Lecture 12 - Managing Conflict
Learning Criteria:
Effects of conflict on organisation performance
3 sources of conflict
Pondy’s 5 stages of organisational conflict
Forms of manifesting conflict
5 ways of handling conflict
5 ways to promote compromisation and collaboration
Organisational conflict - Self-interested struggle that arises when the goal-directed
behaviour of one person or group blocks the goal-directed behaviour of another person or
group
1. The Effect of Conflict on Organisational Performance:
● A moderate level of conflict or healthy competition can be beneficial for
organisations, as it encourages innovation and productivity.
● However, too little or too much conflict can be detrimental to organizational
performance.
Low conflict
● When the level of conflict is low, the level
of performance is also low.
● Minimal conflict might lead to
complacency, limited innovation, and
reduced motivation, resulting in suboptimal
performance.
Functional/constructive conflict
● The level of performance peaks at the
optimal level of conflict.
● Exposes weaknesses in decision-making
and design, prompting organisational
improvements.
● Managers may shift power to groups best
suited to meet current needs.
● Moderate conflict fosters healthy
competition, and innovation, and motivates
teams to achieve goals.
Dysfunctional/destructive conflict
● As conflict levels increase beyond the
optimal point, performance begins to
decline.
● Conflict may become emotional or
personal, with managers clashing and the
organisation fragmenting into competing
interest groups.
● Top managers must prevent conflict from
exceeding the optimal level and direct it to
enhance organisational performance.
2. Sources of Conflict:
(i) Differentiation
● Differentiation in an organisation occurs when people and tasks are grouped or
split up into functions and divisions to produce goods and services.
● The splitting of the organisation into functions or divisions produces conflict
because it makes the differences in functional interests and goals apparent.
● The sales department is responsible for
securing the order for products in the
company.
● Thus, the sales department views itself as
the important department in the company
because, without sales, there is no
production.
● The manufacturing department is responsible
for producing the products in the company.
● Thus, the manufacturing department views
itself as the important department in the
company because, without them, no product
can be delivered even if the sales department
can secure the order for products.
(ii) Task Relationships
● Task relationships generate conflict between people and groups because
organisational tasks are interrelated and affect one another.
● Overlapping authority, task interdependence, and incompatible evaluation
systems may stimulate conflict among functions and divisions.
● The sales department is dependent on the
manufacturing department to produce the
products that have been ordered.
● The manufacturing department is dependent
on the sales department to provide
information about the order of products.
● If the manufacturing department cannot
deliver the products on time, the sales
department will receive complaints from
customers.
● If the sales department does not provide the
relevant information, the manufacturing
department cannot produce the products as
requested by customers.
(iii) Scarcity of Resources:
● Competition for scarce resources produces conflict.
● For example: Budget fights can be fierce when resources are scarce.
3. Pondy’s Model of Organisational Conflict:
Stage 1: Latent conflict
● In the first stage, there is no actual conflict. The potential is
there, but latent.
● The potential for conflict to occur includes:
○ Nature of task interdependence
○ Differentiation
○ Scarcity of resources
Stage 2: Perceived conflict
● The stage of perceived conflict begins when one party becomes
aware that its goals are being thwarted by the actions of another
party.
● Each party searches for the origins of the conflict and analyses
the events leading to the conflict.
● The conflict typically escalates in Stage 2.
Stage 3: Felt conflict
● During the felt conflict stage, the parties develop negative
feelings about each other.
● Cooperation and lack of trust decline in this stage.
● The significance of the disputed issue is likely to be blown out of
proportion.
Stage 4: Manifest conflict
● In the stage of manifest conflict, one party decides how to react
or deal with the party that it sees as the source of the conflict and
both parties try to hurt each other and thwart the other’s goals
(hostility).
● Manifest conflict can take in these forms:
➢ Open aggression
➢ Violence
➢ Infighting
➢ Sabotaging
➢ Physical intimidation
➢ Lack of cooperation
Stage 5: Conflict aftermath
● If they cannot prevent the breakdown in communication and
coordination, the conflict advances to the final stage of conflict
aftermath.
● Every conflict leaves an aftermath that affects the way both
parties perceive and respond to future episodes.
4. Ways of Handling Conflict:
Ways of handling conflict:
Description:
Achieving own goals
(horizontal axis):
Interest in helping others
(vertical axis):
1. Compromise
This usually involves
bargaining and negotiation to
reach a solution that is
acceptable to both parties.
Moderate
Moderate
2. Collaboration
(ideal method)
This refers to both parties
working together to satisfy
both their own and other
side’s goals.
High
High
3. Accomodation
This usually involves one
party simply allowing the
other to achieve its goals,
whilst neglecting its own
interests.
Low
High
4. Avoidance
This usually involves both
parties refusing to recognise
Low
Low
the real source of the problem
and act as if there were no
problem.
5. Competition
This leads to the greatest and
most visible conflict because
each party is only looking out
for its own interests.
High
Low
5. Promoting Compromise & Collaboration:
● There are five specific tactics that managers can use to structure the negotiation and
bargaining process to make compromise and collaboration more likely:
➢ Emphasise common goals
➢ Focus on the problem, not the people
➢ Focus on interests, not demands
➢ Create opportunities for joint gain
➢ Focus on what is fair for both parties