Bachelor of Business
Administration
-------------------------Business Management
3A
Chapters
Aims of This Module
Upon completion of this module, the learner will be able to:
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Apply skills in the management of conflict within the workplace.
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Apply the principles of business ethics in the workplace.
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Discuss the role of corporate social responsibility in the business
environment.
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Display knowledge of industrial relations and its impact on human
resources.
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Describe the legislative framework in which a business operates.

Analyse and evaluate how skills in managing conflict, business ethics,
corporate social responsibility, industrial relations and the legislative
environment enable effective performance within a business context of
transformation.
Section 1 - Introduction
Section 2 – Managing Conflict
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What is Conflict?
“Make no mistake about it. Conflict is an unavoidable aspect of modern life”
These definitions highlight some important characteristics of conflict:
Goal incompatibility: this takes various forms within organisations.
Interdependency: for there to be conflict, there needs to be some
degree of interdependency between parties.
Interaction: for there to be conflict, it needs to be expressed whether
overtly or covertly.
Perception: it is possible for conflict to be perceived, and therefore the
sources of conflict can be real or imagined.
Functional and Dysfunctional Conflict
Types of Conflict
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Interpersonal Conflict: This occurs between individuals within an
organisation due to differences in their goals, values or personality.
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Intragroup Conflict: This arises within a department, team or group, and
relates to differences in goals, values, perspectives and personality.
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Intergroup Conflict: This refers to conflict between groups, teams and
departments.
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Interorganisational Conflict: This conflict manifests between two or
more organisations.
Sources of Conflict
Goal Incompatibility
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Mutually Exclusive Goals where the achievement of one party’s goal is
viewed as threatening to the achievement of another party’s goal.
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Insufficient Shared Resources where an organisation has a limited
number of resources (money, personnel and equipment) to distribute
across the departments, each of which have different goals.
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Different Time Orientations where the goals of different departments
have different time lines.
Structural Design
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The Nature of the Interdependence, where the nature of the
interdependence determines the potential for conflict:
◦ Pooled interdependence
◦ Sequential interdependence
◦ Reciprocal interdependence
◦ Lack of Substitutability
◦ Power Differentials
Different Role Expectations
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Role Ambiguity, which occurs when the tasks and behaviours expected
from an individual holding a particular role are not clear, as a result of
vague communication about the role.
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Role Conflict occurs where expectations by the party holding the role
are different to expectations for other parties (such as managers,
fellow employees, clients, etc.)
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Role Overload occurs when “role expectations exceed a party’s ability
to respond effectively”
Degenerative Climate
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A degenerative climate is one which encourages dysfunctional conflict
and where win-lose attitudes are prevalent .
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Degenerative climates usually result when there is a clash between
values and expectations of individuals or groups.
Personal Differences
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We have a natural affinity with certain people and an immediate dislike
of others. Personal differences often lead to conflict due to contrasts in
values, behaviours and perspectives
Outcomes of Conflict
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Functional Conflict
◦ Functional conflict has positive results for an organisation in that it stimulates
innovation and production.
◦ Intragroup Benefits
◦ Intergroup Benefits
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Dysfunctional Conflict
◦ Intergroup Problems
◦ Intragroup Problems
Conflict Management Styles
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Competing Style
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This style is assertive and uncooperative, and is evident where an
individual or group seeks to satisfy their own interests without regard
for others
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Collaborating Style
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This style is assertive and cooperative. Parties to a conflict seek a
mutually beneficial outcome through cooperation
Conflict Management Styles (cont.)
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Avoiding Style
This style is unassertive and uncooperative. People who adopt this
style do not pursue the goals of the other party, nor do they pursue
their own.
Accommodating Style
This style is unassertive and cooperative. People who adopt this style
seek to put the other parties‟ interest over their own
Accommodating Style
This style is unassertive and cooperative. People who adopt this style
seek to put the other parties‟ interest over their own
Conflict Management Styles (cont.)
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Compromising Style
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This style falls between assertive and cooperative behaviours. People
who demonstrate a compromising style are prepared to “give
something up” in the interests of reaching a comprised outcome
Strategies for the Management of Conflict
Strategies for Reducing Dysfunctional Conflict
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Superordinate Goals
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“One of the most effective ways to reduce conflict is to determine an
overriding goal that requires the cooperative effort of both conflicting
parties…such a goal must be unattainable by either party alone and of
sufficient importance to supersede all their other goals”
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Increased Communication
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Increasing communication provides a means to address and correct
misunderstandings, diminish the prevalence of negative stereotypes and
ultimately provide for the development of positive feelings amongst
parties
Strategies for Reducing Dysfunctional Conflict
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Problem Solving
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Problem solving is a formal means of bringing conflicting parties
together to discuss their differences and craft a way forward.
