The Chill of Competition: Why office rivalry is risky

Office Rivalry risks

Remote work isn’t just keeping employees apart, it’s raising the tension bar among them, according to a recent survey by global staffing firm Robert Half.

More than a quarter of the working adults surveyed at the end of July said they felt the level of competition among their co-workers was higher than it was last year. About 61% reported no change and 11% felt a decline in rivalry. The competitive feeling was most pronounced in employees under 40, with over one-third reporting an increase in the rivalry level. 

The results came with a caveat from Robert Half’s senior executive director Paul McDonald: “Fostering a healthy level of competition can increase engagement and motivation among employees — no matter where they’re located. But too much can have the opposite effect, so managers and their staff must do their part to cultivate a collaborative versus cutthroat workplace culture.”

Does ‘healthy’ competition even exist?

But therein lies the unanswered question. There are plenty of stories and comments like McDonald’s that encourage a “healthy” level of competition, but very few insights on what that actually means, and on what can go astray when leaders pit employees against each other, particularly when employees are in a stressful situation to begin with. 

Professor David King, a strategic-management expert and department chair at Florida State University’s College of Business, is well acquainted with the dark side of competitive rivalry. “When the thrill of competition becomes the goal, managers risk the future of their organizational units and potentially careers,” King wrote in Pepperdine’s Graziano Business Review.

“Most people are naturally competitive to some degree, but attempts to artificially increase competitiveness can backfire,” says Scott Young, CultureIQ’s Manging Director, Culture Solutions. “Companies like Microsoft discovered that their system of ranking employees caused their teams to stop helping each other. These firms have abandoned the use of forced distribution performance appraisal systems in the past decade.“

“Promoting office rivalry creates a more political atmosphere
at work that hinders collaboration and it can contribute to
employee burnout. This results in lower productivity
and potentially higher employee turnover.”

Professor David King, FSU College of Business

“Leaders trying to promote competition should proceed with caution,” Young says, “and do so only for jobs where very little collaboration is needed and where there is very little temptation and risk of unethical behavior.”

Enthusiasm may not be real

Leaders who want to inject or encourage competition among teams should ask themselves how they can be so sure they’ll create a thrill – rather than a big chill – in the ranks. Are employees truly motivated by competition or really just fearful they’ll be seen as weak if they bow out of it?  Are rivalries an opportunity for growth or for unfettered bullying? A survey unearthed some fairly dismal answers: Just 3% of workers view competition as wholly positive, and only 6% said it inspired them to do their best work. A much higher percentage – 20% – said that what rivalries actually motivated them to do was quit.

King says healthy competition can exist – but not if it’s turned inward. “Healthy competition is when people working together raise the performance of each other and the focus is on something external,” he told CultureIQ. 

“Promoting office rivalry creates a more political atmosphere at work that hinders collaboration and it can contribute to employee burnout,” King says. “This results in lower productivity and potentially higher employee turnover.”

When rivalry goes remote

A remote-work setting could make rivalries fester and damage company culture, King says. “Lower context interactions (e.g., Zoom, email) are more likely to cause misunderstandings and emotional reactions. Further, being remote offers fewer opportunities to address associated problems, so they likely would grow and contribute to work conflict and stress.”

Young adds that “CultureIQ consistently finds that strong relationships with one’s co-workers are among the top reasons that people choose to stay at a company, and promoting competition runs the risk of hurting those relationships and the collaboration that results from them.” He points out that “decreased collaboration is already among the biggest fears that leaders have about a remote workforce, so now does not seem like the best time to be promoting competition.”

But even when the competition is only directed at outside firms, things can go wrong. A 2019 paper from Professor Gavin Kilduff, of NYU’s Stern School of Business, argues that inter-firm rivalry can cloud strategic decision making.  “Current theory in business strategy is very much based on a rational model of decision-making,” Kilduff says.  “I argue that firms’ and executives’ decisions are also motivated by more ‘hot’ emotional processes based on historical rivalries.” 

Whether directed at a teammate or an outside rival, these ‘hot’ emotions can lead an organization astray. 

The benefits of competition, without the rivalry

Young says one way companies can see the same motivational benefits they may be seeking from competition is by “building and communicating a clear, compelling purpose for the organization, and helping each employee feel a tight connection between their work and that purpose.” 

“Alignment around an inspiring purpose increases engagement while also encouraging behaviors that serve that purpose rather than a more self-serving purpose,” he says.

Young and co-author Cathy Maraist, CultureIQ’s Head of Culture Solutions, describe in detail what purpose is and how it is a core driver of organizational culture in a recent guide to CultureIQ’s Framework. “A compelling purpose lets employees know that they exist as an organization for reasons that are more important than an industry ranking or a shareholder’s dividend check,” they write. “This purpose serves as the north star for the organization and inspires employees to bring their best every day.” 

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