Teaching Kids To Lose Gracefully

W e've all heard the philosophical spin that's been placed on failing; it teaches us how to succeed. Whether it's through lessons provided during trials and tribulations, or some reflection that causes us to look at our efforts, behaviors, or strategies more objectively, failure is not only expected, but is viewed as a key ingredient of success.
Kids don't understand this concept.
They also can't discern the difference between failing and losing. Simply put, failure carries judgement (whether by the person failing or those who are aware of their failings), and is more personal as a result. Losing implies you were not good enough to win, and often takes place publicly (which carries a threat of embarrassment).
One can hide personal failure, but not losing publicly. Winning is an adrenaline rush and dopamine boost. Neurologically, the euphoria of winning can be addictive. So are the social rewards that accompany winning such as approval, acceptance, and adulation - the very things that all developing kids crave and strive for. Emotions linked to these rewards are fragile and can be easily broken if not properly framed.
When kids lose publicly we have to monitor both their actions and interactions. How they mentally and emotionally take a loss is the essence of good or bad sportsmanship. 
Ultimately, we want our kids - and all kids - to be able to respond to a loss with grace (i.e., showing gratefulness for the opportunity to compete, and an acknowledgement of their opponent's achievement) instead of reacting to their own disappointment to a degree in which a negative display of attitude and emotions in a loss dims someone else's momentary spotlight.
And that's the point: It's just a moment, and it's just a game.
Parents and coaches should guide kids to understand that winning or losing is not about them, but about the effort (or lack of effort) they put forth - before and during a competition - that lands them on either side of the win/lose equation. These are the lessons that help them not only win future games, but the competitions they will face later in life.