Abstract

In this chapter, we develop a fundamental understanding of an essential yet overlooked component of alliance capability, namely coopetition capability. We suggest that coopetition capability, based on three dimensions—analytical, balancing, and emotional—reflects managers’ ability to handle paradoxical demands. This capability is especially helpful and needed to deal with coopetition paradox and the resultant paradoxical tension. Coopetition capability not only allows firms to balance their cooperative and competitive interactions but also helps managers to keep a moderate level of tension to boost performance outcomes.