 2006; Gnyawali and Park 2009; Padula and Dagnino 2007; Yami et al. 2010). Two main definitions of coopetition have been developed in the specialised literature. Brandenburger and Nalebuff (1995, 1996) adopted a large perspective, in which coopetition includes all the relations developed between complementary organisations. In contrast, Bengtsson and Kock (1999) proposed a more specific definition, in which the coopetitors are direct competitors. In this situation, coopetition represents an organisational behaviour that is both cooperative and competitive, between firms that offer the same type of product/service to the same consumer segment. The differences between these two definitions provide also a typology of coopetitive agreements: Branderburger and Nalebuff (1995, 1996) develop the concept of general coopetition, while Bengtsson and Kock (1999) focus specifically on coopetition with horizontal competition. Other authors attempted to develop typologies of coopetitive agreements, using various differentiating criteria: Luo (2004, 2005) proposes a typology of coopetitive relations with multinational companies based on the intensity of competitive and collaborative relations; Dagnino (2009) proposes two basic coopetition forms – dyandic and network coopetition – depending on the number of organisations involved and their relations; Lamberg, Ojala, and Sajasalo (2007) adopt a coopetition typology based on the analysis of the value-added chain of the forestry industry; Rusko (2011) combines the systems of analysis developed by Lamberg, Ojala, and Sajasalo (2007) and Luo (2004, 2005). Gnyawali, Jinyu, and Madhavan (2008) combine the model proposed by Dagnino (2009) with the distinction between vertical and horizontal coopetition (Bengtsson and Kock 1999; Brandenburger and Nalebuff 1995, 1996). It is interesting to note that these typologies are often based on the analysis of inter-organisational competition and collaboration, which are then combined in a matriceal form to define specific coopetition categories. In this study, the working definition is the one developed by Bengtsson and Kock (1999), and the proposed typology is only focusing on dyadic relationships. Competition is considered as a horizontal conflict of interests, a situation of rivalry between two or more organisations that target the same segment of customers. 2.2.

The advantages of coopetition

Coopetition allows an organisation to take advantage of the positive elements of both competition and cooperation. On the one hand, a competitive situation forces the organisation to continuously improve their activities and market offers in order to maintain and develop their competitive advantage. On the other hand, cooperation allows the firm to access complementary resources from external partners (Bengtsson and Kock 1999, 2000; Gnyawali, Jinyu, and Madhavan 2006, 2008; Lado, Boyd, and Hanlon 1997). Using coopetition, the companies can accelerate the research and development of their products, significantly reduce costs, increase the volume of sales for complementary products, diversify the portfolio of products or services, and maintain a high level of consumer satisfaction (Dittrich and Duysters 2007; Gueguen 2009; Ritala, HurmelinnaLaukkanen, and Blomquist 2009). A relation of coopetition includes both economic and non-economic exchanges. The cooperative dimension is based on trust or contractual agreements, while a competitive relation depends on


74 E. Pellegrin-Boucher et al. the balance of power among participants, and on their market positioning. Firms with a strong market position tend to adopt a competitive approach, but the need for external resources requires a cooperative behaviour. The simultaneity of these two situations may lead a company to choose a coopetition strategy (Bengtsson and Kock 1999). A company can adopt a coopetition strategy as a result of various factors. An increased market competition forces enterprises to improve their performance and market attractiveness, through cost reductions or new product development. The development of a competitive advantage is an essential condition for the survival and further development of the firm (D’Aveni, 1994). At the same time, the increased heterogeneity and scarcity of resources determines the firm to search for partners that can provide lacking or unique resources, although these partners can sometimes represent direct competitors (Bengtsson and Kock 1999, 2000). A second reason for cooperative behaviour is the existence and effect of social networks (Bengtsson and Kock 1999, 2000). The competing firms are integrated into a social structure which includes several common networks (professional associations, industrial groups, etc.). Often, the personal relations developed within these social networks represent the bases for future inter-firms collaborations. It is interesting to note that in many cases the factors that determine competition and cooperation are not sequential, but simultaneous, forcing firms to combine these two strategies. Often, business organisations discover with surprise that their best potential partner is no other than their most aggressive competitor (Hamel, Doz, and Prahalad 1989). This paradoxical situation raises important questions about the risks and viability of coopetition. 2.3. The risk of coopetition Several authors argued that alliances between competitors do not represent an alternative to market rivalry, but rather a new form of competition (Hamel, Doz, and Prahalad 1989; Hamel, 1991; Lei, Slocum, and Pitts 1997). These agreements are based on conflictual models in which power relations and common interests maintain a fragile equilibrium between partners. Coopetition can be used to better know, control, or weaken a competitor, in order to gain advantage in direct market conflicts. The alliance represents an opportunity to absorb the knowhow of the partner organisation in order to consolidate firm’s own competitive advantage, without transferring strategic information to the partner (Hamel 1991; Ritala and Hurmelinna-Laukkanen 2009). Guidice, Vasudevan, and Duysters (2003) define this type of partnership as a competitive action initiated in order to obtain a short- or a long-term competitive advantage. Collaborating with direct competitors can therefore represent a dangerous situation. The longer the cooperation, the higher the possibility that the competitor reinforces its market advantage, by using the resources and capabilities accessed during the partnership. For these reasons, a partnership developed between competing organisations is under significant pressure. In general, these agreements are short and unstable, since at any moment one of the firms can consider that its partner gains more advantages from the collaboration (Park and Russo 1996). Applying this logic, any firm collaborating with a competitor may be tempted to maximise its personal benefits, either by minimising its investment, or by attempting to absorb most of the value created through the partnership. Usually, this attitude determines the partner organisation to end the coopetitive relationship. 2.4. Coopetition in the ICT sector In the ICT sector, strategic alliances among competitors provide an opportunity for imposing specific technological standards (Gueguen 2009; Shapiro and Varian 1999), allow the integration



