Managing co-opetition for shared value in nonprofit/for-profit organizations: Lessons from the U.S. hospital sector

Changes in industry environments through technological and regulatory disruption can prompt the evolution of new organizational structures as a means to both survive in a highly competitive marketplace and create shared value. When organizations convert to a hybrid nonprofit/for-profit organizational form, this often fosters the adoption of intrafirm co-opetition, or the simultaneous cooperation and competition between units, challenging the governance of the organization. We examine this phenomenon within the hospital industry. We address the challenges of managing co-opetition between and amongst units, and we provide recommendations regarding controls and incentives that promote shared value along service and factor market lines. These lessons can apply to all hybrid nonprofit/for-profit firms where human resources have significant bargaining power across units.