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The Fast Company Executive Board is a private, fee-based network of influential leaders, experts, executives, and entrepreneurs who share their insights with our audience.

Why encouraging employee competition is a losing game

Never underestimate the value of fostering a climate of cooperation and positive teamwork. 

Why encouraging employee competition is a losing game
[djile / Adobe Stock]

Early in my career, I stepped into a chief marketing officer (CMO) role in which I made the mistake of encouraging unhealthy team competition. I initiated a contest to see which of my teams could bring in the most leads over the quarter. However, I quickly realized that by setting up this challenge, I was rewarding the wrong behavior.

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THE PRICE OF FOSTERING FAKE COMPETITION

Competition is pervasive in the modern business landscape, but I find it’s often used the wrong way. By inciting a spirit of unhealthy competition among my teams, I was actually wasting the team’s resources.

Anyone in sales and marketing will tell you that it’s the quality—not the quantity—of leads that count. Because each team wanted to win, they stopped sharing; they hid information about customers from one another and they pursued leads with little chance of conversion. This resulted in disjointed, ineffective outreach efforts that provided little-to-no value for the team.

As I learned the hard way, once you’ve established fake competition in the workplace, it’s difficult to reset the tone of the workplace to encourage people to change their behavior and work together.

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The bottom line? Never underestimate the value of fostering a climate of cooperation and positive teamwork.

MAKE WORK A TEAM SPORT

Think of team sports like football or baseball. No single player can win the game. It’s up to the collective team to play to their unique strengths to beat the competition. While the coach selects individual players and assigns them positions on the field based on their unique strengths, no single player can win a game.

The way I see it, a business’s best asset is how well its team members collaborate. Each person has their own skills and experiences, but when individuals apply themselves solely in pursuit of self-seeking goals, the entire business suffers.

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Leaders should always work toward establishing and sustaining healthy competition in their workplaces. By this, I mean encouraging and rewarding people for working to beat their real competition—their competitors in the market—and not one another.

Acknowledge and celebrate people and teams who lift each other up. It’s also important that cooperation and teamwork are explicitly written into people’s key performance indicators (KPIs), and that team success is a determiner of the year-end bonuses and pay increases that individuals receive.

THE RIVAL WITHIN

Our innate competitive instincts can also serve us well when we use them to push ourselves to become better—effectively competing against ourselves.

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One way to encourage this type of competition is by setting clear individual KPIs and stretch goals. Your team’s goals need to be co-created with employees, so they can find their passions and participate meaningfully in their personal growth.

If people are evaluated solely on the performance of the team to which they belong, you run the risk of “slacker syndrome.” Here, some individuals may simply get too comfortable being part of the herd that they stop pulling their weight.

GETTING BACK TO WHAT MATTERS MOST

So how did I fix my own mistake and resolve the competitive environment in my own team? I had to shift what my team thought was most important.

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Creating a competition, I had set the expectation that winning was important. That was a mistake. Instead, I sat down with my team and helped them realize that what was actually important was winning together. Collaborating as a team and organization to beat our real competition.

It’s never too late to reverse the effects of employee competition. As leaders, we have the opportunity to have real conversations with our teams to break down competitive barriers and change our behavior for the better.


Efrat is CMO at Quantum Metric, with extensive experience in tech leadership and customer-centric organization strategies.

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