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Is Competition A Good Thing?

Is Competition a Good Thing?

Is competition in the workplace a good thing? Some argue that it drives self-improvement and creativity in its quest to deliver results. Others argue that a competitive environment is a slippery slope to rivalries, backstabbing and information hording.

These are questions that leaders must take into consideration when thinking about motivation, productivity and company culture.

 

Competition Works…Sort of…

Some research studies have shown that that competition can motivate employees to put in more effort and achieve greater results. Many sales or high production environments rely on competition to consistently increase output. This often spurs creativity, innovation and an aspiration to perform at one’s best.

However, high pressure, highly competitive environments can lead to anxiety, fear and unethical behavior.

Years ago, I witnessed an unhealthy rivalry develop between two of the top producing sales people in the office I worked in at the time. While it started as fun, with lighthearted teasing and a healthy competitive vibe, it quickly took a dark turn. Before all was said and done, there were accusations of client poaching and one of the sales people lost his job for creating fake deals and other unethical behavior.

In a more recent and well known example, Wells Fargo made the news in 2018 because employees delivered higher sales numbers by covertly creating millions of unauthorized bank and credit card accounts.

What went wrong in these cases? If competition is supposed to make us more creative, how were these individuals driven to unethical behavior in the pursuit of achieving “higher numbers?”

According to Harvard Business Review, the difference between healthy competition and the path to unethical behavior is predicated on two things: Fear and the threat of a negative outcome.

Imagine sitting in a sales meeting with 35 other sales people. You missed your quota for the month and you have to stand up and explain why in front of the entire group. You are met with “boos!” and shouts of “loser!” while you’re talking. When you’re done, the sales manager reminds you that as a result of your poor performance this month, you are no longer eligible for the cash incentive. “You’d better catch up next month,” he says, “or else.”

Sounds horrifying right?  There’s an undertone of fear here, not just fear of underperformance but fear of being humiliated in front of peers and fear of negative outcomes (losing the cash incentive.)

 

Do this Instead:

I recently worked with an organization who managed to tap into healthy competition to exceed their sales goals for several quarters in a row. They got all the creativity and motivation from the competition and none of the unhealthy rivalries or unethical behaviors. Here’s how they did it.

The Sales Director, in partnership with other department directors, created several different teams. Each team comprised of a few sales people and several others from different areas of the company like marketing and operations. Each team was given the same quarterly sales goal.

What happened was amazing. Each created a unique strategy to approach the goal. Team members figured out how to tap each other’s strengths.  Team members encouraged and helped one another.  At the end of quarter every single team had exceeded the initial sales goal.

So, how does a leader go about creating an environment of innovation, creativity and results with healthy competition?

  • First, make sure that everyone on is well trained. People who are new in their jobs or haven’t had all of the training they need tend to feel more anxiety about competing with others.
  • Work from a place of collaboration where questions can be asked and there is a system of support. Competition without collaboration creates winners and losers and doesn’t work.
  • Focus on positive outcomes. Say “If we reach out goal-we’ll get that cash prize!!” Instead of “If we lose, we miss out on the cash prize.”
  • Take fear out of the equation. Threats of poor performance reviews, humiliation, or job loss are demotivating and stifle engagement.
  • Know what motivates each employee. About 50% of employees are motivated by interoffice competition. 25% are indifferent and the remaining 25% of employees are discouraged by it.

While competition can improve performance, leaders must ensure that it sparks creativity while avoiding unethical behavior. Leaders can accomplish this by working within a collaborative model and relinquishing fear based tactics.

Would you like more information on healthy workplace competition or building company culture? Contact our experts at info@pathfinder-strategies.com or by phone at (888) 529-0240.

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