Competition in the corporate world is not always good and isn't even the reason for superior performance.
Better performance comes from better collaboration which is sometimes inspired by the challenge of competition.
In many contexts competition is actually divisive as it directly hinders better collaboration between staff, customers and suppliers.
Growing up in the '80s my introduction to capitalism was very much of the red-braces, huge mobile phones and Porsche 911 variety. Competition was good, and the more competition there was, the better it was for everyone, right?
Recently I have been pondering "if competition is so good, why exactly is it so good?"
What is it about competition that delivers the superior performance economically that means I can speak to my friend 12,000 miles away, with live video, for free? Then I get to travel to see her for less than a week's wages for the average person. Truly capitalism and consumer economics are miraculous.
The mistake here is to consider capitalism and competition as synonymous. If anything, capitalism tends towards monopolies; hence regulation, which exists to maintain competition. Which is always good, right?
Is competition always good?
In order to answer this question let's examine when competition is not so good.
Let's look at somewhere close to home -- within already successful companies, perhaps one you know intimately, perhaps one you own or manage?
Do people or departments in your organizations have targets? Am I right in thinking they have individual or departmental targets rather than company level targets? This creates competition, right?
Winning the Game
A friend of mine used to manage a coal mine and he would tell amazing stories of such cunning and ingenuity that Blackadder himself would have blushed. Each of these impressive tales followed the same theme: teams of tough coal miners engaged in daring raids and sabotage missions.
The aim of these missions was primarily to liberate coal from another team's pile of coal that represented that days mining production, making the attacking team appear much more productive and ensuring their team targets were markedly easier to achieve.
The level of ingenuity and creativity required would make any man proud to be British. For the owners of the coal mine however all of this skill and effort was completely unproductive, no matter how entertaining it was for the guys in question.
It's important to note that very little blame can be laid at the coal miners doors. They were just doing what human beings do exceptionally well, exploiting the rules of the game to win. Very few managers ask themselves, "How do you win the game here?"
Competition provides challenge, which is a great stimulus for action; however the context of who you are competing against is vitally important.
Don't compete; collaborate!
Only when the challenge of competition with another 'outside' group or individual causes a group to collaborate more effectively does competition lead to superior results. It is this greater collaboration that produces the superior performance. Not the competition in of itself.
To what extent do the departments, suppliers and customers of your organization collaborate?
Are you 'forced' to compete, or do you force your subordinates to compete, by the way the system has been set up?
If you're in charge of the measures that cause this competitive situation to occur I would urge you to consider this: It is the entire supply chain that is truly in competition, not individuals, departments or even companies.
Any other form of competition is typically manufactured by well meaning managers, unaware of the full cause and effect and the destructive consequences of the game they have set up.
It is always through collaboration that man's greatest achievements are attained; I cannot think of a single individual who has achieved significant success alone.
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