You can't have winners without losers.

It's easy to create an organization driven by rewards and punishments. People respond to short-term consequences. We're naturally dispositioned to compare ourselves to those around us and want to achieve more. It's easy to build off this bias.

Yet you can't create winners without also creating losers. You can't develop an in-group without also leaving people outside of it.

When you measure success by comparing some in your organization to others, it creates a zero-sum game. There's only so much of the pie to go around. If one person gets a bigger slice, it means someone else is going to get less.

A certain amount of good-natured competition can be healthy, even necessary to encourage continued growth. But when individual agendas begin to take priority over the company's purpose, it starts inhibiting the behaviors you're trying to encourage. Great organizations encourage people to have differing objectives, but always with interdependent goals. If only one agenda can win, then the collective group is going to lose.

I once interviewed with a company that ranked every employee based on their perceived value to the organization. The interviewing manager bragged to me about how it motivated their top performers. He didn't seem to realize the debilitating impact it had on the other 80%. Fast forward ten years, they're out of business, unable to mobilize the company to work together and adapt in a changing world.

People are smart. They're very good at modifying their behaviors to reflect what management measures and rewards. If companies measure activity, people will find ways to stay active, regardless of whether they're producing value. And if companies prioritize individual success over the collective benefit, people will adapt to succeed within that system as well.

In today's rapidly changing world, our success is tied to our ability to innovate across silos. Great products and services are no longer the brainchild of a lone genius, they're developed and perfected through collaboration. Building and marketing great products and services takes a team of dedicated and motivated people across each functional role.

It's easy to promote internal competition and select out a key group of winners. You just need to recognize the consequences that come with this scarcity model.

Of course, the alternative is to lead through an inclusive, collaborative culture where everyone works towards a common purpose. There's no reason we can't give everyone challenging work, the opportunity to make a difference, and encourage them to continue to build upon their best efforts. In this model, everyone wins.

We don't intentionally hire losers. We shouldn't go out of our way to create them.

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