In this series about organisational transformation, I assert that particularly when a crisis is large, competitive players must consider collaborating. When I mentioned this recently, the responses were interesting—from ‘great idea’ to ‘theoretical’ to ‘there is no real-life example of competitors co-operating’. From my repertoire of stories on collaborative competitors, I offer some examples. In these times of increasingly competitive politics and enterprise, there are relevant lessons.
Politics and business are really not the same as war. They are not games of winners and losers. A “China-free world” or a “Republican-free America” are both silly ideas. Unfortunately, a motivational narrative has developed that winning is not only all-important, but decimating or crushing competition is equally crucial.
In 1959, octogenarian Somerset Maugham is reported to have said, “It is not enough to succeed, others must fail.” This was made memorable during the 1996 Olympics by the Nike Air television advertisement, starring basketball player Lisa Leslie saying, “You don’t win silver, you lose gold.” The new mantra for e-commerce start-ups of ‘winners take all’ is announced periodically. New unicorns with irrational valuations are lauded at regular intervals. The absence of family planning among the community of unicorns causes me economic concerns.
Politics and business are not about annihilating competition. They are not zero-sum games as pointed out by Simon Sinek in The Infinite Game. Many areas of human endeavour involve multiple interdependent variables. Simple decisions that ignore the total system effect are counterproductive. That is why game theory offers great insight. Read the fascinating 1996 book Co-opetition that identified five elements in a game, with the acronym PARTS—Players, Added-values, Rules, Tactics and Scope.
On 9 January 2009, Ramalinga Raju, Chairman and CEO of Satyam, admitted that he had undertaken a massive fraud, news that shook the foundations of the upcoming Indian software industry and its relations with worldwide clients. Recently, I had occasion to listen to The Satyam Saga, a rich discussion hosted on Live History. Its founder Mini Menon interviewed three key players who were deeply involved in resolving the crisis—Kiran Karnik, Ganesh Natarajan (former president and incumbent chairman respectively of NASSCOM) and C P Gurnani, CEO of Tech Mahindra, the company that bought Satyam. Kiran Karnik has also written The Coalition of Competitors.
Five important lessons for engaging in successful co-opetition:
i. Do not lose time proving that this crisis is unique and rare. Every crisis is unique and rare.
ii. Do not waste time finding who is at fault. Act fast and with a strong feedback loop to correct inevitable mistakes.
iii. Bring in proven and broad leaders to sort out the problem, not just domain or technical experts.
iv. Focus communication on employees who are bound to feel insecure. Exhort, persuade, cajole players that cooperation can expand the pie for all. Later, competition will determine how to divide the expanded pie. Some players will act out of line, but many do heed this.
v. Be respectful of and invoke the help of the whole ecosystem—government, employees, customers, players and bureaucrats. For example, in the Satyam resolution, the key players were Secretary, Company Affairs Anurag Goel; Nasscom President Som Mittal; HDFC Chairman Deepak Parekh; bureaucrats Achuthan and Manoharan; just to name a few.
Here are other examples of co-opetition:
In 1982, Lipton India was in a financial crisis. As its only competitor at that time, Brooke Bond India was concerned. Chairman C S Samuel persuaded Unilever to avoid winding up Lipton India. Why? Because his company needed Lipton’s competition. In 2005, Toyota Motors Chairman Hiroshi Okuda took positive steps to save General Motors from the combined onslaught of Toyota, Honda and Nissan in the US automobile market. In India’s current telecom market, can three players show such statesmanship?
In 1995, Nelson Mandela wore the Springboks all-white rugby team jersey to dilute memories of apartheid in a tormented South Africa. Recall the summer of 1996, when the shaky Narasimha Rao government felt compelled in the national interest to buy Sukhoi-30 aircraft from Russia. Journalist Shekhar Gupta has narrated how, through deft interventions and collaborative consultations, some arch-rivals collaborated—Congress’s Narasimha Rao, BJP’s Jaswant Singh and Vajpayee, and SP’s Mulayam Singh—to avert public controversy. Players in the Rafale fighter purchase may please note.
Biographer Dorothy Kearns Goodwin wrote about how the American Republic in the 1860s was saved by Abraham Lincoln and his rivals in A Team of Rivals. Many republics need similar saving these days.
Surely there are sane lessons to be learnt. Apply the stated five principles to how nations responded to their Covid crises. Consider how countries manage their multiethnic and multicultural populations.
Author and corporate advisor
(The author had served as Director, Tata Sons and, before that, as Vice Chairman, Hindustan Unilever)