75

of existing resources and offer final users a portfolio of technologically-compatible products. In contrast, the application of an aggressive competitive approach permits firms to develop their distinctive competitive advantage, while maintaining a complex network of partnerships, in a dialectic differentiation/integration framework (Dittrich and Duysters 2007; Fjeldstad, Becerra, and Narayanan 2004; M’Chirgui 2005). The firms are confronted with series of transactional choices along various stages of the value chain, which are managed by attempting to balance the conflicting influences of the resulting benefits and risks (Jacobides and Billinger 2006). The advantage of market pioneers (Katz and Shapiro 1994) explains the importance of inter-firm associations. Companies prefer to win as a group rather than loose alone. However, a technology with quick market penetration has better chances to be adopted as a technological standard (Gomes-Casseres 1994; Gueguen 2009). Market pioneers can take advantage of the ‘lock in’ effect (Arthur 1989, 1994) and of the high costs of changing technological systems (Ritala, Hurmelinna-Laukkanen, and Blomquist 2009), which explains the importance given to product communication and promotion in the introduction phase (Eliashberg and Robertson 1988; Shapiro and Varian 1999). Powell and Brantley (1992) consider that in knowledge-intensive industries, the strategies of cooperation and competition are successively applied by most organisations. The pool of common knowledge developed in sectorial networks can significantly reduce the costs of R&D, giving to participating firms several alternative research options (Dittrich and Duysters 2007; Oliver 2004). However, after a product was launched on the market, the know-how developed through collaboration has to be re-integrated within the business organisation. This is when networks are dissolved and competition becomes again the dominant approach, the pioneer firms attempting to differentiate their products in order to develop market entry barriers against followers (Gueguen 2009). This succession of cooperation and competition strategies does not totally eliminate inter-firm collaboration during the competition phase. The high dynamism of technological evolution creates situations in which firms might be in competition for introducing a technological standard, but also in cooperation for developing new products and technologies (Gueguen 2009; M’Chirgui 2005). This analysis indicates that the ICT sector represents a fertile ground for the development and application of coopetitive strategies. Therefore, for many ICT firms, the real question is not whether or not to adopt a coopetitive approach, but rather how to increase the stability of these agreements. This question represents the main focus of our study, considering the context of the ERP industry. 3. 3.1.

Research methodology The ERP sector

The ERP applications are software programs that facilitate the integration and management of organisational processes, using a unique platform. These information systems are based on client– server technology, integrating a series of modular applications that share and use a centralised database. Thus, the firms that wish to use ERP must adopt a central operation system, install a database and introduce an application server, these operations being usually realised by specialised service organisations. From this perspective, we can consider that the value-added chain of the ERP sector is composed of five main elements (see Figure 1): (1) The organisations that supply servers (e.g. IBM, Oracle, Novell and more recently SAP);

76 E. Pellegrin-Boucher et al.

Server

Databases

ERP

Integration

Systems


Figure 1. The value-added chain in the ERP industry.

(2) The producers of databases, such as Oracle, the market leader; (3) The producers of operational systems, such as Microsoft; (4) The producers of ERP systems, such as the German company SAP, which is the market leader since the end of the 1980s; (5) The service providers, which can be either large multinational companies (e.g. IBM – the world leader) or smaller specialised organisations (see Table 1).

3.2. A case study approach The research methodology was focused on a longitudinal analysis of an industry-level case study: the ERP industry between 1981 and 2009 (Yin 1994). The case study approach involves accessing multiple data sources and then using triangulation to reconstruct the image of a complex phenomenon (Eisenhardt 1989;Yin 1989). Data collection is pursued until reaching a saturation stage in which no new information is found. In this study, both secondary and primary data have been accessed and analysed. The secondary research was focused on the specific characteristics of the sector (ERP and EAS – enterprise application system), and on the strategic actions of the main companies (SAP, PeopleSoft, JDEdwards, Baan, Microsoft, Oracle and IBM), collecting information from corporate reports and press releases, market statistics, academic papers and professional articles, published between 1981 and 2009. Primary data was collected through a series of face-to-face interviews that complemented and validated the secondary data. Thirty-two semi-structured interviews (see Table 2) were realised with 18 alliance managers and 10 commercial directors that were directly involved in collaboration agreements with the firms selected for this study, and who had more than 5 years of experience in this field. Some respondents were interviewed more than once. These interviews were realised between March 2004 and July 2006, lasting between 60 and 220 minutes. The data collected through interviews were validated by two industry experts and then analysed using a codification of the main topics discussed by respondents. This discourse analysis method allows the identification of common and convergent themes in the answers provided by respondents. The interview guide was prepared on the basis of the literature accessed during the secondary research phase. In order to facilitate data analysis of the transcribed interviews, the main themes and subthemes identified in the literature have been coded (Eisenhardt 1989). However, during primary data analysis the initial categorisation was refined in order to integrate additional themes expressed by respondents (Miles and Huberman 2003). A total of 11 themes and 60 subthemes were identified in the transcribed interviews (see Table 3).

