How Coopetition Influences the Development of a Dominant Design: Evidence from the Pinball Industry

Abstract

Most studies concerning dominant designs focus on ‘collective’ or ‘competitive’ strategies that companies deploy to impose their choices on the market. The objective of this research is to assess the extent to which ‘coopetitive’ strategies may lead to a dominant design. We analyzed the development of a dominant design over an 84-year period through a historical study in the field of pinball machines. Our study focuses on the five main manufacturers of pinball machines and analyzes data from 1930 to 2014. We demonstrate that companies undergo three phases that involve the progressive development of coopetitive relationships with different impacts on the generation of innovation. Because manufacturers differentiated their offerings, innovated and simultaneously imitated others, increased competition resulted. Simultaneously, external threats and the need to collectively respond to clients and partners prompted the manufacturers to cooperate with one another. Thus, our research provides a better understanding of how specific horizontal coopetitive relationships among manufacturers of the same type of products impact the development of a dominant design at the industry level. This case study suggests that as a theoretical framework, coopetition introduces new insights into the comprehension of relational dynamics during the development of dominant designs. Our observations also confirm or invalidate conclusions drawn in previous works related to coopetition strategies. In particular, this case is interesting as although the appropriability regime was weak, companies still developed coopetitive relationships, contradicting previous studies.

Keywords

• coopetition
• dominant design
• historical analysis
• innovation
• pinball