chapter seventeen

BADM 310

Management and Organizational

Behavior

Some slides drawn from The McGraw-Hill Copyrighted material.

Managing Conflict, Politics,and Negotiation

BADM 310 - Part 2Managing People & Processes

└ Sep 30: Ch 17 – Managing Conflict, Politics & Negotiation└ Oct 05: Ch 16 – Promoting Effective Communication└ Oct 07: Ch 12 – Human Resource Management└ Oct 12: Ch 5 – Managing Diverse Employees└ Oct 14: Ch 4 – Ethics & Social Responsibility└ Oct 19: Manager’s Forum (tentative)└ Oct 21: Ch 18 - Using Advanced Info Technology └ Oct 26 (Review) and Wed Oct 28 (Exam)

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Learning Objectives

1. Explain why conflict arises, and identify the types and sources of conflict in organizations.

2. Describe conflict management strategies that managers can use to resolve conflict effectively.

3. Understand the nature of negotiation and why integrative bargaining is more effective than distributive negotiation.

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Learning Objectives

4. Describe ways in which managers can promote integrative bargaining in organizations

5. Explain why managers need to be attuned to organizational politics, and describe the political strategies that managers can use to become politically skilled.

└ We will cover some extra material here

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Organizational Conflict

Organizational Conflict└ The discord that arises when goals, interests, values,

perceptions, or styles of different individuals or groups are incompatible

and those people block or thwart each other’s efforts to achieve their objectives.

└ Conflict is inevitable given the wide range of goals for different individuals and groups in the organization

└ Conflict can exist at the individual, group or organizational level

└ There are different types of conflict

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Is conflict bad? Not necessarily

Conflict occurs at different levels(Textbook calls them“types”)

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Levels of Organizational Conflict

Interpersonal Conflict└ Conflict between individuals due to differences in their

goals or values. Intragroup Conflict

└ Conflict within a group, team or department Intergroup Conflict

└ Conflict between two or more teams, groups or departments.

└ Managers play a key role in resolution of this conflict Interorganizational Conflict

└ Conflict that arises across organizations. 17-8

Example – Levels of Conflict

The marketing department and sales department at an industrial product company disagree about how to allocate three new MBA hires. Marketing wants the new hires to devote their attention to market research, and particularly focus groups. Sales wants them to help arrange for customized products for large customers.

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Types of conflict(not in text)

• Relationship Conflict. About WHO (people). Conflict that gets “personal.” Usually dysfunctional, because it is based on personal styles, tends to become about winning rather than functionally resolving conflict.

• Task Conflict. About WHAT the group will decide & do – what to conclude, what criteria to use for decisions, etc. Up to moderate levels can be functional, for reasons discussed earlier.

• Process Conflict. About HOW the group itself works. Occasional process conflict is functional, because it can help the group improve its own way of getting work done.

Example – Types of Conflict

John and George both manage research groups at a high-technology firm. They report to the vice-president of research. John’s group works with established technologies, whereas George’s works on the cutting edge. In staff meetings, they argue frequently, but with little reference to data. Often the arguments seem to be more about who is going to have a say in the direction of the firm’s research than they are about the merits of a specific case.

A new marketing VP challenges a firm’s long-held focus on high-end bicycles. The R&D VP disagrees strongly, saying that high-end bikes are what the firm is about – they are its very identity. The president (who they both report to) cuts the discussion off and asks that the marketing manager discuss the issue with individual vice-presidents and provide data for the group to review before the group considers the issue again. 17-11

Sources of Conflict

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Notice how many sources there are. What common themes are there here?

Sources of Conflict

Different Goals and Time Horizons└ Different groups have differing goals and focus.

Different Evaluation or Reward Systems└ A group is rewarded for achieving a goal, but another

interdependent group is rewarded for achieving a goal that conflicts with the first group.

Overlapping Authority└ Two or more managers claim authority for the same

activities which leads to conflict between the managers and workers.

For these three sources, tangible differences (department affiliations, goals & rewards) lead to differences in perceptions and preferences 17-13

Sources of Conflict

Scarce Resources└ Managers conflict over the allocation of scare resources.

Task Interdependencies└ One member of a group or a group fails to finish a task that

another member or group depends on, causing the waiting worker or group to fall behind.

Status Inconsistencies└ Some individuals and groups have a higher organizational status

than others, leading to conflict with lower status groups. Differences in perceptions (fundamental / not in text)

└ Even when people are aligned in terms of goals, interests and values, the complexity and ambiguity of organizational life means that they often disagree about how to interpret problems and what actions to take. 17-14

Examples – Sources of Conflict

The marketing department and sales department at an industrial product company disagree about how to allocate three new MBA hires. Marketing wants the new hires to devote their attention to market research, and particularly focus groups. Sales wants them to help arrange for customized products for large customers.└ Example 1. The sales VP is evaluated based on annual revenues,

whereas part of marketing VP’s evaluation is based on the number of new products the firm introduces.

