As a continuation on the “Being the Best” post from a few days ago, I’d like to look briefly at internal competition.  Internal competition is healthy to a certain extent as it can bring out the best in people who like competition or that want to perform given their surroundings, but it’s important to remember that the people within an organization are all talented in their own ways, and so comparing people in similar functions or roles will eventually have negative effects.  Like in sports, there is a fulcrum point for internal competition where there are diminishing returns or even negative returns if the situation is such that it spoils the environment for natural production.

People aren’t made to be force ranked against one another and to do so is to dilute their work.  They all have value to bring, quite often in very different areas.  Some have more value to bring organizations than others due to their skills being more applicable, scalable or simply less so available in the organization or market.  Here are a few quick points to keep in mind:

1.  You are competing against yourself and your ceiling of self actualization, not others in similar positions.

It’s a very natural occurrence for people to measure themselves against peers as they are readily available as a metric.  Doing so can have some positive effects where your peers are “outperforming” you and it propels your performance, but this logic only goes so far.  To measure yourself solely against peers misses out on a much less visible area of value where others aren’t tapping into.  I believe there are a few types of value persons can offer organizations, one is in execution and another is in creation.  A brief example would be someone who “executes” against deadlines by writing reports that absolutely have to be done by a certain time.  The other would be “creating” a new revenue stream by investigating a new market and developing a plan to sell toward it.  Both of these things are absolutely valuable, but one is much more common than the other.  The ability to think critically in areas the business can grow or improve efficiency is not common; if you find people who do so hold on to them.

You should be asking yourself what you are truly capable of and how it can impact the organization, not simply watching what others do and trying to top them.  You have different value ceilings (your’s may well be higher than theirs in multiple areas) and your job is to maximize YOUR talent, not theirs.  Maximizing others’ talents is something I’ll address in the future.

2.  Companies don’t have a limited need for talent.  It’s not a zero sum game for who can do well.  Treating it as such will lose the company very good people.

Principal Agent Dilemma

Principal Agent Dilemma

There is a tendency within organizations to view the prospects for growth as limited and finite.  To an extent, this is true, especially given time constraints.  After all, there can only be one CEO.  Due to this, the actors seeking promotion and higher titles will compete to win the spoils.  Internal competition such as this can have positive and negative effects.   Some negatives include the actors not cooperating with others due to a view point that helping others will not benefit them.

If Sue and Matt have similar roles and both want to be promoted, should Sue help Matt learn some of the new information she picked up at the customer off site?  For the good of the company, of course!  Yet in Sue’s mind, she may take the perspective that if she wants to be promoted, it can only hinder her chances to help others in similar roles.  By assisting them, she is naturally decreasing her likelihood of promotion due to a limited number of promotion roles.  This is a subset of the agency theory.  There may be some validity to these ideas as sometimes well deserving people aren’t promoted and people that do a poor job as a team player are.  The world is not ideal, after all.  Still, in my opinion, without a doubt Sue should be helping Matt…as well as everyone else she can.  The ultimate value people can offer companies is to lead and provide direction strategically.  Actors who do not embrace the role of teacher in lesser roles and help others cannot succeed in the long term as a leader, especially with intelligent people beneath them.  They will sniff out the self serving rationale and performance will naturally decrease.  The team will become average, or worse.

3.  Promoting a company where everyone is valued and wants to work together and see success with all is the ultimate goal.

Companies that value collaboration and working together will outperform those companies with similar talent levels in internally competitive situations. The reason is simple, they will benefit from making one another stronger and smarter, faster.  Internally competitive companies will suffer much higher churn of employees as well.  There is much less loyalty in a company where people are set against one another to “win.”  After all, with every winner there are far more “losers.”

Again, there is some value to internal competition.  It’s not all a bad thing.  Like in sports teams, pushing one another to do your best is a valuable asset, but when the mindset shifts from a team value to that of “every person for themselves” there is a very real danger of underperforming and even negative environments.