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Syd Weighs In

Harness your competitive drive

About the author

Sydney is a professor of strategy and leadership, and Dean for Executive Education,  at the Tuck School of Business at Dartmouth and the author of 16 books, including Why Smart Executives Fail. Follow him on twitter: @sydfinkelstein

Competition is fierce--even among teammates--in Sochi.  (Martin Rose/Getty Images)

Competition is fierce--even among teammates--in Sochi. (Martin Rose/Getty Images)

A new barista at my local coffee shop pulled a wonderful ristretto cappuccino the other day. When I told her it was almost as good as the one the more experienced baristas make, she seemed a little disappointed. The next day it was even better, which I noted. The new barista’s reaction: it’ll be perfect next time!

People are driven by competition in every walk of life, from babies to the elderly, from Canada to Australia and from my local café to Wall Street. Yes, the intensity varies from person-to-person, in part based on the domains in which they exercise their competitive muscle, but the competitive spirit is central to who we are as human beings.

As the 2014 Winter Olympics in Sochi, Russia are upon us, let’s take a look at competition. What does it mean for strategic thinking and motivating talent in organisations, and for each of us? 

Scheming colleague

Do you know anyone who looks at the world as “us versus them”? I do. This person is always scheming to get ahead. He doesn’t just want to win; he wants the other guy to lose. You almost have to check your wallet when you leave his office.

For some people, that is the definition of competition, and it’s not hard to see why. Take ice hockey, popular at the winter Olympics. One team wins and one team loses. Your team cannot win unless the other team loses.

When this attitude moves from the ice to the office, you get… Larry Ellison. The famous chief executive officer of global computer technology company Oracle is well-known for his axiom, “It’s not enough to succeed; everyone else must fail.”

What happens, though, when you start taking more joy in someone else’s loss, than in your win?  Sound crazy? I wonder if this logic is behind hyper-aggressive cost cutting in retail. In truth, when prices fall, everyone loses because profits are squeezed and consumers begin to expect the lower prices. Nevertheless, retailers still cling to the practice in hopes that eventually they alone will survive and then they can push prices up. Isn’t this what the stock market has been betting on when it comes to Amazon? The company books losses or marginal profits year after year, and yet the company’s stock price inexorably  moves up.

Joy in others’ losses

This also brings to mind the famous “loss aversion” hypothesis of Nobel Prize winning psychologist Daniel Kahneman and Amos Tversky. Through a variety of experiments they demonstrated that most people hate to lose more than they like to win. As a result, we don’t sell losing stock investments when we should (“it could always go up” we tell ourselves), we don’t give up on failing pet projects as quickly as we might (Microsoft’s Bing search engine?) and we are less likely to return clothes we order online (presumably because once it arrives in your home, sending it back means giving something up: a loss).

Worth remembering, however, is that the act of competing very often does make us better. College basketball teams tend to do better in a tournament when they play more difficult teams beforehand. It toughens you up. Industries like consulting and banking have their own version of this: they’ve created an up-or-out system that requires you to perform well relative to the other people around you.

Many jobs raise the bar even further. Not only must you compete with colleagues to get ahead, but you have to also cooperate with them. Sounds like a paradox, but consider the consulting industry. People work in teams —meaning cooperation is required — to accomplish tasks, yet it is not the team that gets promoted, but the individual.

My favourite example of this phenomenon is in ensemble variety shows, such as the comedy stalwart Saturday Night Live (SNL) in the United States. To get a spot on the weekly show, writers and actors must create skits together. That’s cooperation. But there are more skits than time available. That’s competition. The best people must learn to simultaneously cooperate and compete with colleagues. The net-net of this is that SNL has become a launching pad for talent in the comedy business. 

The secret to competitive success?

Now, what of our new barista at the local café? When we talked some more about making espresso (yes, I like coffee a lot), it became clear that her desire to get better was driven less by trying to one-up the established baristas, and more by her internal need to excel. She was testing herself, found herself falling short and had vowed to improve.

Of all the flavours of competition, this is the most powerful one of all. Competition that is self-contained, where you’re driven to work, to accomplish and to exceed what you’ve done before, simply because you want to. Your internal motivation and commitment are much more powerful than external competition.

The 18-year-old American Olympic skiing sensation Mikaela Shiffrin has been described as a “once in a lifetime talent” by her Austrian-born coach, winning six World Cup slalom races in the last year while competing in a sport where most women peak at age 27. When interviewed, she asserts, improbably, that it is not simply winning a race that motivates her. Instead, she says, “I can honestly say that I am motivated by improvement, not results.”

None of us might have the incredible talent of Shiffrin, but we can all absorb this lesson. When you are internally motivated to always get better, you end up winning a lot more than you lose.

For more by Sydney Finkelstein on what baristas, hockey players and comedy shows can teach us about competition, listen to this iTunes broadcast.

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Most people hate to lose more than they like to win.