└ Example 2. These new hires are the only exceptions to a hiring freeze, so they are being fought over fiercely . 17-15

Examples – Sources of Conflict

The marketing department and sales department at an industrial product company disagree about how to allocate three new MBA hires. Marketing wants the new hires to devote their attention to market research, and particularly focus groups. Sales wants them to help arrange for customized products for large customers.└ 1. Sales always seems to be the group that everyone listens to, so the

marketing group feels they never get their fair share of resources.└ 2. The marketing VP, who was recently hired from another firm known

for its innovation, believes that new products are the key to growth. The sales VP came up through the ranks and always felt that large customers were tough nuts to crack.

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Conflict Management Exercise: How do you resolve conflict?

I try to bring all our concerns out in the open so that the issues can be resolved in the best possible way

I go along with the suggestions of my co-workers I am firm in pursuing my side of the issue I avoid open discussions of my differences with co-

workers I propose a middle ground for breaking deadlocks

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Managing & Resolving Conflict

Whether conflict helps or hurts the organization depends on how it is managed.└ There are many different approaches to managing

conflict└ Generally, the recommended approach is through

compromise and/or collaboration between parties.└ But, there are several other approaches that are often

seen, but are less often effective

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Recommended (“functional”) Conflict Management Strategies

Compromise└ each party is concerned about not only their goal

accomplishment but also the other party’s goal accomplishment and is willing to engage in a give-and-take exchange to reach a reasonable solution.

Collaboration└ both parties try to satisfy their goals by coming up

with an approach that leaves them both better off and does not require concessions on issues that are important to either party.

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Other Conflict Management Strategies

Competition└ each party tries to maximize its own gain and has little interest in

understanding the other party’s position and arriving at a solution that will allow both parties to achieve their goals (often ineffective) .

└ Forcing: Require that other parties follow your wishes without significant consideration of their needs or concerns, often through use of formal authority.

Accommodation └ one party, typically with weaker power, gives in to the demands of

the other, typically more powerful, party (often ineffective) . Avoidance

└ the parties try to ignore the problem and do nothing to resolve their differences (often ineffective) . 17-20

Linking exercise with conflict resolution styles

Please mark in your notes

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Improving Conflict Management: Strategies Focused on Individuals

Increasing awareness of the sources of conflict

Increasing Diversity and diversity awareness and skills

Job rotations or temporary assignments

Permanent transfers or dismissals if necessary17-22

Strategies Focused on the Whole Organization

Changing an organization’s structure or culture

Altering the source of conflict

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Organizational Politics

Organizational Politics└ The activities managers engage in to increase

their power and to use power effectively to achieve their goals or overcome resistance or opposition.

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Organizational Politics

• Organizational Politics– The activities managers engage in to increase their

power and to use power effectively to achieve their goals or overcome resistance or opposition.

• Political strategies– Tactics that managers use to increase their power and

use power to influence and gain the support of other people while overcoming resistance or opposition.

• Politics, then, is all about resolving conflicts and influencing others– The currency of politics is power = ability to influence17-25

How does politics connect with topics we have covered?

Managing and resolving conflict└ Notice how central overcoming resistances is in the prior

slide└ Conflict occurs when one party resists another and is

resolved when the parties come to agreement. Power & Leadership

└ Notice how central power is in the prior slide└ Power was the foundation of leadership because it was the

basis by which the leader influenced others. => Politics is intertwined with leadership and conflict mgmt.

└ But leadership and managing conflict are good things;└ How to reconcile that with the bad name that politics has?17-26

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Sources of Politics

• Political conflict arises from the same basic realities of organizational life that generate conflict

• For example:– Differing Perceptions:

• Differences in goals, experience, values, interests• Complexity, uncertainty, ambiguity: Can’t know what’s best

– Interdependence:• Most managers (even CEOs) rely on others for their success• Formal authority isn’t enough, influence is crucial

– Scarce Resources:• You can’t fund every idea and initiative

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Implications

• => Politics are endemic in organizations– Conflict often cannot be resolved thru neutral,

rational processes where everyone wins or even where everyone agrees.

– Yet unless conflict is resolved, the organization stagnates as managers can’t get things done alone.