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Expansion of Resources
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Scarce resources are frequently the source of conflict within
organisations. To address this, where possible, organisations should
expand the available resources.
Strategies for Reducing Dysfunctional Conflict
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Third Party Judgement
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A less time consuming and less expensive approach to managing conflict
than the problem solving strategy is the strategy of third party judgement.
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Changing Organisational Structure
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Conflict could be a signal that the organisation’s structure needs to be
changed, bringing about new organisation to tasks and groupings of staff as
well as new levels of integration.
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Avoidance
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At times conflicting parties can ignore the dysfunctional situation in the
hope that the conflict will resolve itself.
Section 3 – Business Ethics
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What are “Ethics”?
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Ethics are related to morality. While morality distinguishes between
right and wrong, ethics are the guidelines as to how morality is
achieved. Morality (i.e. what is right or wrong) is determined by the
community or society in which a business operates.
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Therefore, different communities and societies will have different
beliefs as to what is right and wrong. Ethics are relative to the morals
of a particular society.
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For example, in Spain abortion is regarded to be “wrong” and is
therefore prohibited, while in Japan, abortion is considered to be
“acceptable” and is frequently utilised as a means of birth control.
The Importance of Ethics in Business
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Ethical behaviour is imperative in business, primarily because unethical
behaviour inflicts harm on others. The pursuit of self interest with no
consideration of the societal interest results in disaster not only for
the individual but also for the entire society as scarce resources are
wasted and destroyed.
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Unethical behaviour results in the loss of a manager’s and/or
organisation’s reputation. Customers and other stakeholders will come
to view the organisation with suspicion and mistrust, which will
ultimately be bad for business.
Resolving Ethical Dilemmas
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Managers and employees are presented with a range of ethical
dilemmas in the workplace.The ethical dilemmas could include:
◦ Price fixing
◦ Favouritism
◦ Advancing within the business by „stepping on others‟
◦ Failing to inform employees of key issues in the interests of protecting management
◦ Failing to address discrimination
◦ Abusing privileges and perks
◦ Producing products and services which are harmful to the environment
Ethical Models
Utilitarian Model
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“Utilitarianism means to act in such a way that the greatest good is achieved
for the greatest number…it guides the decision maker to choose the
alternative that produces the greatest net social good when all the
stakeholders are considered”
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When confronted with an ethical dilemma, the utilitarian model should
be used as follows:
◦ Identify alternative courses of action
◦ Determine both the benefits and harms of each alternative course of action for all
groups of stakeholders
◦ Select the alternative which provides for the most benefits and least harm to the
greatest number of stakeholders
Utilitarian Model (cont.)
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Organisational Goals: “providing the greatest good for the greatest
number in a competitive market system means focusing on maximizing
profits”. Profits should be kept at an optimal level which ensures the
competitiveness of the organisation.
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Efficiency: In pursuing the achievement of organisational goals,
managers and employees need to be efficient. This entails minimising
inputs and maximising outputs.
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Conflicts of Interest: It is important that managers and employees do
not have personal interests which conflict with the achievement of
organisational goals.
Moral Rights Model
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Ethical decisions and behaviours within the moral rights framework
focus on the protection of the fundamental rights and privileges of
individuals. Any decision or behaviour that violates the rights of an
individual is therefore wrong and unethical
◦ Life and Safety
◦ Truthfulness
◦ Privacy
◦ Freedom of Conscience
◦ Freedom of Speech
◦ Private Property
Justice Model
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Distributive Justice Principle
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Individuals need to be treated the same, unless they differ in ways
which are relevant to the situation.
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Fairness Principle
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This principle emphasises that both the organisation and employees
need to fulfill their responsibilities
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Natural Duty Principle
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This requires that employees and organisations engage in behaviour as
responsible members of society.
How to Improve an Organisation’s Ethical Climate
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Role Models
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Screen Potential Employees
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Ethics Training
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Reinforce Ethical Behaviour
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Whistle Blowing
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Develop a Meaningful Code of Ethics
Gender and Ethics
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Research shows that while men view moral problems from a justice
perspective, women tend to view them from a care perspective. So
while men focus on “the rules of the game”, women focus on the
dynamics of the situation and the people involved.
Section 4 – Corporate Social Responsibility
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What is “Social Responsibility”?