Developers of ERP systems

Developers of database systems

Definition

ERP is a software system that integrates and manages various functions of an organisation

A database software is a system for organising data which allows the rapid localisation and updating of data items

Global leader Dominant actors

SAP, in the last 20 years SAP, Oracle, Microsoft

Free source software (most important)

Oracle, in the last 20 years Oracle, IBM, Microsoft, Informix, Borland ERP5, Compiere, Fisterra, Apache Derby, Eye DB, Firebird GNUe, OFBiz SQL, Kexi, MySQL

Suppliers of application servers

Integrators/suppliers of services

They represent service and/or An application server is a consulting firms that are server that hosts the software specialised, among others, in applications of an organisation. implementing ERP systems in This server is a central software client organisations program within a multi-layer software architecture IBM IBM IBM, Oracle, Novell, Sun, SAP IBM, Cap Gemini, Accenture (SAP Natweaver) JBoss, Mille-Xterm, JonAS, GlassFish, Geronimo, Tomcat



Table 1. Dominant actors in the ERP sector in 2008

77

78 E. Pellegrin-Boucher et al. Table 2. List of interviews Large firms that develop ERP and EAS systems Companies

Profile of respondents


Oracle Alliance managers SAP Sales representatives PeopleSoft Siebel Microsoft 11 Total: 32 interviews

Large service firms Companies Accenture IBM Bearing Point Cap Gemini Unilog PWC

SMEs Profile of respondents

Profile of respondents Companies Executive directors Alliance managers Sales representatives Consultants Project managers 14

Firme A Firme B Firme C

Company chair CEO Executive directors Sales directors 7

Table 3. The codification of research themes and sub-themes Environment ENV Political (ENV-POL) Economic (ENV-ECO) Concurrence CONC Conflicts (CONC-CONF) Actions (CONC-ACT) Cooperation COO Complementarity (COO-COM) Punctual agreement (COO-PCT) Local strategy (COO-LOS) Coopetition format CFO Agreement (CFO-ENT) Alliance (CFO-ALL) Public projects (CFO-PPR) Coopetition dynamics CDY Entry (CDY-ENT) Exit (CDY-EXT) Emotions EMO Hate (EMO-HAT) Aggressivity (EMO-AGG) Risks of coopetition COR Ambiguity (COR-AMB) Paradox (COR-PAR) Advantages of coopetition COB Cost reduction (COA-RC) Synergy (COA-SYN) Reputation (COA-REP) Trust TRS Institutional trust (TRS-INS) External effect IME Effect on the industry (EEF-IND) Internal effects IMI Organisation (IEF-ORG) Individual (IEF-IND)

Legal constraints (ENV-LEG)

Structural constraints (ENV-SCT)

Retaliation (CONC-RET) Market shares (CONC – MKS)

Aggressivity (CONC-AGG) Opportunism (CONC-OPP)

Knowledge sharing (COO-KSH) Social relations (COO-SR) International strategy (COO-INT)

Vertical partnership (COO-VER) Loyalty (COO-LOY)

Network (CFO-NET) Ecosystem (CFO-ECO)

Collective strategies (CFO-COL) Contracts (CFO-CON)

Coopetitive actions (CDY-ACT) Intensified competition (CDYCON)

Stability (CDY-STA) Intensified cooperation (CDYCOO)

Sympathy (EMO-SYM) Empathy (EMO-EMP)

Misunderstanding (EMO-MIS)

Complexity (COR-COM) Stress (COR-STR)

Imitation (COR-IMI) Loss of control (COR-LCO)

Client demand (COA-CD) Diversity of offer (COA-DO) Legitimity (COA-LG)

Competitive offer (COA-OFF) Differentiation (COA-DIF) Critical mass (COA-CM)

Interpersonal trust (TRS-INT) Effect on competitors (EEF-CON) Culture (IEF-CUL) Results (IEF-RES)

Effect on partners (EEF-PAR)

Coopetitive strategies in the ICT sector 4. 4.1.

79

Presentation and analysis of results The evolution of the ERP industry


The findings indicate the existence of two successive phases in the evolution of the ERP industry: a start-up phase at the beginning of 1981, followed by a period of development (1989–1999) and by a market restructuring phase (1999 – present day (2012)). This evolution is determined by the progressive development of the ERP market, which becomes both competitive and cooperative, because of the large number of alliances created between software producers, service providers and consulting firms. 4.1.1. The start-up phase (1981–1989) The market creation phase started in 1981 with the first software program for integrated management – SAP R/2 – launched by SAP. At that time, SAP was a relatively small firm (100 employees in 1982), with only a local business reputation. However, by 1988 its number of employees reached 940. The global market was clearly dominated by IBM, a firm that had a partnership with SAP. It is interesting to note that SAP was created by ex-IBM engineers, and used IBM infrastructure and systems for its technological development. During this period, SAP was also collaborating with Oracle, using their expertise in database systems. During this period, the demand for integrated management software had the characteristics of a niche market, the demand being geographically localised and highly specific. Most software providers were small, serving clients from their geographical area. Only a few multinational companies, such as IBM, conducted business at the international level. With the exception of IBM, SAP had very few other competitors – other than Baan, a company located in Holland. 4.1.2. The development phase (1989–1999) After 1989, the ERP market entered a development phase. Investments grew and competitors became more numerous and aggressive. In addition to the newly created firms that became active on the ERP market, a few old companies, such as Oracle, were also attracted by this new sector. During this period, inter-firms collaborations continued to grow. The partnerships created in the previous period were renewed and new alliances were created (e.g. the collaborations between software producers and international consulting firms at the beginning of the 1990s). The growth and internationalisation of the industry forced firms to adopt global strategies. These strategies were reinforced through international partnerships with information systems companies, as well as with the top five global consulting and auditing firms. After 1995, the sector became more competitive. New products were introduced, the existing firms applied aggressive strategies for internal and external development and new competitors appeared in the market. In these conditions, market leaders developed networks of partnerships to diversify their product portfolio through the integration of various competitive offers. Since 1996, SAP became the global leader of the ERP market. SAP and its main challengers (Oracle, JDEdwards, PeopleSoft) applied aggressive strategies to maintain and improve their market positioning. At the same time, a series of new firms penetrated this market. These were software companies producing more specialised applications, but also freeware firms, suppliers of Internet applications, or large software companies such as Microsoft. The competitive actions were characterised by important investments in R&D, financed by stock market flotation, but also by technological innovations and communication strategies designed to reinforce the professional reputation of software developers.



