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Will performance-based competition increase or decrease employee production?
I am thinking about starting a competition with-in my company to spark employee production, but I've read mixed reviews on performance-based competition. What types of things should I consider before running a company competition? If we see good progress, it might become a permanent staple in the company.
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5 Answers
As long as the competition is fair and 'winners' are selected and rewarded fairly, it will work.
I work in an industry that (at least partly) works with clearly defined deliverables - and in this case performance based competitions do work,
Where the evaluation is subjective, it tends not to work, as you tend to have someone or the other who will come up and say that she /he was unfairly evalauated...
It should work . please have the expectaion set accurately and also the deliverables also done cleary to have a healthy completion and make it a constant drive to run it
The first two posts have it right on the deliverables aspect; employees need to know specifically what they are being judged against for a competition to succeed. Subjective measurements like the "hardest worker" or the "most effort" create an inherent bias. The fallout of a subjectively judged contest are rumblings of a rigged or unfair competition by your employees and ultimately serves as a de-motivator.
I recommend using a system based on several variables, not just the final product (revenue generated, number of widgets sold, etc.). Incorporating number of calls, customer reviews or some other comapny specific metric will garner more support for a competition, especially for the reps who know they are not the top producer. Using weighted averages for these measures is also recommended.
I have also successfully used team competitions to spark interest and production. Going after a goal with a few people by your side promotes camaraderie, increases effort and generally enhances competition.
Idea of a competition bringing the best out of people always sounds logical, so I'll play devil's advocate here and suggest against it.
I have had relatively negative experiences with in-house competition and would not recommend it as it has taken me 1,5 years to clear the mess I made and fix human relations between the groups.
How it eventually turned out was that despite the impression how two groups are doing the same job in the same environment, they were both actually in a very different situation and somehow it came to a point where it felt like we were comparing apples to oranges. As a negative side-effect, teams didn't use chances to collaborate and gain overall production gains, but were trying to edge the other team. Also teamwork between workers was.... suspect at best.
There is an old adage: "If you can't measure it, you can't manage it." Performance-based competition should be accurately and objectively measured with rewards that are meaningful to those people who excel. Many plans fail because they aren't carefully considered, utilizing objectives that do not correspond appropriately with the desired results. While there are a number of rewards that can be used, their achievement should be important to the person getting the reward. For example, a designated parking space in an empty parking lot doesn't provide much incentive while a $50.00 gift certificate at the local Chili's could be a real driver of performance for a minimum wage employee. Too many owners try to motivate their employees with rewards that are important to the boss, but have little relevance to the employees.
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