Creating a Competitive Workplace: An Effective or Damaging Tool

Today’s business world is highly competitive. Hence to sustain effectiveness, it can be argued that an organisation must itself be correspondingly competitive. In response to this abstraction, a leader may choose to reflect, internally, the external environment – to deliberately create rivalry within the workplace, encouraging self-minded, ambitious thinking and behaviours. Such a strategy builds on the premise that enhancing individuals’ and teams’ innate desire to out-perform others, logically forms a more successful enterprise.

However, a simple cross-check of the word ‘competitive’ in a Thesaurus should set alarm bells ringing: aggressive, cut-throat. Applying such traits outwardly, in tackling companies that pose a threat, may well yield good results, but applying them inwardly could develop a culture that disheartens more of the workforce than it motivates.

Competition as a motivator

Some people are naturally competitive. The stronger this element in a personality, the more surpassing opponents – outdoing peers – becomes the biggest stimulant. Noticeable symbols of success are craved – status, salary, power – rather than the inner satisfactions of achievement and a job well done. Thus for the naturally competitive employee, receiving tangible rewards is all important.

Others, though demonstrating little or no personal will to beat co-workers, can become extremely inspired on behalf of the team in which they work. Such individuals may well view self-focused aims as dishonourable, while praising team-orientated challenges as acceptable – in fact admirable. Personal incentives, for these workers, are neither fitting nor effective. The collective feeling of fulfilment from group accomplishments is usually all that is required as an ongoing driver.

But inevitably a certain volume of any workforce is de-motivated by excessive use of comparators, particularly at a one-to-one level. The balance of those turned-off or turned-on by competition varies from one organisation to another, dependent on the nature of a business, its culture and its reward system. A wise leader considers these factors, and plans with care, before seeking to influence the level of competitiveness in the workplace.

Effects of competitiveness

It is certainly true that high achievers are more often those driven strongly by a competitive spirit. Correctly focused, this type of employee can be a major asset. Highly productive, hard working, determined – these individuals ‘cut to the chase’, directing energies only on what matters, not distracted by the ‘noise’ underpinning any work environment. At its best, a peppering of competitive workers can create an upwards spiral to increased productivity and process improvement, infecting the whole workforce. But at its worst, even a small handful of very ambitious characters can have a toxic effect on the overall workforce and hence on an organisation’s performance. This negative influence is the consequence of a number of factors.

The first is the culture generated by single-minded behaviours. Whilst the competitive person wants to enthuse subordinates, for the purpose of furthering his own cause, too often he pushes others too hard. The workplace becomes increasingly aggressive and unsupportive, to the point of bullying – for many the result is an unpleasant place to work. The go-getting individual may well feel “I don’t come to work to add people to my Christmas card list” but this sentiment isn’t shared by a majority of most workforces, who actually think quite the reverse.

Furthermore, workers are often quite astute in establishing that they are being exploited for the benefit of one, or a small group of, self-interested colleagues, such is the transparency of ambition. Few members of staff will accept this. Unless they feel firmly in the slipstream of the upward progress of the high achiever, with an opportunity to gain advantage themselves, the over-worked employees may well become discouraged, with a resultant reduction in output.

Those driven by self-regarding competitiveness can exhibit inappropriate behaviours. Like the salesman who soldiers on alone, hiding an opportunity from those who could help clinch the deal, determined not to lose any of the credit for a sale to his colleagues. Only when the deal is lost does the salesman recognise that even a joint sale was better than none. Knowledge may be withheld, rather than shared. Frequently collaboration is the first worthy attribute to be shed, when personal objectives take a hold.

While aspirations and determination, correctly harnessed, are a significant advantage to a business, if misdirected they can be very destructive. The competitively stimulated individual operates in their own best interests, irrespective of employer. Burning out colleagues, partners and even customers makes perfect sense to the executive whose prime pursuit is promotion, an increased bonus or a launch pad into another enterprise – but these exploits are bad news for everyone else involved.

So any leader is faced with a difficult dilemma. A competitive workplace has the potential to take an organisation to new heights but, inappropriately handled, the detrimental effect of competitive behaviours can, very quickly, pollute and demoralise a workforce, to such an extent that a business’ prosperity suffers.

Public sector parallels

While it is tempting to believe that rivalry and self-mindedness are attributes of only the private sector, these same traits have become significantly more apparent across the public sector in recent years, particularly within senior management tiers. Endeavours to improve the efficiency and effectiveness of government-funded establishments – in order to reduce costs and create savings – have purposely tried to shift cultures and working practices towards more commercial models. Inevitably, this transition has seeded competitive thinking into previously cooperative environments, with mixed consequences.

Even in non-profit making organisations, top level executives nowadays expect good bonuses, coupled with promotions, for meeting targets – like the Hospital Director who increases the throughput of operating theatres, the Head Teacher who raises pupils’ qualification achievements or the University Chancellor who doubles the value of research grants. At the opposite end of the spectrum, innocent looking schemes such as ‘employee (or team) of the month’ – designed to create greater motivation – are based on the same principles of out-performing associates. In all cases, award schemes are put in place to encourage workers to compete against each other.

