The existing argument about the relationship among business competitors focuses on cooperative or competitive relationships between them, with one of the relationships often seen as threatening or harming the other.
There needs to be more focus or research that two competing businesses could mutually benefit and upscale their operations by cooperating simultaneously. Therefore, both types of relationships need to be highlighted simultaneously.
“We are not just here to compete, but also to collaborate,” Erika Dizon-Go, senior vice president and head of Fintech Business Group and Open Finance and Digital Services Center of Excellence at UnionBank of the Philippines.
She explained that the old business model of a “winner takes all,” or either you win or lose, is already obsolete. According to Go, although “coopetition” is counter-intuitive, the emerging networked-economy strategy could provide more advantages to companies if they cooperate and compete with each other.
“In the case with GCash, although UnionBank has its e-wallet service, we need to look at cooperating with other e-wallet services so we can link all these systems that would allow users to top-up their various e-wallets using their UnionBank accounts,” Go explained.
[caption id="attachment_52934" align="aligncenter" width="1673"]
INCLUSION gets a strong nudge. | PHOTOGRAPH COURTESY OF XENDIT[/caption]
UnionBank is allowing third-party financial institutions, like GCash or e-wallet service providers, to tap into its system through its API (application programming interface) to allow the seamless integration of their operations.
With the integration or collaboration among banks, e-wallets providers, and other financial institutions, consumers can use their e-wallets not just to transfer money but also to secure loans, buy investments, save money, transact with their banks, accept payments, and more importantly, build their digital financial footprints to access financial services, Go said.
“E-wallets are not just about sending money anymore,” Go added. “Some use it to invest or secure a loan through their e-wallet. UnionBank is trying to empower consumers, so we are building our network with the various financial institutions.”
‘Coopetition’
As Go explained, coopetition is a business model that utilizes the insights gained from existing strategies with the understanding that competitors should collaborate on specific aspects of their operations.
“Even if we are competitors, there are areas where we can work together,” she added.
The hybrid concept of cooperation strategy was first introduced to the business psyche by Harvard University and Yale business professors Adam M. Brandenburger and Barry J. Nalebuff in the mid-1990s. The two professors published a book called Co-opetition in 1996, detailing how cooperative and positive thinkers can make idea work.
Brandenburger and Nalebuff suggested that competitors must change their mindsets and stop competing, but rather become friends and work together to gain bigger profits, upscale their operations, achieve more incredible benefits, and grow simultaneously.
Coopetition strategy
According to Go, the coopetition strategy involves a network of shareholders and competitors collaborating to achieve the highest value for their goals.
The development of digital technology has advanced the concept of the coopetition strategy as the business models shifted to building networks and cross-border expansion of operations.
Cooperation is more mutually beneficial than active competition as it allows companies to expand their business to new horizons, establish favorable relationships, and increase their knowledge in the corporate world.
She said that gone were the days when business owners were looking to beat their competitors in a cut-throat business environment. Go noted that today’s business buzzword is working together to achieve shared goals and principles.
“Again, thanks to the development of digital technology and the mass adoption of the Internet, connecting with your customers, shareholders, and competitors are faster and more efficient. Digital technology made keeping in touch with customers and even interacting with your competitors to share ideas and develop a relationship by working together to perform better things allow faster and more tremendous success,” Go said.
[caption id="attachment_52932" align="aligncenter" width="1500"]
UB’s partner financial service providers.[/caption]
“We plan to embed our banking services to as many partners as possible. Instead of competing with e-wallets, we cooperate with them and embed financial services, like lending or credit card applications, to promote financial inclusion, particularly to the most vulnerable and unserved sectors. No will be left behind,” Go added.
The post Coopetition: Competing and cooperating while succeeding appeared first on Daily Tribune.