The Truth About Competition And Competitive Behavior - Aditya Yadav

1. *
“Running an Agile Fortune 500 Company”
Aditya Yadav, aditya.yadav@gmail.com
in.linkedin.com/in/adityayadav76

2. * A Typical Global Company
* Fortune 500/1000
* 200 Divisions
* 40 Countries
* 25000 Employees
*

3. *
@ Acme Inc.

4. * Original Question “Competition is bad for
society and so is the 700x CEO Salary. Shouldn’t
we revise policies?”
* The Correct Question - “Lets understand
Competition in the larger context of our World
before deciding shall we?”
*

5. *
And The Philosophy Behind The Answer

6. *

7. * Nobody can deny that resources in our world are limited.
* If you distribute them equitably then the portion per person will be inconsequential and nobody will benefit.
* The reality: Is that some people will have more and some people will have less, in your organization and society.
* The problem: is Not Someone Having more, but the means they use to get more and what they do with it. More by
itself is never a problem, neither conceptually, nor practically.
* Resources will have to be allocated based on selection/elimination processes, some people associate that with
Capitalism.
* Nothing wrong with modern schools promising all round development. But the ones that offer to eliminate all
exams and deliver on students passion make students incapable of competing in a resource limited world.
* If you lose the ability and practice of competing and dealing with successes and failures you are not going to
succeed in life. There are no entitlements to success in this world. Never were Never Ever will be (with some
exceptions)
* The reality: Its is great to be idealistic and passionate but one cannot ignore utilitarian realities.
* The reality: If you don't like mathematics you are out of luck. Deal with it, work hard and pick it up before its too
late. 90% of things in the world are based on Mathematics. But its also true that you don't need to master quantum
mechanics either. Most problems in businesses and career's happen when people take shortcuts and avoid math’s.
* General Rule: Competition Free Entitlements lead to large scale mediocrity besides irreparable damage to the
society and the world, but there is slightly more logic besides that and we are going to discuss it.
*

8. * Competitions and Exams are yet another selection process.
* Not everybody will find every version of those suitable or appropriate
in every context.
* Its pointless to debate which ones are better as long as they are free
and fair for everyone and serve the purpose of selection or
elimination
* It is pointless to debate if they correlate with success, because no
measures of factors can ever guarantee success.
* Selection/Elimination Criteria’s like Degree’s Certifications Skills
Experience Brand School etc. are also arbitrary conceptually but as
long as they are within legal bounds they serve the purpose and
should be viewed in that spirit.
* At some point in life you have to stop behaving like a critic and play
the game of life in a world with scarce resources.
*

9. * We are not saying all competitions are perfect, effective,
correctly implemented or fair…
* We are arguing that the overall concept of competitive
behavior is The Law Of The World
* And that the only probable way to violate that law is
probably space conquest i.e. when resources per human
probably becomes an order more than what they can
consume and the cost of resources are insignificant.
* As long as resources are scarce Competition is the Reality
and no Globally Equitable and Totalitarian schemes are
feasible/viable.
* This is a more aggressive stance based on (resources) theory
than simply saying non-competition is not good because its
against freedom(s) or capitalism.
*

10. * Every University has a grading system
* Harvard produces 800 MBA’s/year
* Their selection process is one of the toughest in the world, has not been questioned to be unfair
* Compared to the Resources available for the 800 graduates/year post graduation i.e. jobs/companies
willing to hire them at a premium
* So HBS if they choose to has the option to drop their grading system compared to other Universities
which should probably continue to use a Grading system.
* Because it makes no sense to Further Rank their students
* This also benefits Learning as Learning becomes the Focus rather than Grades
* And also leads to the Concept of The Life Changing HBS Experience. If you have attended and
participated in the HBS class for the entire course then you have learnt as much as you could have and
then its up to you to go out there in the Business World and continue learning and capitalizing on your
education.
* And that one number/grade on your degree cannot possibly represent The Degree of your HBS
Experience of which you have more than enough than what’s required. Which states the Quality of the
HBS Education System.
* Moral: Competitive Behavior is a Reality of the World but it doesn’t need to be applied in niche cases
arbitrarily where its not required just because competition is the norm. And vice versa it shouldn’t be
abolished in cases leveling the playing field, where resources are scarce and competition is required,
just because of a populist opinion. The reasons have to be grounded in sound theory(s) and not
opinions.
* This is a direct implication of the theory.
*

11. * Competitive behavior is a reality of our world
* It definitely increases Quality and Excellence
* But it also definitely causes Depression from Repeated Losing, Psychological Effects, Conflicts of
Interest…
* Interventions and Support for fair competition helps.
* The general rule is there shouldn’t be (m)any internal competition within the Primary Function of the
Business because that maximizes conflicts of interest
* When there is a scarce organizational resource, it shouldn’t be allocated equitably but rather
competitively, assuming its not directly for the primary function of the business but rather away by
many levels of indirection from the direct value chain e.g. Training, Library, Conference rooms for
meetings (not sales/client)…
* You can compete for scarce Marketing and Hr but not for Sales, R&D and Finance. (speaking very
generically, I know many would grossly disagree with this statement but I’m trying to convey a point)
* One can also say you shouldn’t compete for operational needs (Hmmm! Think budgets) and have all the
tactical weapons and arsenal at your disposal but rather compete for auxiliary probabilistic outcome &
optional needs e.g. we need $30m for operations this year which should be given to us irrespective of
anything else but we will compete for $20m of practice growth budget.
* This is very different from the practice of approving $50m division budget or haggling about it being
$45m or $55m
* Internal Competition for something which is directly needed for business success leads to failure. Or
understand it this way if you are internally competing when your survival is at stake The Organization
Will Fail with distorted unwanted Outcomes.
*

12. * A lot of citizens in developed countries Hate people in developing
countries
* Because they think their survival is at stake, their livelihood, way of life,
luxuries, career’s etc.
* Governments launch interventions to Save(???) them.
* Obviously those have no chances of succeeding and have distorted effects
on the Society and Countries.
* The policy should only be
* You will be assured of 3 basic meals a day
* You will be entitled to education
* You will be entitled to healthcare
* We will make sure you survive, but beyond that
* Compete and Succeed.
* There will be no other entitlements
* There is no other practical alternative today nor going to be tomorrow
*

13. * Oh! The CEO’s of such and such companies are making so much
money even 700x times that of their entry level employees
* Go back to the Golden Rule: Scarce Resources, Competition and
Differentials in success and what people will have
* Lets critically examine the argument against CEO Salaries
* The CEO Salaries don’t drive their Conduct. There is no causation let
alone correlation.
* There are inherent problems in Business’s, measures of business
success, etc. Are you even solving the actual problem by trying to
curb CEO Salaries?
* How would being a Poor CEO automatically fix Conduct or Ethics?
* Why is 700x salary bad and say 40x good? 40x is also as arbitrary a
number as 700x
*

14. Aditya!!!
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