Rivalry: The Good, the Bad and the Ugly Larry Bird vs. Magic Johnson. British Airways vs. Virgin Atlantic. Uber vs. Lyft. Rivalry can be either a powerful driver of achievement, or a force that leads to corruption and chaos.

By Laura Entis

Opinions expressed by Entrepreneur contributors are their own.

Competition and rivalry may share the same basic DNA, but they are not synonymous. While competition typically remains objective and stakes-based, rivalry operates on a more personal, and therefore frequently less rational, playing field.

Opponents engaging in strict competition are "focused on the prize -- it matters less who they are competing against," says Galvin Kilduff, a professor at NYU's Stern School of Business who has been studying rivalry for years. When the relationship between two players moves to the forefront, however, and the act of winning becomes more psychologically important than procuring the prize itself? That's when competition morphs into rivalry.

The good.

Because rivalry's potency lies more in the power of comparison than end-results, it can be an effective driver of achievement, kicking both effort and performance into a gear that would be difficult to maintain if participants were solely concerned with tangible results.

Particularly in sports, individual rivalries can dramatically elevate the level of play for continued stretches. Take the rivalry that developed between basketball greats Larry Bird and Earvin "Magic" Johnson throughout the 1980s. Evenly matched, the two heavyweights used one another as benchmarks, to the point where Johnson reportedly had trouble sleeping and Bird obsessed over whether or not Johnson's regime was more intense than his own. "Everybody said there was a hate element. There wasn't hate. I just had so much respect," Bird told NPR. "You never let your guard down because he was so good."

Related: 3 Ways to Use a Rivalry to Increase Your Business Performance

Unsurprisingly, high-profile rivalries can generate a lot of media attention and press coverage that, in turn, elevates the stakes even further and provides more incentive for both actors to stretch the parameters of their ability. "It's motivating for the two parties involved but it can also be really exciting for observers and fans," says Kilduff. "It can be hard to untangle those two things."

The Bird/Johnson rivalry is a good example of this. "We did it in a way where we caught the imagination of everyone in America," Bird told The L.A. Times. "People wanted to see us play against one another."

This same effect can occur with business, too. Rivalries between two corporations can elevate the bar for the entire industry. "The rivalry between Intel and AMD has been considered generally healthy for the industry in that it seems to push innovation -- you could say the same thing with Samsung and Apple with the smartphones, says Kilduff."That's the upside of an intense competition."

And business rivalries also often find themselves in the media spotlight, providing free press to both players involved (a recent example of this would be Uber and Lyft's epic battle for ridesharing supremacy – but more on that later).

The bad.

While rivalry can increase both effort and performance, rivals engaged in continued battle run the risk of developing tunnel vision – when success is measured solely by how one stacks up against a single competitor, it can lead to a preoccupation that turns on the blinders to other competitive threats.

While Kilduff stipulates that in any real-world case studies there are various factors at play and so attributing causation can be tricky, he points to the rivalry between U.S. automakers in the 1990s. "They were so intensely competing with one another that they didn't pay attention to anyone else, allowing Japanese automakers to come in and overtake them." A similar dynamic played out between Coke and Pepsi; The soft drink giants poured so much energy into tracking one another's movements that Kilduff speculates they entirely missed the emergence of increasingly popular energy and health drink brands.

Related: How to Compete -- and Win -- When Rivals Cut Prices

The ugly.

Left unchecked, rivalry can fester into a warped motivator; when success is defined solely by how one measures up against a single competitor, the incentive to engage in unethical behavior sharply increases. From his research, Kilduff has found that subjects who are asked to think about a personal rival before performing a task score significantly higher on the Machiavellianism scale than subjects who recalled a non-rival competitor; they are also more likely to inflate their performance.

Add real-world stakes, and rivalry can lead to corruption and chaos. Kilduff points to the figure skating scandal involving Tonya Harding and Nancy Kerrigan– in which Harding allegedly orchestrated a physical attack on Kerrigan – as the classic example of a rivalry gone sour.

But Kilduff's favorite example of rivalry's dark underbelly is the dirty tactics that emerged in the battle between British Airways and Virgin Atlantic in the early 1990s, in which British Airways launched an underground campaign against Virgin doing everything from "circulating rumors that Richard Branson had come down with HIV" to "impersonating Virgin employees and call up their customers to tell them that their flights had been cancelled when they hadn't."

Sound familiar?

The parallels between the current PR battle taking place between Uber and Lyft – both companies have been accused, on multiple occasions, of having employees book rides on the competing service before abruptly canceling them – are striking. "The Uber and Lyft one is actually quite interesting – although it's hard to say, it could be just a product of Uber being intensely competitive," says Kilduff. "Maybe they would have gone after anybody else in the industry in a similar fashion."

As with many high-profile rivalries that take a turn for the ugly, this one's captured the spotlight – although it's unclear as of yet whether or not it's helping or hurting both companies' bottom lines. "We'll have to watch to see how it plays out."

Related: Lyft Says Former COO Took Confidential Files With Him to Uber

Wavy Line
Laura Entis is a reporter for Fortune.com's Venture section.

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