Competition as a Motivation Technique – Good or Bad?

Nomination of a best sales person, peer reviews and bonuses based on results. There are many more or less motivating ways to increase the competition between employees. Many of us have even participated in them. In this blog we will discuss why the competitive situation can be a good motivation tool, in which situations it does not work, and how competition between employees should be properly implemented.

Competition as a motivation tool sparks opinions for and against

We know that the competitive situation activates the mind and body to work harder and to achieve better results. It is not surprising that many studies show that the competitive situation also motivates workers, encourages efficiency and helps companies achieve their goals. [1]

If a company succeeds in creating positive competition in a work environment, many things can change in the right direction:

  • Many people are naturally competitive and instinctively achieve better results in a competitive environment
  • Competition can reduce indifference, so it directly affects the attitudes and inspiration
  • Competition can be an incentive to find innovations that would otherwise not be found
  • Many people find that the competition creates a fun and positive environment that engages and gives employees something to look forward to
  • The competitive situation can inspire you to take responsibility[2]

Have you considered competition as a motivation technique? A well-organized competitive situation improves cooperation and is a great motivating factor

The potential benefits are therefore diverse, but arguments can also be found against creating a competitive environment. If the competitive situation is poorly managed, the employee may feel that the situation is frustrating, threatening, stressful, or tiring. In addition, co-operation between employees may also be negatively affected. If competition becomes more important, the broader goals of the organization may disappear or the morale may deteriorate if employees begin to look for dubious ways to do better. [3][4] All these counter-arguments should be taken seriously. However, these are things that can be affected by how the competitive situation is created and can be prevented by careful planning.

How to implement competition between employees correctly?

By motivating employees to compete with each other, success depends largely on corporate culture. If, in principle, the company has an enthusiastic and positive way of doing things and a culture of cooperation, creating a positive competition can be a very good solution for creating additional interest. If the initial situation is inflamed, creating a competitive environment can increase anxiety.

The article in HBR discusses various ways to influence whether a competition is an issue of enthusiasm or anxiety. The company can in principle redesign work management and incentive methods, but there are also means that do not require the same amount of upheavals:

  • The company should focus on positive results, that is, what can we win by competing and not highlight what can be lost. Possible negative consequences cause fear and anxiety in employees and promotes bad moral choices.
  • Communicating about the contest is very important. The leader should create positive enthusiasm and bring more attention to success than failures.
  • Instead of compelling employees to compete in the same things, they can be asked to bring out the things they are good at.
  • The competition can be judged based on, for example, innovativeness. This encourages you to compete with yourself and not so much against other people[5]

In addition to these, we would like to emphasize that having individuals compete against each other is not an only option. It is possible to organize competitive situations so that competition happens in teams and people get points from cooperation –not competing individually. Negative aspects of competition can be prevented in particular by digital tools. They allow managers to observe measurements,  guide employees to focus on business matters and provide constructive feedback.

If motivating employees as a subject interests you, you should also read our blog ”Improving Collaboration in Organizations”. It examines what incentives can be used if financial incentives cannot be provided or they are not compatible with the organization’s culture.


[1] Steinhage, A., Cable, D. & Wardley, D. (2017) The Pros and Cons of Competition Among Employees.

[2] Miller, B. (2014) Does Competition Among Employees Work as a Motivator?

[3] Miller, B. (2014) Does Competition Among Employees Work as a Motivator?

[4] Steinhage, A., Cable, D. & Wardley, D. (2017) The Pros and Cons of Competition Among Employees.

[5] Steinhage, A., Cable, D. & Wardley, D. (2017) The Pros and Cons of Competition Among Employees.


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