In the second part of this phase (1995–1999) Oracle became a direct competitor of SAP and the number two firm in this sector. Microsoft, the main competitor of IBM, became a close partner of SAP, although the German firm had strong traditional relations with IBM. However, in 1998, following a strategic restructuring, Microsoft created an operational division that directly competes with SAP. In contrast, a series of other companies (Sun, Netscape, Oracle and IBM) launched aggressive strategies in order to destabilise the position of Microsoft on the global ICT market. The appearance of lobbies, interest groups, conflicts, ideological and social pressures increased the complexity of this sector. At the same time, some competing firms initiated common initiatives to improve the intellectual protection of software applications, to promote the creation of freeware or to develop new technological standards. 4.1.3. Market restructuring (1999 – present day) The third period, characterised by market restructuring, starts at the end of the 1990s and continues until today (2012), when ERP has integrated with other software applications (SCM, CRM, etc.) in a market dominated by the leader SAP and its challenger Oracle. During this period, Microsoft decided to diversify its activities by developing new software applications for enterprises and specifically for the ERP market. To achieve this goal, Microsoft acquired a large number of smaller, specialised firms. In response to this aggressive strategy, the other market actors retaliated through competitive actions and new firms attempted to establish a presence on this market. The ERP market became saturated since most of the large companies were by now already equipped with ERP systems. However, some client organisations start to perceive ERP systems as too complex and expensive, and demanded simpler, more flexible applications (e.g. SCM, CRM, SME applications) based on open software systems connected to Internet technology. In order to take advantage of the rapidly developing EAS market, SAP launched its offer of e-business applications – My Sap.com, and created a new partnership with CommerceOne to diversify its competencies. After 2004, the traditional providers of ERP systems diversified their offers including specialised applications and Internet-based services. Microsoft, Oracle and SAP acquired other firms to reinforce their market position for specialised enterprise applications. The market was therefore characterised by concentration and intense competition. However, despite intense rivalry, a series of collective actions (e.g. common patent applications, the development and harmonisation of new standards regarding open software architecture) continued to be jointly organised by the main market competitors. 4.2. The dynamics of inter-firm relations To better understand the evolution of coopetition in the ERP industry, it is important to analyse the dynamics of inter-firm relations (see Table 4). The analysis of the primary and secondary data indicated four main events that changed the relational profile of this industrial sector: (1) In the first period most of these relations were collaborative. A first change intervened in the development phase, when Oracle – the main supplier of databases for SAP – launched in 1995 an alternative offer which directly competed with the German producer. The relationship between SAP and Oracle then became coopetitive, since their initial collaboration continued. (2) A second change is determined by the decision of IBM to focus on integrated services, starting from 1994. As a result, IBM became a direct competitor of Accenture or Cap Gemini, although it also preserved the partnerships with these organisations. In parallel, IBM multiplied its

Firms

Start of coopetition

Period of coopetition

SAP/IBM

1981

Since 1981

SAP/Oracle

1989

Since 1995

SAP/Microsoft

1993

Since 1998

Microsoft/Oracle

End of 1980s

Since 1998

IBM/Oracle

Beginning of 1980s

Since 1990

SAP/Accenture

Since 1987

Since 1987

SAP/Consulting firms

End of 1980s

Since the middle of the 1990s

Explications Since the market launch of SAP products, IBM and SAP are coopetitors, because IBM also developed software applications for enterprises. Since the end of the 1990s, the two firms are engaged in many cooperative and competitive activities (Internet portals, e-business solutions, etc.) In 1995, Oracle has commercialised an ERP system that was directly competing with SAP products. Oracle has progressively invaded the SAP’s market, however, the two firms continued their partnerships In 1998, Microsoft has announced its decision to restructure its activities in the area of ERP. Since then, the two firms are competing on this market, but realise common projects in other areas Microsoft and Oracle are coopetitors on the ERP market since 1998, when Microsoft has entered this market. They are however obliged to collaborate for certain products IBM and Oracle have coopetitive relations since they compete mainly in the area of databases, but, in the same time, they realise many common projects. These firms are in a coopetitive situation since they created their first alliance in 1987. Accenture has, for a long time, developed its own software applications, that were competing with SAP products Although they have complementary rather than competitive offers, the coopetition between SAP and consulting firms is based on a series of competing services



Table 4. The evolution of coopetitive relations in the ERP sector

81


82 E. Pellegrin-Boucher et al. alliances both with traditional and new ERP producers. IBM developed the collaboration with SAP further, because they no longer competed in the area of enterprise software systems and initiated indirect coopetitive relations with some of SAP’s competitors. As a result of its partnerships with I2 and Siebel, IBM was perceived by SAP as one of its more aggressive competitors. (3) A third change is determined by the entrance of Microsoft in the ERP market in 1998, becoming one of the main competitors of SAP. This transformed their traditional partnership into a coopetitive relationship, the two firms continuing to pursue a vertical form of cooperation. (4) Finally, a fourth change is the strategic diversification of SAP in the traditional markets of IBM in 2001. At the same time, IBM continued to develop its expertise in integrated enterprise solutions, competing directly with SAP. As a result, their relation became more coopetitive than in the previous periods. Concerning this situation, an associate of a consulting cabinet declared: ‘Besides its size, IBM has the advantage of being simultaneously a software editor, a hardware developer, and a direct competitor of service agencies’. 5.