The growing demand for performance measurement and monitoring at corporate, divisional, team and individual levels – with the intention of attaining and providing evidence of improvement – has heightened the competitive spirit of everyone involved. The implementation of an efficiency agenda, laudable though its aims may be with regard to cutting government funding, relies heavily on generating more commercial workplace environments.

So how long before some employees resort to inappropriate conduct, to facilitate reaching targets? A Contact Centre operator may close down a call, knowing that unresolved issues remain, to achieve designated hourly call rates. A care worker possibly skimps on house cleaning activities, so that more visits can be fitted into a day. The health inspector overlooks a potential risk, to avoid taking up precious time reporting a concern, when statistics require a specified number of inspections per week.

While challenging performance measures may appear to offer an excellent tool for tackling efficiencies in public services, an over emphasis on measurement and figures can de-motivate and produce unhelpful behaviours. Workers can see that their raison d’être is being devalued and undermined.

Ensuring the good effects

The good, rather than the harmful, effects of competitiveness are best ensured through careful alignment of corporate and team aims, right down to individual objectives, coupled closely to a reward system. Thus fulfilment of personal aspirations is only achievable through addressing business goals.

Establishing a good performance management system should be ‘bread and butter’ to any well led organisation, but its importance is much magnified when a leader wants to gain the benefits of a more competitive workforce, with minimal problems. The drive created is a powerful, single-minded energy, which must be channelled in the right direction. A hierarchy of SMART objectives – Specific, Measurable, Achievable, Relevant and Time-dependent – provides a leader with the harness required.

Most establishments claim to operate with cascaded SMART objectives for measuring performance. In reality it could be reasonably argued that too many don’t. The clarity of bonus targets at senior levels is rarely reflected down an organisation’s hierarchy but, if a firm is seeking to perform well in a demanding marketplace, the realities need to be clear across the whole breadth of the workforce.

And having set SMART objectives, which truly echo the dynamics of a business, an associated reward system has to operate fairly, using these. To be effective, incentives must be increases in whatever individuals perceive as valuable: pay, bonuses, promotions, power, influence, opportunities. For competitive people, rewards need be very visible and appreciated as symbols of success.

An added benefit of cascaded goals is that teams and the employees within them are all working for the same outcomes. Thus team players, who dislike personal ambition, may well embrace the competitive worker when everyone is striving for the same common cause. And any resultant cross-fertilisation between parties – of attitudes and ‘feel good’ factors – provides further overall gain.

Playing the competitive card

Simply establishing and managing through a well structured performance management system, linked tightly to an incentive scheme, will in itself create competition. The rewards available must be seen to be limited, so that only those who out-perform their peers can benefit.

The greater the visibility of individual and team achievements against targets, on an ongoing basis, the greater the impact on performance. It only takes a small minority to be showing outstanding results and colleagues, who want their own slice of the cake, will endeavour to match the highest published accomplishments – and more.

Importantly the only route to rewards must be closely aligned to successful attainment of objectives; any side-tracks – such as awards gained through personal favours to high-placed leaders – will not only adversely steer individuals, but will rapidly influence many more in the workforce to similarly divert from the corporate direction. In the same way, only good competitive behaviours should be the path to advantage – that is those behaviours that benefit an organisation as a whole; misplaced competitiveness, which benefits only one person, or exploits others, has to be visibly denounced.

Generating rivalry through a deliberate policy of hiring naturally ambitious people can be a useful tactic, but should not be overdone. New hires have to be well distributed. Their purpose is to re-energise the existing workforce, not to form into clusters where they challenge only each other.

A less noble, though very effective, means of creating competition in the workforce involves blurring roles and responsibilities. Some characters will start to feel threatened that they could lose part of their power or ’empire’, while others see an opportunity to enhance their own. Inevitably all parties will strive to increase performance, thus demonstrating a greater right to whatever is seen as ‘up for grabs’. Similarly, artificially splitting logically integrated teams into separate entities, with unclear and intersecting spheres of activity, also has the potential to stimulate positive competition. Each team will strain to out-perform the other, in order to gain control of the shared domain.

Balancing benefits and risks

Establishing a competitive workplace is potentially a very powerful tactic for increasing an organisation’s ability to address a demanding marketplace, efficiently and effectively. Competition is a very strong motivator for many successful people, who have the ability to raise a business’ performance to new heights. But an overly competitive environment can dishearten many reliable members of staff, generate unhelpful aggressive behaviours and – if misaligned with corporate goals – be very damaging.

Even with all the right safeguards in place, leaders must carefully balance benefits and risks, before adopting a strategy of ‘creating a more competitive workplace’. The price paid, in losing the goodwill of many in the workforce, may prove too high.