1. SLEEPING WITH THE ENEMY: Doing Business
with a Competitor
Author: Barbara A. Carlin, Michael J. Dowling, William
D. Roering, John Wyman, John Kalinoglou and Greg
Clyburn
Anthony Kojo Ayivi
Sajeewani Ponnamperuma Arachchige

2. Forming relationship with a competitor
•Multifaceted relationships
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3. … With Enemy
Technology: Only supplier
of specific parts Regulation Legal Requirement
Globalization: do
business in other
countries
Size and Structure: - More
Diversification leads to
different market
Outsourcing -
increasing trend
of outsourcing
Products: More
opportunities with linkages
Driving Forces: Why Do Business with Enemy
Firm’s image: Improves
doing business with
market Leader

4. Why important? : Rewards and Risks
• Relationships with suppliers/ customers give benefits in business
• Sharing information with them without being endangering its
competitive position is very important
• It has became an increasingly important issue in global business
BUT must be managed well because of ….
• Some drawbacks
– risk of giving information
– risk of crossing the line between cagey negotiations and unethical
behaviors
– Difficult to justify the cost of centralizing management
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5. Types of Multifaceted Relationships
1. Buyer-Supplier in Direct Competition
Eg: IBM and Intel
Firm A
Intel
(supplier)
Firm B
IBM
(Buyer)
Product
Super
computers
Product
Super
computers
Microprocessors
Competition in the
Market
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6. Types of Multifaceted Relationships
2. Partners in Competition
Eg: IBM and Apple
Firm A
IBM
Firm B
Apple
Product
Personal
computers
Product
Personal
computers
Joint venture to
create New PC
Operating System
Competition in the
Market
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7. Types of Multifaceted Relationships
3. Buyer-Supplier in Indirect Competition
Eg: Microsoft and Apple
Legal
Microsoft
defending lawsuit
Legal
Apple suing
Microsoft
Firm A
Microsoft
(Supplier)
Firm B
Apple
(Buyer)
Competition in
Legal Arena
Competition in the
Market
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8. How to Manage Multifaceted Relationships
Management strategies ranging from complete avoidance to
total involvement
1. Stay away or get out: costly
2. Divide and conquer: separating interactions with competitor
– having different departments or divisions
– using product or geographic divisions by large companies
– Can behave as there is no relationship
Best strategy for companies engaged unwillingly in relationships or
cultures and leadership emphasize competition rather than
collaboration
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9. How to Manage Multifaceted Relationships
3. Centralize Intelligence
– increase benefits of multifaceted relationship
– manage risk of coordination
– combine information to see what can be learned:
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10. Sources Story: BellSouth Corporation
Moved from: Traditional approach - Decentralized
To: Centralized Approach
• Enhanced Information sharing and
• Helped improve overall business effectiveness and Efficiency
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11. Conclusion
• All firms should launch multifaceted relationships
– Efficient, high quality supply or best prices
– Improve decision making
Companies with tolerance of risk, culture of understanding
collaboration, corporate strategy of emphasizing new
opportunities flexible leadership will be successful in
centralizing information
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12. References
Dawling, M. J., Carlin, B. A., Roering, W. D., Wyman, J.,
Kalinoglou, J., & Clyburn, G. (1994). Sleeping with the Enemy:
Doing Business with a Competitor. Business Horizon , 37 (5),
9-15.
Turban, E., Sharda, R., Delen, D., & King, D. (2011). Business
Intelligence: A Managerial Approach (International Edition
ed.). New Jersey, USA: Person Education Inc.
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