Experience Stern | Faculty & Research

Competition between co-workers has long been a driving force within organizations: some companies offer bonuses or commissions based on relative performance, while others promote and terminate  employees based on direct comparisons to their peers. These types of scenarios indicate that many organizations view competition as a means of inducing motivation amongst employees. But at what point does promoting competition become more harmful than helpful? NYU Stern Professor Gavin Kilduff, along with co-authors Blythe L. Rosikiewicz and Christopher To, investigates this question in a new paper.

In the paper, titled, “When Interpersonal Competition Helps and When It Harms: An Integration via Challenge and Threat,” the co-authors reviewed existing empirical research on the consequences of competition between individuals and focused on which factors determine whether the outcomes are beneficial or detrimental.

Key takeaways include: 

• When viewed as a challenge (i.e., demands of a situation can be overcome), competition leads to positive outcomes 
• Conversely, when viewed as a threat (i.e., demands of a situation cannot be overcome), competition can lead to negative outcomes
• Managers and organizations can control the factors of competition in order to keep it healthy and non-threatening. Examples include:
  • Avoid tying punishments to losing
  • Only set up competition between evenly-matched individuals
  • Eliminate opportunities for sabotage
  • Provide support to less-experienced and less-skilled employees so as to increase their perceived abilities to compete

“Interestingly, many of the factors that help foster challenge appraisals of competition—such as social support provided by peers and managers, reduced existence and salience of negative outcomes associated with losing, and an atmosphere that fosters greater self-efficacy in employees—may be less common in the workplaces that most often use competition,” write the co-authors. “So, there may be an opportunity to foster more productive workplaces by combining elements characteristic of more ‘cooperative’ workplaces with carefully managed interpersonal competition, thus eliciting challenge states in employees.”

The paper is published in the Academy of Management.