Is Competition Killing Your Productivity?

Like any weapon, competition needs to be handled with care. Here, we explore how to foster collaboration-boosting competition without slipping into toxic everyone-for-themselves territory.

Is Competition Killing Your Productivity?
[Image: Flickr user Andi Sidwell]

Landing a job at a competitive, well-known company would be a coup for any person at any stage of their career. But when Jody Kinner got a job at Groupon, competitive took on a whole different meaning.


The department of merchant research functioned a lot like a sales division. “We were given quotas to hit every day, starting basically in your first week after a couple hours of training, you are compared to everyone else in the department,” Kinner (who agreed to be interviewed under the condition that we didn’t use a real name) tells Fast Company. The company kept a running list so everyone could see how their peers were performing throughout the day. Highest and lowest scores were broadcast weekly, with top performers earning time off, work from home, even pizza parties.

Those who didn’t make the cut? “Every day, if you were in the bottom, even if it was one number below the number you were supposed to hit, a supervisor would call you out, tell you how to improve your numbers, what you felt you could do better, and why you weren’t measuring up to everyone else.”

Rather than work as an effective feedback tool for motivation, Jody reports that the tactic had just the opposite effect on staffers. “People are so frantic to hit their research quotas that no one talks to each other. All day, not one word, because you know you literally have no seconds to waste.” Hours of unpaid work and no lunch breaks notwithstanding, according to Jody, the weekly public “shaming” translated to coworkers who didn’t acknowledge people with lower numbers. “Almost everyone working there was miserable, you could see it on their face, and I never heard one positive thing about the department.”

Death to Competition

Jody left Groupon before its recent CEO shuffle in search of a less hostile environment. But plenty of workers at other businesses keep their heads down to keep their performance metrics up, often to the detriment of collaboration and innovation. That’s why Paul Baard, professor of Organizational Psychology at Fordham University, says, “The old adage ‘competition brings out the best in people’ deserves a proper burial.”

Rather than look at winners versus losers in the workplace, Baard suggests looking at motivation along a continuum that ranges from extrinsic (“What can I earn or win in doing this task?“) to intrinsic (“What can I enjoy by doing this?”).


“While an extrinsically incentivized employee can be quite productive in the short term,” Baard explains, over time they can suffer from anxiety, burnout, and lack of collaboration. “Internal competition is also associated with extrinsic motivation and brings out a host of maladaptive behaviors, for exampls cheating and undermining others,” he observes. Things go further downhill, says David Lewis, president and CEO of OperationsInc, a human resources outsourcing and consulting firm, when management encourages bad behavior. “Managers often screw up good organizations by favoring the aggressive competitors, thereby demotivating the lesser cogs who are critical to the success of the organization.”

On the flip side, Baard says that research finds that a worker inclined toward thinking of meeting and beating goals as something to be enjoyed is more creative, collaborative, and persistent.

Threat or Challenge?

How to fuel the feel-good kind of competition, rather than its destructive counterpart? First, as with anything, it’s important to assess how competition is perceived by the brain. If it’s like Jody’s experience at Groupon, where not making the numbers results in public shaming and worse, it’s a threat that sends the brain scurrying into its unproductive critter state.

If the company’s culture serves up competition with a generous side of rewards for increasing knowledge and networking, it becomes a challenge the brain wants to meet. “In a challenge state, your not expected to be perfect, and not expected to win, but you have a fighting chance to rise to the occasion. You’re free to take risks and go for it, which activates the gain-orientation system,” authors Po Bronson and Ashley Merryman write in Top Dog.

Keep Your Colleagues Close and Your Competitors Closer


Though the research staff at Groupon acted as if their cubicle mates sat roughly in Siberia, staff at many companies are geographically dispersed, making it easier to breed negative competition. Think: “I don’t care about beating you if I don’t even know you.” It’s a problem that gamification solved for LiveOps, cloud-based call center with more than 20,000 people on staff.

With staff scattered across many states and in the U.K., Phoenix Marketing International was in a similar situation. To foster communication and collaboration, the company launched an internal social network dubbed PMInsider in 2011. The company’s CEO, Al DeCotiis, tells Fast Company that when the company’s website was being redesigned, he offered employees a link to preview the site on PMInsider, encouraging employee comments, suggestions and opinions prior to the site launch. Though staff were “a bit shy” about posting initially, DeCotiis says there’s been a “huge uptick” in shared information and resources across teams that has led to major efficiencies throughout the organization. Not to mention a 95 percent staff retention rate. DeCotiis attributes this in part to hiring professionals who are a good fit with the company culture “which rewards creative contributions, hard work and total customer commitment.”

How to Talk Your Way to Healthy Competition

As CEO of 15Five, the software that helps companies give and get feedback from staff, David Hassell has thought a lot about how competition can make or break a company’s culture. “It’s not black and white,” Hassell contends, “It’s like stress. There’s good stress and bad stress.”

To tap the good side, Hassell suggests setting up a game where people are competing but one in which the company’s objectives are aligned with the individuals’ goals. “It creates a sense that we’re all in this together,” he underscores. Whether it’s a sales goal that rewards the entire team with bonuses (and extra prizes for the big winners) or a design competition that fosters collaboration among teams that results in a solution actually used by the company, Hassell says “There has to be a broader context where nobody loses, really.”

He believes it is the managers’ responsibility to make sure competition is really transparent from progress to goal. If objectives are aligned when the competition is created it should naturally draw people out. For those staff engaged in solo sports like developers and designers, Hassell says it’s on the manager to reach out and act as coaches. Instead of letting them feel like their “losing,” Hassell says, “Good managers inspire employees to be their best and coach them along the process to discover for themselves to perform better.”


How Does This Make You Feel?

Professor Baard maintains there is an internal psychological need associated with intrinsic motivation. It’s human to need to feel competent and succeed at optimal challenges. “A certain type of competition satisfies this need,” he says, and it’s best to have that competition focused on an outside competitor such as another business, or a common challenge like a deadline or profit goal. “Such a focus supports group collaboration,” says Baard, “This sets up a team approach to victory.”

And that kind of win feels undeniably good.

About the author

Lydia Dishman is a reporter writing about the intersection of tech, leadership, and innovation. She is a regular contributor to Fast Company and has written for CBS Moneywatch, Fortune, The Guardian, Popular Science, and the New York Times, among others.