Discussion

In order to develop a typology of ERP coopetitive agreements, we adopted the analytical approach used by other authors (Bengtsson and Kock 1999; Branderburger and Nalebuff, 1995, 1996; Gnyawali, Jinyu, and Madhavan 2008): first, we investigated separately the competitive and the collaborative relations developed between ERP companies, and then we analysed the integrated dynamics of these two relations in the context of the ERP value-added chain. 5.1. An increasing competitive aggressiveness Starting from 1995, the ERP sector became more competitive. A first intensification of competition was determined by the entrance of Oracle in this market, which triggers a chain reaction on the part of its rivals. A second intensification of competition took place in 1997, when new competitors and products entered the market (e.g. Internet-integrated software packages). This trend continued in 1998, when Microsoft also became a major player in this sector. In parallel, the traditional ERP suppliers multiply their products and consumer services (e.g. specialised systems for SMEs, Internet technology, system-based services). Since 2001, the intensification of competition became a regular feature of this market. This phenomenon was determined by several causes. First, in conformity with the hyper-competition models developed by D’Aveni (1994), the aggressive actions of Microsoft in 2000 triggered equally aggressive reactions on the part of other firms. Second, market saturation reduced the growth of demand, forcing competing firms to adopt more aggressive strategies (Fjeldstad, Becerra, and Narayanan 2004). Third, the new sectorial innovations, such as open source software or service-oriented architectures, forced firms to adopt new competitive actions, such as price reductions or a diversification of product portfolios. Fourth, since 2003, the intensification of competitive actions corresponded to the acquisition strategy applied by the main market actors, such as Oracle, SAP and Microsoft. As a consequence of these aggressive strategies, competitive actions that were non-existent 10 years before (e.g. comparative advertising, price wars) became a permanent feature of this market. Once the ERP sector became a mature market, it started to attract more opportunistic firms that attempted to access the increasingly scarce competitive resources (Oliver 2004). These firms were either new players or traditional ICT organisations (such as Microsoft) that contributed to



83

the development and saturation of the ERP market. Progressively, the sector became consolidated around several sectorial leaders that pursued an aggressive strategy of mergers and acquisitions. The structural characteristics of the ERP sector enhanced this phenomenon.As in other networkbased industries, the market players initially attempted to integrate their technologies and create associations in order to penetrate the growing market more rapidly (Fjeldstad, Becerra, and Narayanan 2004; Katz and Shapiro 1994). However, when the market became mature, collaborative actions became less frequent, being replaced by competitive approaches that aimed to diversify and develop new technologies. Some firms decided to reduce their costs, while technological leaders tried to take advantage of their own market networks, reducing their participation in sectorial associations. The capacity of companies to exploit network effects favoured technological incompatibility and non-collaboration (Katz and Shapiro 1992). The competitive actions progressively became more aggressive, reducing the chances to develop and maintain collaborative relations (Fjeldstad, Becerra, and Narayanan 2004). The information provided by an alliance manager illustrates this strategic process well: ‘When we start a new project, we try first to multiply the number of partnerships. Then, in the second phase, we attempt to rationalise the diversity and the management of our alliance portfolio’. As the sector developed, the opportunistic approach of some firms intensified, which created distrust among market players. This general lack of confidence created a vicious circle in which the aggressive actions of some competitors and the defensive reactions of other firms successively and continuously reinforced each other (Smith et al. 1991). An alliance manager explained: ‘When I see how much our partner asks us to pay for licenses, I would rather work with a competitor’. 5.2.

The intensification of cooperation between competitors

Despite the intensification of competitive actions after 1994, cooperation continued to develop in the ERP sector. Starting from 2002, the main market players diversified their activity and offers towards e-business applications and new technologies. For example, SAP penetrated the market of Internet servers and portals, while IBM restructured its offer around service-oriented architectures. These competitive pressures forced firms to cooperate again in order to penetrate the emerging markets more rapidly, or to adapt their technology to the new norms and standards. Another reason for renewing traditional partnerships was the necessity to preserve the intercompatibility of various products. However, the new standards imposed by open-source software and new system architectures have also facilitated the creation of professional associations and consortiums. The rapid evolution of the ERP market does not provide the necessary time for strategic acquisitions, forcing the firms to initiate strategic alliances in order to attain a critical mass and reduce the cost of integrating/developing new technologies. As towards the end of the analysed period the clients demanded more flexible systems that permitted the integration of various applications, the software producers were obliged to collaborate not only for commercial activities, but also for developing common technological norms. 5.3. A typology of coopetitive relations in the ERP industry The analysis of competition and cooperation during the analysed period shows a progressive and simultaneous intensification of both types of relations. Depending on the specific situation of various firms, inter-firm coopetition has started at various moments. At industry level, coopetition became a generalised phenomenon in the middle of the 1990s, continuing to intensify afterwards.