– Thus politics, power and influence have an important and functional role in organizations

Two types of politics (not in text)

Dysfunctional politics: Political activity driven by managers self-interest, that does not advance the organization.└ Often hard to tell self-interest from organizational need

Functional Politics: Political activity that allows a manager to gain support for and bring about needed changes that will advance the organization.└ Unresolved conflict = missed opportunities, paralysis,

stagnation└ Put another way: just like managing conflict and

leadership, successful political strategies get things done17-29

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Why Does Dysfunctional Political Conflict Arise and Persist?

• Politics can be a negative force when managers act in self-interested ways for their own benefit.

• Three reasons this happens:– Powerful players that stand to lose from change, may use their

power to tenaciously preserve the status quo.– Ambitious players act to advance their own career to the

exclusion of colleagues and organizational interests.– Unfortunately, distinguishing between actions taken in self-

interest and organizational interest is often difficult.• Group & organizational interests typically overlap individual

interests.

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What can politics do for good?

• Politics drives differing interests and perspectives to be mobilized and reconciled:

– “R&D has a legitimate interest in long-term research, manufacturing in the producibility of a product, marketing in customer acceptance. A union member who confronts a foreman over an alleged contract violation, a regional vice president who wants to make sure her factories get more investment funds, and the director of a research lab who tries to protect his scientists from intrusions from marketing are all engaged in necessarily political relationships. These relationships can be extremely useful to senior managers, because they mobilize the different interests and perspectives that together add up to a comprehensive view of the entire situation.” Quote from L. Hirschhorn and T. Gilmore, “The New Boundaries of

the ‘Boundaryless’ Company, Harvard Business Review, May-June 1992, p. 108

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Taking political action with integrity

• Get past the naive view that “I won’t stoop to politics”– Fundamental factors make organizations political– Being politically adept can help you and your organization– But nevertheless, politics has the scent of self-interest

• Criteria to evaluate political action:A. Does it help you?B. Does it help the organization?C. Is it ethical?D. Does it maintain relationships?

• Take political action with integrity, so you can influence those you depend on and get things done.

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Political conflict is resolvedthrough power and influence

• To be effective in politics, you need power.– We need to expand our view of power

• Power: The currency of politics.– The potential of an individual (or group) to

influence another individual or group – What are types and sources of power?

• Influence: Spending your currency.– The exercise of power to change the behavior,

attitudes, or values of that individual or group.– How do you exercise influence?

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Working Girl (1988)

• Movies often focus on dysfunctional politics, this is no exception. Exceptions: Ryan in Red October; Maggie in Class Action.

• Melanie Griffith is Tess McGill, a secretary on Wall Street. She is trying without success to get onto the management track. When her classy but treacherous boss Catherine (Sigourney Weaver) breaks a leg skiing, Tess steps (literally) into her boss’s shoes – as well as her apartment, corner office, and expensive dresses. Suitably disguised, she forms an alliance with an investment banker (Harrison Ford). Tess has a great acquisition idea for one of Ford’s clients, Trask. The question is whether the deal will catapult her into the big time or finish her off for good. – Power is the potential of one actor to influence another. Where

is power important here? How would you characterize the “type” of power that is important in each case.

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Key Sources of Positional Power:

• Formal Authority: A person’s position in the organizational hierarchy (legitimate, coercive & reward power, in Part 1)– Managers have high formal authority

• Relevance: Being closely aligned with or controlling activities crucial to performance

• Centrality: Occupying central positions in important networks

• Visibility: (Just what it says)

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Key Sources of Personal Power

• Expertise: Task or organizationally relevant competencies (as in part 1)

• Track Record: Demonstrated accomplishments

• Referent: Attributes others find appealing or that they identify with (as in part 1)– Being committed; idealistic; honest– Being beautiful; handsome; famous

• Effort: Leads to perception of commitment and expertise.

Power in Working Girl (notes)

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Example: How power and influence flows

“… when an organization faces a number of lawsuits that threaten its existence, the legal department will gain power and influence over organizational decisions. Somehow other organizational groups will recognize its critical importance and confer upon it a status and power never before enjoyed. This influence may extend beyond handling legal matters and into decisions about product design, advertising, production, and so on. Such extensions undoubtedly would be accompanied by appropriate, or acceptable, verbal justifications. In time, the head of the legal department may become the head of the corporation, just as in times past when the vice president for marketing had become the president when market shares were a worrisome problem, and before him, the chief engineer, who had made the production line run as smooth as silk.”

