Competition is a given in life and business. It’s the basic struggle we all face to ensure that you have adequate food, space, time, and other resources to accomplish what you need and want. Competition is a powerful motivator. Who doesn’t love to win, right? And often the stakes are high. We have to win in order to gain customers, employees, and other relationships that are a lifeline to our company.
In a winning frame of mind, it is always a match of rivals. You do you and they do them. One of the two will be crowned the victor while the other gets to sit in the corner with the “L’ on their forehead. But is that healthy?
In the past week, there have been three situations that have me reflecting on how we deal with competition in our businesses.
I watched a valuable, mutually supporting relationship between colleagues go down in flames over the last two weeks. Dan and Daryl work in the same arena but with vastly different roles and companies. Historically, they supported one another as collaborators serving similar customers with complementary services. Their mutual community of potential customers has been growing steadily.
Recently, Dan broadened his relationships and began collaborating with someone that performed similar services as Daryl while still working with Daryl. Daryl did not take kindly to the arrival of another player into the relationship and reacted strongly. Daryl’s view was that, after all the time the two had worked together, Dan’s collaboration and work with another similar party was a significant slap in the face.
Dan was caught off guard by the reaction for two reasons. One was a failure on his part to communicate with Daryl up-front about the upcoming addition of the newbie on the scene and what the business rationale was relative to the relationship with Daryl. (Daryl learned about the newbie via a social media post.) Secondly, Dan did not see it as a win-lose mindset. He believed that there is more than enough opportunity for both Daryl and the newbie to meet the needs of the community. For Dan, it was an “and” opportunity.
Dan, when met with resistance, became defensive. Unfortunately, from there, it got seriously snarky on both parts and the long-term relationship has been irreparably damaged.
Without taking sides, this clash of perspectives brought to mind an article In the January – February 2021 issue of Harvard Business Review on the “Rules of Coopetition.” It makes the case that there are times when it makes complete business sense to actually work with and cooperate with your competition. Reasons for “coopetition” range from sharing the risk of a new venture, streamlining rather than duplicating resources, and accessing capabilities that one party needs and the other party has. Some may believe this concept is naïve and, if entered into blindly without appropriate analysis and risk mitigation, I would agree. But assuming due diligence and balanced guardrails are put in place, it can be magical.
Working with clients in the strategic planning, business improvement and exit planning space, there are many times I encounter collaborative partners that are also competitors to some degree. In a recent client project, I invited a direct competitor to join my project team as that consultant had access to tools and industry expertise that I did not. We have known each other for years and have the basis to create the win-win. Was it risky? Sure it was. It’s possible that they could “steal” the client relationship. (If that were to occur, is that on them or me? Hmmm.) It’s also possible that it will help cement my client relationship.
It’s also interesting to think about coopetition when I’m asked to mentor others entering strategic, exit and family succession planning consulting. Last week, a referral source asked me to talk with someone that’s exploring his next career move and might want to do what I do. I’m not going to lie. My inside voice whined “Why would I want to do that and set up my competition?” Cooler voices countered “coopetition is opportunity. Shut up and talk to the guy.”
I talked with him yesterday and we had a delightful conversation. Indeed, he may end up going to work for a competitor, and I’m ok with that. He’ll do well and be a credit to the kind of support we provide to businesses and business owners. He’s also more likely to recall someone who was willing to help him when he took the risk to ask and, if it makes sense, reach out to collaborate in the future.
In the last instance, a client called to deal with an HR emergency. They had recently hired Pat as their new head of a key department. One of the Pat’s direct reports, Sam, is less than thrilled at the prospect of having a new boss. Sam has important responsibilities in the company, including some that Sam is the sole source of knowledge on. In the heat of a moment, Sam declared that “It’s either Pat or me. You decide.” Pat was willing to fall on the sword, but that is not the right solution. This calls for constructive conversations to better understand Sam’s grievances and see how (and if) Sam can be persuaded to see this new boss as an opportunity rather than a competitive threat. Pat can also learn what approach will be best for helping Sam succeed. Given that Sam is already firmly in the win-lose camp, it is a tall order to turn the dynamics around. It will depend on everyone’s mindset.
The truth is that coopetition is borne out of an abundance mindset. Steven Covey, the author of The Seven Habits of Highly Effective People, spoke in depth about the impact having an abundance mindset versus a scarcity mindset has on you. It is significant. When a person believes that there are enough resources and opportunities to share with everyone it is more likely that those success will come your way. Research shows that an abundance mindset has a positive impact on learning, managing stress, our immune systems, and our success. Similarly, if you travel with a scarcity mindset, the opposite occurs. Rather than seeking win-win, you are entrenched in win-lose which adds pressure, stress, and negativity into the situation.
I think about this watching Dan and Daryl implode and Pat and Sam tussle. Mindset is a secret weapon we use every day. How are you showing up? In this competitive business climate, are you building a better mousetrap through coopetition or roaming the jungle like a lone tiger? Let me know your thoughts!