Taking into account the evolution of the inter-firm relations, we propose an original typology of coopetitive agreements based on the type of collaboration developed between partner organisations, in the context of the value-added chain of the ERP industry: coopetitive agreements with vertical or with horizontal cooperation. 5.3.1. Coopetition with vertical cooperation Vertical cooperation involves partner firms in a supplier–customer relationships, while they compete either before or after this cooperation phase. This format represents the majority of coopetitive agreements in the ERP industry. Initially, the two firms are involved in a vertical collaboration, then one organisation decides to attack the market of its partner. However, their cooperation continues despite this decision. The relations between SAP and Oracle exemplify this situation well. In the first phase of their relationship, Oracle supplied SAP with the database applications for its ERP products. In 1995, Oracle decided to launch its own ERP products, but the two firms continue their vertical collaboration. Even today, 80% of all SAP applications function on Oracle platforms. Each of these two firms was actively contributing to the success of the other, since Oracle completes the SAP systems with database applications, while SAP products automatically create demand for Oracle databases. 5.3.2. Coopetition with horizontal cooperation In this type of coopetition, two firms collaborate in the value-added chain of activities before or after the phase in which they directly compete, joining resources and competencies in the same area of expertise. Two good illustrations of this type of coopetition are the joint projects Accord 1 and Accord 2 initiated by Accenture and Cap Gemini between 2003 and 2005, to provide and implement complex SAP applications. Often, competing firms collaborate in order to create the critical mass required to satisfy the requirements of a public or private demand. However, these partnerships are strictly limited to the exploitation of a specific market opportunity and are dissolved as soon as this commercial objective has been reached. There are very few such coopetitive agreements in the first stages of the ERP industry, but they became more frequent after the year 2000, to facilitate the adoption of new technological standards, or provide a joint answer to the complex demands of some consumers. Considering the dynamics of inter-firm relations, it is interesting to note that coopetitive situations with vertical cooperations start with a long-term vertical collaboration between two partners, who then become also market rivals, following the competitive attack of one of the partners; in contrast, coopetitive situations with horizontal cooperations are initially based on a competitive confrontation between two firms, followed by punctual horizontal collaborations, when the market interests of the two partners converge (see Figure 2). 5.4. Coopetition stability The existence of coopetition does not imply the stability of inter-firm relations. Within the coopetitive model, the competitive and/or the cooperative actions can evolve very quickly, determined by firms’interest and by the unpredictable market context. Although the coopetitive relation is established on a long-term basis, the intensity of competition and/or cooperation can dynamically fluctuate even on short-term periods. These situations reinforce inter-organisational conflicts (Hamel, Doz, and Prahalad 1989), but also allow the continuance of collaborative agreements, despite the existing competitive tensions.

Coopetitive strategies in the ICT sector t1: Vertical cooperation

85

t3: Vertical Coopetition: Vertical cooperation + Market rivalry t2: Entry in the partner market


t1: Market rivalry

t3: Horizontal Coopetition: Market rivalry + Horizontal cooperation

t2: Cooperation with the rival

Figure 2. A typology of dyadic coopetitive agreements in the ERP industry.

The two forms of coopetition defined in the previous section do not have the same level of stability. Vertical cooperation between competitors creates the necessary conditions for more stable relationships, the firms engaging in long-term collaborations to access complementary resources or capabilities controlled by a competing organisation. A good illustration of this situation is the cooperation between IBM and Oracle concerning database applications, which integrate the IBM specialists in servers and the Oracle experts in databases in joint teams. However, the IBM specialists developing databases for areas other than servers are not involved in this project. Thus, the coopetitive relation is durable because any horizontal cooperation is avoided. The differentiation of organisational resources seems to favour a long-term cooperation between competing partners. However, resource specificity has to be maintained to support a stable relationship, encouraging the partners to collaborate in order to access these complementary resources. On the contrary, in the ERP industry, horizontal coopetition results in lower stability partnerships. Findings indicate that inter-organisational tensions are higher in horizontal collaborations, when the resources and competences of the two partners overlap. When the market context forces competitors to initiate joint projects, their collaboration is specific, with clearly defined objectives, such as the joint promotion of a technological standard, or the integration of dispersed resources in a complex market offer that responds to a complex consumer demand. However, the partnership is dissolved as soon as the objective is realised. There are very few horizontal collaborations between developers of ERP applications, databases or operating systems.

6.

Concluding remarks

Coopetition represents a simultaneous combination of both strategic risks and advantages (Gnyawali and Park 2009). Gaining access to the resources and competencies of another organisation represents an important advantage. However, there is an important risk that the partner organisation absorbs more strategic resources than it provides (Dussauge, Garette, and Mitchell 2000; Hamel, Doz, and Prahalad 1989). In this context, coopetitive agreements are characterised by inter-organisational tensions, which induce a situation of permanent instability. Focusing on the ICT sector, this study attempted to identify and explain the factors that determine the