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Nieman & Bennett (2006) expand on their definition and identify that
social responsibility includes:
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Improving the quality of life of employees
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Creating a social infrastructure which benefits the community,
particularly in terms of development and educational opportunities
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Fulfilling an obligation to create a better social, ecological and aesthetic
environment for the benefit of employees, their families and the
greater community
Levels of Social Responsibility
Social Obligation
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Economic responsibility where the organisation is responsible for
maximising profits and providing goods and services to the market at
reasonable prices.
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Legal responsibility where the organisation is required to comply with
the regulatory business framework and labour legislation
Social Reaction
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At this level it is argued that an organisation’s maximisation of profits
and provision of goods and services does not amount to social
responsibility. Rather, focus should be given to societal, environmental
and ecological consequences of an organisation’s actions.
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Socially responsible behaviour at this level therefore involves the
organisation’s voluntary participation in projects that assist in solving
societal and environmental problems
Social Responsiveness
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At this level, social responsibility involves the organisation being
proactive, and actively seeking to prevent or find solutions to societal
and environmental problems.
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At this level organisations also engage with the government about
legislation and anticipated social and environmental problems.
Stakeholders to Whom Business is Responsible
Evaluating Corporate Social Performance
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Broad performance criteria: Companies need to broaden the focus of
their organisational performance evaluation to include a focus on social
and environmental initiatives.
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Ethical norms: Companies need to advocate ethical norms for the
organisation, industry and business in general.
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Operating strategy: Organisations need to maintain and improve
current standards of the physical and social environment.
Evaluating Corporate Social Performance (cont.)
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Response to Social Pressure: Companies should participate actively in
solving existing problems.
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Legislative and Political Activities: Organisations need to work with
external bodies, such as the government to promote and facilitate the
drafting of legislation and regulations regarding the protection of the
natural and social environments in which they operate
Section 5 – Industrial Relations
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What is “Industrial Relations”?
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Industrial relations “can be described as a complex system of individual
and collective actions as well as formal and informal relationships existing
between the state, employers, employees and related institutions concerning
all aspects of the employment relationship”
Who are the Participants in Industrial Relations?
Labour Relations Act (Act 66 of 1995)
Unfair Dismissal
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a worker intended to or did take part in or supported a protected
strike or protest
a worker refused to do the work of a striking or locked out co-worker,
unless his refusal will endanger life or health
a worker is forced to accept a demand
a worker intended to or did take action against an employer by ◦ exercising a right
◦ taking part in proceedings
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a worker is pregnant or intends to be pregnant
an employer discriminated against a worker because of race, gender,
sex, ethnic or social origin, colour, sexual orientation, age, disability,
religion, conscience, belief, political opinion, culture, language, marital
status or family responsibility
an employer cannot prove ◦ a worker‟s misconduct or inability
◦ that the employer‟s operational needs are valid
◦ that the dismissal procedure was fair
Promotion of Collective Bargaining and Worker
Participation
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Collective Agreements
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Bargaining Councils
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Statutory Councils
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Workplace Forums
Dispute Resolution & Labour Peace
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CCMA
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Labour Court
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Labour Appeal Court
Basic Conditions of Employment Act (No 75 of
1997)
The Act regulates the following employment conditions:
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Work time and rules
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Remuneration and deductions
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Termination of employment
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Administrative obligations
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Prohibition of the employment of children
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Variation of basic conditions of employment
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Monitoring, enforcement and legal proceedings
Employment Equity Act (Act 55 of 1998)
Key aspects of the Act include:
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The beneficiaries of the Act are known as the “designated group”. The
“designated group” includes African, Indian and Coloured people as
well as women and people with disabilities.
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Companies that are required to comply with the Act are known as
“designated employers” A designated employer has a workforce of 50
employees or more (RSA, 1998a).
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The Act prohibits unfair discrimination and requires that affirmative
action measures be implemented.
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Failure to comply with the Employment Equity Act will result in
organisations having to pay considerable fines.
Skills Development Act (Act 97 of 1998) and Skills
Development Levies Act (No 9 of 1999)
The key aspects of these Acts include:
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Companies pay 1% of their payroll to Sector Education Training
Authorities (also known as Setas) as a Skills Development Levy (RSA,
1999)
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Companies are able to claim back at least a portion of their Skills
Development Levy by engaging in annual workplace skills planning and
implementation.
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Companies are able to claim back further money from their Seta by
engaging in strategic skills initiatives.
