Cooperation, Competition, and Team Performance: Towards a Contingency Approach

Abstract

This article poses the question which reward structure (cooperative or competitive) has the best effects on team performance under which circumstances. Specifically, a cooperative reward structure is predicted to increase performance on means-interdependent tasks, while a competitive reward structure is predicted to increase performance on means-independent tasks. Furthermore, it is predicted that cooperative structures will lead to better performance when the team is high on extroversion and on agreeableness than when the team is low on extroversion and agreeableness. In a laboratory experiment with 75 four-person teams, these hypotheses were tested by letting teams engage in an interactive military command and control task. Results showed that competitive teams performed best on the means-independent element of the task (e.g. the speed with which targets were engaged), while cooperative teams performed best on the means-interdependent element of the task (e.g. the team's accuracy in preventing friendly fire kills). Moreover, a cooperative reward structure was shown to particularly benefit performance when team members were highly extroverted or highly agreeable. It is concluded that regarding the effects of reward structure, there is no one best way. For means independent tasks, a competitive structure helps team performance, while for means interdependent tasks, a cooperative structure helps performance, especially when team members are interpersonally skilled. Therefore, we conclude that the group structure and group composition need to be aligned with the desired performance component in order to maximize performance on that component.