86 E. Pellegrin-Boucher et al. stability of some coopetitive agreements, a topic still insufficiently explored in the existing literature. The results of this study confirm the complexity and the inevitability of coopetition in the ERP industry. Among the factors determining this strong organisational orientation towards coopetition we can outline: the globalisation, the increasing and evolving competition, a multiplication of distribution networks, the ‘lock-in’ effect, the risk and unpredictability of market evolution, the convergence of ICT technologies and the harmonisation of international standards. These trends force ICT organisations to initiate coopetitive agreements, however, the stability of these relations is variable. These findings have important consequences both for strategic management research and for practitioners. From an academic point of view, they show that coopetition represents a new standard of strategic performance (Brandenburger and Nalebuff 1996) in the ERP industry. In contrast, the format of collaborative relations between competing partners provides a clear explanation regarding the stability of joint projects: a horizontal form of collaboration seems to exacerbate inter-organisational tensions, while a vertical cooperation creates favourable conditions for long-term partnerships, as long as the firms preserve their resource specificity. From a managerial perspective, the capacity to develop and maintain a long-term coopetitive strategy is paramount for firm success. The findings of this study can increase managers’ knowledge and understanding regarding the structure and the dynamics of coopetitive projects, helping them to take the necessary measures to ensure the stability and success of coopetitive partnerships. Considering the findings of this study, we can make a series of propositions that can enhance the management of coopetitive agreements: (1) The managers should clearly evaluate the specific advantages and risks of each coopetitive agreement in the planning phase – this information can help alliance managers to negotiate more favourable conditions for the organisation, targeting the potential advantages and reducing or eliminating the possible risks; (2) Vertical collaborations with competitors should be based on the complementarity of organisational resources and competencies; the success and stability of this type of partnership depends on the capacity of partner organisations to preserve resource specificity; (3) Horizontal collaborations with competing firms should be based on the need to develop a critical mass of similar resources to take advantage of punctual, well-defined market opportunities; since the risks of opportunistic behaviour are higher in this case, managers should attempt to limit coopetition risks and manage the tensions created by this collaboration. However, these conclusions should be considered by taking into account the limits of this study. The research was conducted for a specific industrial sector, the ERP market, and for a specific time period. It is possible that coopetitive strategies have a different importance and manifestation in other industrial sectors, or in different time periods. However, considering that the ERP sector is very representative of the ICT industry, we can assume the existence of similar trends in other ICT sectors. However, considering that the specific characteristics of the ICT industry have determined the appearance of advanced strategic practices, we can presume that similar strategic changes took place in other high-tech sectors. This proposition is supported by the evidence provided by Gnyawali and Park (2011) regarding the long-term horizontal cooperation between Samsung and Sony in the area of television screens. In this case, further investigation is required to understand the factors that permit a stable coopetitive relation between these two market leaders, in a situation of horizontal cooperation.


87


The originality of this study is given by its specific focus on the evolution of coopetitive relations within, which permits the development of a specific typology of coopetitive agreements and the evaluation of their stability. The tensions induced by the specific risks of coopetitive partnerships represent a reality that needs to be properly structured and managed. Since these tensions are linked to the very nature of coopetitive agreements, they cannot be completely eliminated, but rather limited and expressed without endangering the relationship between the two partners. One such solution is given by a vertical collaboration in which competitive tensions are balanced by the need for complementary resources and competencies. Although these findings are interesting, they should be validated and complemented by further research regarding the inter-organisational dynamics between coopetition partners.

Notes on contributors Estelle Pellegrin-Boucher is Associate Professor at the University of Montpellier I, France. Her research interests focus on coopetition, sales and marketing strategies and consulting. Frédéric Le Roy is professor at the University Montpellier I, and at GSCM – Montpellier Business School, in France. He coordinates the university research laboratory ERFI. His research interests are focused, on the one hand, on competition strategies, and, on the other hand, on entrepreneurship in high-technology sectors. He has published many academic articles, as well as several books on these topics. C˘alin Gur˘au is Associate Professor of Marketing at GSCM – Montpellier Business School, France, since October 2004. His present research interests focus on the business strategies of SMEs, high-technology marketing and marketing strategies on the Internet.

References Arthur, B. 1989. Competing technologies, increasing returns, and lock-in by historical events. The Economic Journal 99: 116–32. Arthur, B. 1994. Increasing returns and path dependence in the economy. Ann Arbor: University of Michigan Press. Bengtsson, M., and S. Kock. 1999. Cooperation and competition in relationships between competitors in business networks. Journal of Business and Industrial Marketing 14: 178–90. Bengtsson, M., and S. Kock. 2000. Coopetition in business networks – to cooperate and compete simultaneously. Industrial Marketing Management 29: 411–26. Bonel, E., and E. Rocco. 2007. Coopeting to survive; surviving Coopetition. International Studies of Management & Organization 37: 70–96. Brandenburger, A.M., and B.J. Nalebuff. 1995. The right game: Use game theory to shape strategy. Harvard Business Review 73: 57–71. Brandenburger, A.M., and B.J. Nalebuff. 1996. Co-opetition. New York: Doubleday. D’Aveni, R.1994. Hypercompetition: Managing the dynamics of strategic maneuvering. New York: Free Press. Dagnino, G.B. 2009. Coopetition strategy. A new kind of interfirm dynamics for value creation. In Coopetition strategy, ed. G.B. Dagnino and E. Rocco, 25–43. Abingdon, Oxon: Routledge. Dittrich, K., and G. Duysters. 2007. Networking as a means to strategy change: The case of open innovation in mobile telephony. Journal of Product Innovation Management 24: 510–21. Dussauge, P., B. Garette, and W. Mitchell. 2000. Learning from competing partners: Outcome and durations of scale and link alliances in Europe, North America and Asia. Strategic Management Journal 21: 99–126. Dyer, H., and H. Singh. 1998. The relational view: Cooperative strategy and sources of interorganizational competitive advantage. Academy of Management Review 23: 660–79. Eliashberg, J., and T.S. Robertson. 1988. New product pre-announcing behavior: A market signaling study. Journal of Marketing Research 25: 282–93. Eisenhardt, K.M. 1989. Building theories from case study research. Academy of Management Review 14: 532–50. Fjeldstad, Ø.D., M. Becerra, and S. Narayanan. 2004. Strategic action in network industries: An empirical analysis of the European mobile phone industry. Scandinavian Journal of Management 20: 173–97.


