The objective of the paper is to develop an analytical tool that is capable of modelling
decision-making in coopetitive business relationships. Managers in the same industry
differ in respect of their willingness to adopt coopetition. To better understand
coopetitive decision-making, we need a model whereby such decisions can be experimented
with and analysed. An important prerequisite of such a model would be its capacity
to measure the performance consequences of coopetitive interactions at both firm and
relationship levels. We show that existing operationalisation has limited capacity
to do that. Based on existing game theoretical constructs, we propose a new operationalisation
of a coopetitive decision-making episode in horizontal business relationships using
a two-step sequential game. We suggest developing what we term a “coopetitive composite
solution matrix” by summing up the payoff functions of the two steps of the game.
The suggested operationalisation has the capacity to measure all the potential performance
consequences of a complex piece of coopetitive decision-making in an episode. In this
way, the decision problem’s cognitive representation becomes straightforward and analysis
of the impact of the behavioural attributes of managers on the actual decision-making
process is unambiguous.