Perils of Competition

I heard a thought provoking talk by Margaret Heffernan recently. She is a business thinker and advisor to CEO’s whose TED talk has had 2 million views. The topic was about the often unintended negative consequences of businesses and a country obsessed with competition and winning.

Tell me if any of this sounds familiar:

• “The only thing that matters is getting results.”
• “I need to make a name for myself in the company. That doesn’t happen by helping someone else.”
• “We use forced rankings for our performance reviews.”
• “We have an employee of the month.”

Those all reflect how we create high performance and achieve our goals, right? From the research Heffernan has done and, quite honestly, from our own experiences, that is often not true. What are some of the real consequences of the thinking reflected in these statements? Let’s take a look:

When the only thing that matters is getting results, how you get those results can promote very bad behavior. Look at the cheating scandals at universities. Think about the decisions financial institutions made that led to the financial crisis. Think about some of the people you’ve known who will do anything to win. It’s not pretty.

When career success hinges on how I and I alone make a name for myself, I won’t share information or expertise. I will maximize my performance and in the process sub-optimize the performance of others.

Forced rankings promote mediocrity. If only a small percentage can ever be ‘superstars’ then it doesn’t really matter if I work really hard because I probably won’t join them. The odds are not in my favor. On top of that, if I become part of that group, the game becomes too costly for me if I fail.

By having any recognition system that only rewards one person or a very small number of people, like employee of the month, the vast majority of your people are demotivated. Again, if only one of us can win, the odds are that I won’t be one of them.

Heffernan suggests that promoting collaborative behavior will lead to far greater success. Her research shows that companies that have long-term success not only measure and reward results, but put an equal emphasis on how one got results. They have cultural norms that promote people spending time in conversation and congregation with each other. She told the story of one company that did not allow coffee mugs on desks. It was not because they didn’t like how coffee mugs looked or feared a spill. They wanted people to get away from their desks and congregate around the coffee maker so the would begin to have conversations with each other and share ideas about their work and where the company was going.

What’s the norm at your company — collaboration or competition?