Occupational Health & Safety Act (No 85 of 1993)
Some of the duties of employers include:
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Ensuring that the work systems, plant and equipment is safe to use
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Providing instruction and training on safety issues within the workplace
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Establishing what hazards are associated with a particular job, and take
precautionary measures
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Informing all employees of the danger involved in their work
Occupational Health & Safety Act (No 85 of 1993)
Some of the duties of employees include:
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Taking care of one’s own health and safety, as well as others who may
be affected by one’s actions
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Carrying out orders relating to health and safety rules
Unemployment Insurance Act (No 63 of 2001)
The Act provides for the following benefits and allowances:
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Illness benefits
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Maternity benefits
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Adoption benefits
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Dependant benefits
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Unemployment benefits
Section 6 – The Legislative Framework
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The Constitution
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The Constitution is the highest level of law; it is the supreme Act of the
country and guides all other legislation.
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The Constitution enshrines the rights of all South Africans and focuses
on addressing historical inequalities
Broad Based Black Economic Empowerment Act
(No 53 of 2006)
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Categories of Black Ownership
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BEE Industry Charters
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BEE Scorecard
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A company will be assessed against the above criteria and receive a
score for each category, which will be weighted according to sector
guidelines. The total score which an organisation receives will be
interpreted as follows:
◦ 0 – 40: the organisation is seen to make a limited contribution to BEE
◦ 40 – 65: the organisation is seen to make an acceptable contribution to BEE
◦ 65 or more: the organisation is seen to make a good contribution to BEE
Broad Based Black Economic Empowerment Act
(No 53 of 2006)
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Relevance of Other Legislation to the BBBEEE Act
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BEE & Competitive Advantage
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Given the transformation of South Africa and the changing consumer
base, it is unlikely that organisations that fail to transform in terms of
BEE will be able to maintain their competitive advantage or even
survive. Research shows that BEE compliant organisations are on the
increase and that they have a definite advantage over those that are
not compliant
Labour Legislation
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There are various pieces of labour legislation which facilitate economic
and social transformation within and outside of the workplace.
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These include:
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The Labour Relations Act
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The Basic Conditions of Employment Act
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The Occupational Health and Safety Act
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The Unemployment Insurance Act
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The Employment Equity Act
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The Skills Development Act
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The Skills Development Levies Act
Other Legislation
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Preferential Procurement Policy Framework Act
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Competition Act
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Promotion of Access to Information Act
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Environmental Legislation
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Industrial and Trade Regulations
Assignment Guidelines
1.1 Explain what Corporate Social Responsibility is and evaluate MTN’s
efforts in implementing its intended Corporate Social Responsibility
drive across the globe.
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Essay question i.e. Intro, Body, Conclusion.
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Keep all points/arguments in body.
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Firstly, explain CSR.
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Secondly, apply your definition and model to MTN.
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Remember to reference correctly.
(20 Marks)
Assignment Guidelines
1.2 Discuss the concept of ethics in business and comment on MTN’s
business conduct.
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Firstly, explain ethics in business.
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Secondly, using this, comment on MTN’s business conduct.
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Remember to reference correctly.
(15 Marks)
Assignment Guidelines
2.1 List any 5 stakeholders of MTN.
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(5 Marks)
Simply list 5 stakeholders of MTN.
2.2 Discuss 5 criteria that should be considered in evaluating MTN’s
approach to Corporate Social Responsibility.
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Identify and discuss fully the 5 criteria that SHOULD be considered
when evaluating a firm’s approach to CSR.
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(10 Marks)
Remember to reference correctly.
Assignment Guidelines
Question 3 (20 Marks)
Discuss the rights and obligations of employees, unions, employers and
employer organisations with respect to freedom of association,
organisational rights, strikes and lockouts.
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Essay question.
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Focus on the rights and obligations of employees, unions, employers
and employer organisations.
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Explain in light of freedom of association, organisational rights, strikes
and lockouts.
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Remember to reference correctly.
Assignment Guidelines
Question 4 (15 Marks)
Differentiate between functional and dysfunctional conflict and show how
conflict can be managed.
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Firstly, differentiate between functional and dysfunctional conflict.
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Secondly, elaborate on ways conflict can be managed.
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Remember to reference correctly.
Assignment Guidelines
Question 5 (15 Marks)
Explain the tripartite system in Labour Relations and describe the role of
each participant in the system.
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A tripartite relationship contains three parties.
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With regards to Labour Relations, describe fully, the roles of each of
the three parties involved.
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Remember to reference correctly.
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Email: randhir@mancosa.co.za
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031 300 7200 – Randhir Ramharack in academics
Examination Guidelines
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Your exam will be on 9th June 2011.
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Your supp will be on 22nd July 2011.
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You do not need to reference in the exam.
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You will have three hours to answer an closed book exam out of
100.
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Typically, your exam will comprise of short question attracting
anywhere from 5 to 20 marks each.
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You should also receive at least one case study attracting between
15 and 50 marks.
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You will receive further guidelines closer to the exam.