A sponsor puts a real prize, such as new headcount, up for open competition between rival factions, so their effort goes into winning it and less is left for opposing other plans.
Borderline: whether this move is justified depends on the situation, and only the person in it can judge.
An example
Enterprise sales growth and an outside contract for network field service were the two goals a telecom carrier's chief strategy officer set for the fall, and both sales regions disliked the second. The strategy office announced a contest: fourteen new account managers would go to whichever region produced the stronger enterprise growth plan by November, judged by the chief executive and finance against published criteria. Both regions spent October on their plans, and both plans were better than anything they had submitted in years. The outsourcing agreement went through the steering committee on its normal schedule, with the full contract in the pre-read. It drew two questions and passed. The eastern region won the account managers, and the western region's plan was funded at half size the following spring.
Why it works
A real contest makes the prize the thing worth fighting for, so opposing the sponsor's other plans looks worse by comparison: a diffuse, shared benefit against a concrete one only your faction can win. Coordinating against the sponsor becomes costlier while the factions compete with each other and each wants to stay in the judge's favor. The sponsor's other agenda looks better almost by default, since it meets less organized resistance. It needs existing rivalry, a prize both sides want, and visible criteria, and it weakens when a broker with standing in both camps calls a truce, when the prize is too small, or when a board or major customer forces the factions together.
The thinking behind it
Muzafer Sherif Muzafer Sherif's Intergroup Conflict and Cooperation: The Robbers Cave Experiment (1961) found that two groups set to compete for prizes only one could win developed hostility and negative stereotypes of each other: competition over scarce rewards was enough. A contest between rival factions draws on that effect, which is why it absorbs so much of their attention. It is also the warning on this page, since the hostility can outlast the prize.
Edward Lazear Edward Lazear's work with Sherwin Rosen, Rank-Order Tournaments as Optimum Labor Contracts (1981), shows that paying by rank can draw strong effort from every contestant, the losers included, and that contestants compete on whatever the judge is seen to reward. That is the case for making the prize real and publishing the criteria: the factions' effort goes into producing the work the criteria describe, such as a better growth plan.
Mancur Olson Mancur Olson's The Logic of Collective Action: Public Goods and the Theory of Groups (1965) explains why a concrete prize beats a diffuse cause. Each member of a large group gains from a shared goal whether or not they contribute, so the shared benefit of opposing a sponsor's plan motivates little, while a prize only one faction can win motivates a great deal. Factions focused on the contest have less left for organizing against anything else.
When it fits
Fits a company with rival units that both want something you can give only one of: headcount, a launch slot, a flagship client. You need authority over the prize, criteria you can publish, and a judge both sides accept. It suits moments when several of your plans are in flight and the factions' energy is better spent producing something.
How to use it well
Make the prize real and the contest fair.
- Publish the prize, the criteria, the deadline, and the judges to both factions at the same time.
- Choose a prize that produces work the company needs, such as a growth plan or a pilot.
- Run your other proposals through their normal process, with full documents, on their normal schedule.
- Announce the result with the reasons, and give the runner-up something if their work earned it.
Tell both factions plainly that the contest is a contest, and that every other item on the agenda stands on its own.
What it costs and where it backfires
Contests leave a loser, and a loser who feels cheated becomes an opponent with a grievance. Rivalry heated up for a prize can outlast the prize and cost you cooperation between those factions later. Each faction will notice what else moved while it competed, and if the larger item was hard to see, it will read the contest as cover. The line is crossed when the prize is invented, the contest is rigged, or the larger item is kept from people entitled to review it; then it is deception.
When it is used on you
Compete for the prize if it is worth having, and check what else is on the agenda during the same weeks. Agree with the rival faction on a truce over any larger item you both care about, and ask that it get its own meeting, its own documents, and a named sponsor.