The Paradox of Cooperation and Competition in Strategic Alliances: Towards a Multi-paradigm Approach

INTRODUCTION
In the 1970s and early 1980s, the strategic challenge for business was viewed primarily as protecting its potential profits from erosion through either competition or bargaining. This view of strategy underwent a change in the late 1980s. The need to pursue multiple sources of competitive advantage led to the need for building collaborative relationships with suppliers, customers, competitors, and variety of other institutions (Bartlett & Ghoshal, 2000). Many companies shifted strategic focus and began to embrace both competitive and cooperative strategies. The growing role of cooperative strategy is manifest particularly in the phenomenon of strategic alliances (Bartlett & Ghoshal, 2000), which are interfirm cooperation agreements to share or transfer skills and resources to meet mutually agreed goals.
Cooperation or collaboration can be considered as a counterpart to the pursuit of competitive advantage. It can offer significant advantages for companies, which are lacking in particular competencies or resources to secure these through links with others possessing complementary skills and assets (Child & Faulkner, 1998; Dyer & Singh, 1998). …