G.R. Salancik and J. Pfeffer, “Who Gets Power and How They Hold Onto It: A Strategic Contingency Model of Power,” Organizational Dynamics, Winter, 1977, p.4

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Example: Success thru centrality

Assistant BrandManager

Market ResearchManager

Associate BrandManager #2

National SalesManager

Advertising AgencyRepresentative Assistant Brand

Manager

Brand Manager

Associate BrandManager #1

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Example: Success thru centrality

Brand Manager

Assistant BrandManager

Associate BrandManager #1

National SalesManager

Advertising AgencyRepresentative

1. Link to Adv. agency key in selection for spot on new product development task force.

2. Superior presentation impresses senior executive.

3. Executive sponsors entry into fast-track management training program.

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Diagnosing political situations

• Analyze the power dynamics:– Who has the power?

• Sources of power of relevant parties – Who depends on who?

• e.g., Jack is dependent on Tess for …• Analyze goals and interests

– What does each party want?• How will goals and perspectives differ?• What issues will draw conflict?

• Construct a strategy reflecting those analyses

Generic Political Approaches to Increase your Power

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Figure 17.4

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Strategies Examples (type of power involved)

Controlling Uncertainty Reduce uncertainty for others in the firm (expertise; relevance; formal authority)

Being Irreplaceable Develop valuable special knowledge or skills (expertise; track record)

Being in a Central Position

Have decision-making control over the firm’s crucial activities and resources as well as access to key information (formal authority; relevance; centrality)

Generating Resources For example: Recruit key staff; Acquire financing; Close sales; Innovate.

Building Alliances Develop mutually beneficial relations with others inside and outside the organization

Political Approaches for Gaining and Maintaining Power (cont’d)

Generic Political Techniques for Exercising Power

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Figure 17.5

Techniques for Exercising Power

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Strategies

Relying on Objective Information

Providing objective information causes others to feel the manager’s course of action is correct.

Bringing in an Outside Expert

Using an expert’s opinion to lend credibility to manager’s proposal

Controlling the Agenda Influencing which alternatives are considered or even whether a decision is made

Making Everyone a Winner

Making sure that everyone whose support is needed benefits personally from providing that support.

Negotiation

• Negotiation– conflict resolution method in which the parties

consider alternative ways to allocate resources and come up with a solution acceptable to all of them.

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Two approaches to negotiation

Distributive negotiation└ Parties perceive that they have a “fixed pie” of resources that they

need to divide. One’s gain is another’s loss.└ Can lead to a competitive & adversarial stance└ Handled through compromise, competition, or accommodation

Integrative bargaining└ Parties perceive that they might be able to increase the resource pie

through finding a creative solution to the conflict└ View the conflict as a win-win situation - both parties can gain└ Emphasizes a collaborative approach

Integrative bargaining is preferred└ Chance to increase total outcomes & satisfaction with them└ But, it is difficult and may not be applicable in all situation

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Strategies to Encourage Integrative Bargaining

Superordinate goals └ goals that both parties agree to regardless of the

source of their conflict Interests rather than positions (demands)

└ Interests allow exploration of alternatives, whereas positions tend to be fixed

Creating new options Focus on the problem rather than the people Fairness (emphasis on each party reaching goals

rather than dividing the pie)17-48

Negotiation and Third Parties

Third-party negotiator └ An impartial individual with expertise in handling

conflicts and negotiations who helps parties in conflict reach an acceptable solution.

Mediators └ facilitates negotiations but no authority to impose a

solution Arbitrator

└ can impose what he thinks is a fair solution to a conflict that both parties are obligated to abide by

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What do we make of this?(see last slide in lecture notes)

“There is nothing more demoralizing than feeling you have a creative idea or a unique insight into a significant problem and then [coming] face-to-face with your organizational impotence.

This face of power is seen by many …. They are energetic, optimistic, …. They are supremely confident that their “awesome” ability, state-of-the art training, and energy will rocket them up the corporate ladder.

However, many soon become discouraged or embittered. They blame the “old guard” for protecting their turf and not being open to new ideas. Their feelings of frustration prompt many to look for greener pastures of opportunity in other companies – only to be confronted anew with rejection and failure …

These individuals learn quickly that only the naive believe that the best recommendation gets selected, the most capable individual gets the promotion, and the deserving unit gets its fair share of the budget. These are political decisions heavily influenced by the interests of the powerful.”Slides on power and politics adapted from “Power Dynamics in Organizations,” Linda Hill, Harvard Business School note 9-494-083.

Linking exercise with conflict resolution styles

Collaboration: I try to bring all our concerns out in the open so that the issues can be resolved in the best possible way

Accomodation: I go along with the suggestions of my co-workers

Competition: I am firm in pursuing my side of the issue Avoidance: I avoid open discussions of my differences

with coworkers Compromise: I propose a middle ground for breaking

deadlocks

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