Use Rivalry to Spur Innovation & Competitive Intelligence Sharing

In a recent McKinsey Quarterly, Mark Little, head of General Electric’s Global Research Group described how GE uses rivalry to stimulate innovation. I think these practices help GE be the powerhouse in the many fields where it is a market leader. Rivalry can mean outright competition—a zero-sum contest in which two individuals or teams go head-to-head and one is declared the winner at the expense of the other. But in the case of GE, rivalry is linked to a second notion, called paragon which means comparison. The motivation behind collaboration often is rivalry as two or more teams compete to develop the best product.

Scientists are motivated a lot like anyone else in that they want to be the best: yes, they’re competitive! Due to my love of aviation, my favorite example cited was the GE90, the large, high-thrust engine developed in the 1990s for the Boeing 777, which was developed by two independent teams. While one team won the competition, the other was assigned to challenge and push the winning team. While this pushing process made the teams uncomfortable, it made the GE90 a better engine and helped advance product development.

In the competitive intelligence field, I think of wargaming as a similar exercise where members of each team collaborate and role play as if they were specific competitors, so there is a healthy rivalry among the teams. However, the goal overall in a war game is to help your company be more competitive. More specifically the goal might be to prepare for a competitor’s new product launch, so it isn’t just the competitors who are represented by a team. One team might represent the marketplace which might include customer’s reactions and regulatory hurdles, for example.

Another example where rivalry works is in sales intelligence, when you reward individual sales people for being the best competition detective. Winners might share information around a new competitor entering your company’s space; a significant change in a competitor’s management team; how a team achieved a win back against a key competitor; new innovation in the marketplace; or how to win sales in spite of regulatory constraints. This is fun since most sales people like publicity and you can lay it on thick through your company’s communication channels: sales rallies, sales teleconference calls, complimentary write ups in the company wiki/newsletter or intranet and a handwritten letter to the sales person’s boss and others like the VP of Sales! While your reward system will never compete with a sales person’s commission, this publicity can. This playful rivalry will only grow over time if you figure out different ways to let Sales compete and continue to publicize your thank-you to the best competition detectives.

The real learning is you can use healthy rivalry to stimulate various behaviors since most people are naturally competitive and want to be the best. You need to figure out how best to motivate individuals to reach your company’s goals whether it’s product innovation, competitive intelligence or sales intelligence, the examples cited here. Depending on an individual’s personality type, this healthy rivalry might be fun or it might make them squirm a bit.

In the spirit of cooperative intelligence, here is an article on sales intelligence for your reading pleasure.

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2 Responses

  1. I know what you’re saying, but I just can’t agree.

    Do most people naturally “want to be the best,” or do they just want to be recognized and rewarded for their achievements, especially those that draw attention to their unique contributions? I don’t think it’s the same thing. Wanting to be the best implies a hierarchy, but wanting to be recognized for unique contributions doesn’t necessarily mean hierarchy; it may just mean wanting to be seen for who you are.

    I am not a competitive person at all. Competition doesn’t make me squirm. It flat out annoys me. It distracts me from pursuing the goal, like flies buzzing around my face that I need to keep brushing away. I know where my strengths lie, and when people want to compete with me in these areas, I’ll probably “win” anyway, so why should I bother to compete? I just focus on what I’m doing and ignore them (or invite them to help if they are willing). If it’s in an area that is not my strength, I’d rather work with the “competition” so that I can learn from and build on what they know. If we all come out with a better product that way, does it make my product any less good? No! Is there less of a quality gap between competitive products? Maybe (more likely, there are different options based on what is important to the inventor). Does that mean I still can’t sell it and be profitable? Of course not, it just may require a bit more creativity on my part.

    I’ve played all of these competitive games and I just don’t buy the justification that they help drive to better product.

    The most productive, innovative, energetic, and successful project teams of which I’ve ever been a member did not compete at all. We just were really passionate about our goal and knew we could create something great together (and did). Competition tethers you to a benchmark set by the competition and may lead to – or even drive – incremental improvement. Rising above competition opens a world of possibilities – innovation. There’s no better way to “win” than to have the ONLY product of its type, not just the one with the better performance. You don’t have much chance of innovating if you are focused on the competition (or even friendly rivalry) instead of starting with a fresh palette.

    I suppose it all depends on your business goals and the nature of your design team.

  2. Wow you have strong opinions about not liking competition for innovation. I think it really depends on the individuals, the industry and the company’s culture.

    I kind of like competition, but then again my background is sales and marketing where competition makes us better. I started life selling for the Bell system which had no competition. It’s amazing what happened to product development when there was competition, although it was from other companies, not from within like at GE.

    Would love to talk with you about this after this long Memorial Day weekend if you have time.

    Let me know naylorellen at gmail dot com.

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