88 E. Pellegrin-Boucher et al. Gomes-Casseres, B. 1994. Group versus group: How alliance networks compete. Harvard Business Review 72: 62–71. Gnyawali, D.R., H. Jinyu, and R. Madhavan. 2006. Impact of coopetition on firm competitive behavior: An empirical examination. Journal of Management 32: 507–30. Gnyawali, D.R., H. Jinyu, and R. Madhavan. 2008. Coopetition promises and challenges. In The 21st century management: A reference handbook, ed. C. Wankel, 386–98. San Francisco, CA: Sage. Gnyawali, D.R., and B.-J. Park. 2009. Coopetition and technological innovation in small and medium-sized enterprises: A multilevel conceptual model. Journal of Small Business Management 47: 308–30. Gnyawali, D.R., and B.-J. Park. 2011. Co-opetition between giants: Collaboration with competitors for technological innovation. Research Policy 40, no. 5: 650–63. Gueguen, G. 2009. Coopetition and business ecosystems in the information technology sector: The example of intelligent mobile terminals. International Journal of Entrepreneurship and Small Business 8: 135–53. Guidice, R., A. Vasudevan, and G. Duysters. 2003. From ‘me against you’ to ‘us against them’: Alliance formation based on inter-alliance rivalry. Scandinavian Journal of Management 19: 135–43. Hamel, G. 1991. Competition for competence and inter-partner learning within international strategic alliances. Strategic Management Journal 12: 83–104. Hamel, G., Y.L. Doz, and C.K. Prahalad. 1989. Collaborate with your competitors and win. Harvard Business Review 67: 133–39. Henderson, B.D. 1983. The anatomy of competition. Journal of Marketing 47: 7–11. Jacobides, G.M., and S. Billinger. 2006. Designing the boundaries of the firm: From ‘make, buy, or ally’ to the dynamic benefits of vertical architecture. Organization Science 17: 249–61. Katz, M.L., and C. Shapiro. 1992. Product introduction with network externalities. Journal of Industrial Organization 40: 50–83. Katz, M.L., and C. Shapiro. 1994. Systems competition and network effects. The Journal of Economic Perspectives 8: 93–116. Lado, A., N. Boyd, and S.C. Hanlon. 1997. Competition, cooperation, and the search for economic rents: A syncretic model. Academy of Management Review 22: 110–41. Lamberg, J.-A., N.J. Ojala, and P. Sajasalo. 2007. The evolution of competitive strategies in global forest industries. Dordrecht: Springer. Lei, D., J.W. Slocum, and R.A. Pitts. 1997. Designing organizations for competitive advantage: The power of unlearning and learning. Organizational Dynamics 27: 39–53. Luo, Y. 2004. Coopetition in international business. Copenhagen: Copenhagen Business School Press. Luo, Y. 2005. Toward coopetition with a multinational enterprise: A perspective from foreign subsidiaries. Journal of World Business 40: 71–90. M’Chirgui, Z. 2005. The economics of the smart card industry: Towards coopetitive strategies? Economics of Innovation and New Technology 14: 455–77. Miles, B.M., and M. Huberman. 2003. Analyse des données qualitatives. Bruxelles: De Boeck. Oliver, L.A. 2004. On the duality of competition and collaboration: Network-based knowledge relations in the biotechnology industry. Scandinavian Journal of Management, 20: 151–71. Padula, G., and G.B. Dagnino. 2007. Untangling the rise of coopetition. International Studies of Management & Organization 37: 32–52. Park, H.S., and M.V. Russo. 1996. When competition eclipses cooperation: An event history analysis of joint venture failure. Management Science 42: 875–90. Porter, M.E. 1991. Toward a dynamic theory of strategy. Strategic Management Journal 12: 95–117. Powell, P.W., and P. Brantley. 1992. Competitive cooperation in biotechnology: Learning through networks. In Networks and organizations, structure, form and actions, ed. N. Nohria and R.G. Eccles, 366–94. Boston, MA: Harvard Business School Press. Quintana-García, C., and C.A. Benavides-Velasco. 2004. Cooperation, competition, and innovative capability: A panel data of European dedicated biotechnology firms. Technovation 24: 927–38. Ritala, P., and P. Hurmelinna-Laukkanen. 2009. What’s in it for me? Creating and appropriating value in innovation-related coopetition. Technovation 29: 819–28. Ritala, P., P. Hurmelinna-Laukkanen, and K. Blomquist. 2009. Tug of war in innovation – coopetitive service development. International Journal of Services Technology and Management 12: 255–72. Rusko, R. 2011. Exploring the concept of coopetition: A typology for the strategic moves of the Finnish forest industry. Industrial Marketing Management 40: 311–20. Shapiro, C., and H.R. Varian. 1999. Information rules. Harvard, MA: Harvard Business Press.


89


Smith, K.G., C.M. Grimm, M.J. Gannon, and M.J. Chen. 1991. Organizational information processing, competitive responses, and performance in the U.S. domestic airline industry. Academy of Management Journal 34: 60–85. Yami, S., S. Castaldo., G.B. Dagnino, and F. Le Roy. 2010. Coopetition: Winning strategies for the 21st century. Cheltenham: Edward Elgar. Yin, R.K. 1989. Case study research: Design and methods. Newbury Park, CA: Sage.