The present paper explores the impact that co-opetition - simultaneous cooperation and competition - has on organizational performance, proposing that performance of organizations is contingent upon the embeddedness of firms in a network of inter-organizational relationships. To explore the effects on performance resulting from both collaborative network ties and competitive relationships between organizations, we used panel data collected between 2003-2007 from 31 hospitals in Abruzzo, one of the most populated regions of the central Italy. We employed secondary data of hospital activities regarding both clinical and administrative aspects. For each year, we examined the intensity of inter-hospital competition and the unique position each provider has within a larger network of relationships with other hospitals. As well, other idiosyncratic organizational characteristics were examined. Our results show that hospital performance is both negatively related to the degree of competition an organization faces, and positively related to the degree with which hospitals establish collaborative relationships. We also found that the negative impact on organizational performance due to competitive aggressiveness was lessened when hospitals were more likely to create cooperative network ties.
Keywords: Organizational performance, hospitals, co-opetition, inter-organizational rivalry, network ties, social network analysis, productivity