Conflict Management and Resolution - Case Study Example

Conflict management and resolution A case study of Personal Investment Pty Ltd By Insert Name Subject, Semester Institution Instructor Date EXECUTIVE SUMMARY Conflicts are an integral part of everyday operations within an organization. Conflicts are an inevitable element of life especially where interactions are involved (Rogers et al 201, p940). This is because in the course of inter-personal relationships, differences are likely to occur following the diverse opinions, beliefs and personalities that make up an organization. Conflicts are disagreements and differences in opinion and principle. There are many causes of conflicts. Similarly, there are also many possible solutions to these conflicts. This report seeks to explain the various causes, types and possible solutions to conflicts in the context of Personal Investments Pty Company. The company is a successful business that specializes in investing funds for small institutions. The problem of conflicts arises when the chief executive officer, Mr. Dan Richardson introduces a new senior employee, one Ms. Tabitha Rose who is of the idea that the firm should go for riskier economically viable investments and abandon the current tendency to invest in low risk investments that are safe but have low returns. The resistance she faces from senior partners causes quite some turmoil in the company’s management circles. FINDINGS From the case study, the following findings that will be explained in detail were established concerning the company: Resistance to change This is the tendency to be afraid of change within an organization. Emotion These are feelings that may exist among the members of staff. They vary in nature. There are both positive and negative feelings. Decision making This is the process of selecting from among the many options available to a manager who is entrusted with the duty of determining the direction of the firm. Goal congruence This refers to uniformity in the goals envisioned by the various stakeholders within an organization. There is no congruence where each employee has his or her own goals. Behavioral expectations This refers to the various expectations of managers based on their personalities. For instance, the view of an optimist cannot be the same viewpoint of a pessimist. RECOMMENDATIONS As part of the conflict resolution and accommodation program, the following possible courses of action are recommended: Negotiations These are discussions between the conflicting parties with an aim of coming to a consensus. Effective communication A firm that does not have a strong system of communication within its structures is prone to severe unending conflicts. Interpersonal skills These are the communication and interaction skills within an individual. They may go an extra mile in reducing chances of conflicts. Change management This is an innovative management concept that helps the employees and other top managers accept change in structure. Super ordinate goal This is an objective that either party in the conflict can work towards. Introduction Background of the study This report is based on the case study of Personal Investments Pty Ltd; a company that invests funds for their clients, which are mostly institutions. Established in the year 1960, the company has had loyal clients who seemingly are in favor of the approach that the company adopts when making investments. The company prefers investing in less riskier projects. The company’s Chief Executive Officer, Mr. Dan Richardson who works with the principle of loyalty to clients, friends and the company, identifies an old friend, Ms. Tabitha Rose who possesses an admirable track record. She is a performer and has always been associated with success everywhere she works. Bringing the lady into the company’s management is not easy for Richardson as the other partners are not for the idea of employing Tabitha citing the reason that she has not been able to settle in one firm for long. When she finally gets employed and given some degree of autonomy, she adopts a different perspective and ventures in to riskier investments that come with high returns. The junior and younger employees are in acceptance with Tabitha’s innovative policy. The other members of the management and senior partners are seriously against the idea arguing that their policy is one that regards safety. They mount pressure on Mr. Richardson to ensure that Ms. Tabitha either abides to their policy or resigns. The scope of the study This study focuses on the various sources of disagreements, the types of such conflicts, conflict resolution methods as well as the most effective strategies adopted by various companies in handling and preventing conflicts. This is done in the context of Personal Investment Pty Ltd. The report outlines the most effective strategies. Types of conflict Disagreements can be categorized into five categories depending on the direct causes of the conflicts. The major causes of a disagreement must be identified in the process of categorizing the conflicts. The five types of conflicts are: Conflict of interest Classical management theories have always advocated for subordination of individual interest to organizational interest. Where a person is not able or willing to give up personal desires for the sake of the organization, such a person is said to be entangled in a conflict of interest (Tillett & French 2006, p.43). Selecting between the interest of a person’s instincts and the desires of the shareholders and clients is usually a difficult situation. Resolving conflict of interest is not something that an individual can go about without professional guidance. It therefore means that a person must undergo a type of professional counseling referred to as industrial counseling so as to be in a better position to let go of the individual interests. Data conflict This is a type of conflict that arises out of factual information. This type of conflict is usually associated with wrong interpretation of factual information or lack of adequate data to be used in the decision making process (Osborn 2010, p.54) Where there are inadequate or no facts at all to be relied upon in decision making, people will come up with different proposals. Such proposals may bring about misunderstandings that may turn out to be the most serious conflicts in the organization. Value conflict This is a conflict that occurs when a person is forced to give up their principles, value and beliefs so as to attain a certain goal of an institution (Eunson 2008, p.67). A good example is where an honest person is forced by circumstances or peers into giving up their principles and values of honesty by engaging in corrupt activities so as to achieve a certain level of profitability for the company. In such a type of conflict, the person a person has to weigh various methods of resolution because virtually all conflict resolution methods are applicable here. Structural conflict These are organizational conflicts that arise out of changes in the external environment that prompt further changes in the internal environment (Salami 2010, p.87). These changes are associated with resistance to change. Employees have a tendency to resist change due to various reasons including fear of the unknown and fear of losing jobs. Changes in the systems and structures within an organization can spark serious conflicts. Relationship conflict This is a type of conflict that can be linked to the inefficiencies of interpersonal communication. Interpersonal relationships and communications may bring about conflicts due to the differences in ideas and principles held by the communicating parties (Larusso & Selman, R 2011. Inefficient communication is the cause of this type of conflict. It can easily be resolved by instituting strong communication systems. This type of conflict is associated by extreme negative emotions. The conflict in the report Critical analysis reveals that the conflict in this case study is caused by changes in the organizations way of going about business, that is, the kind of investments it undertakes and how the partners value this approach. The low-risk and low return approach that is upheld by the traditional managers and partners at Personal Investment ltd has been put to challenge by Tabitha, who thinks the aggressive approach of taking high risk high return projects is the way to go in the contemporary business world. After the new manager starts the high risk investment method, the performance of the company improves. The old managers are bitterly against this approach. This is the beginning of the conflict and as such we can conclude that, much as the conflict in the case is linkable to many causes, the most prominent cause is the change in the ways of operation. This is what is referred to as structural change. Roles in the conflict The parties to this conflict are: Tabitha, the senior managers of the old system, the company and Mr. Richardson. According to Mr. Richardson, there are two opposing armies fighting. The first army is Tabitha and the junior employees, who are contented with the approach of the new innovative manager. This army is out to push for change. They are ready for the new approach that is able to boost the return on income of the clients. The second army is that of the old managers and partners who are resisting the new approach. This army is still of the idea that safety should be prioritized. They fail to understand the innovative ideas of Tabitha who is more exposed and experienced in the field. The third party to the conflict is the company itself. Typically, a company is registered under the law of persons. It therefore can be held in conflict. The company is in a conflict with Tabitha since she has come with her new policies that are actually against the company policy. The conflict between the high risk approach and the low risk portfolio is what causes the drift between the corporation and Tabitha. Mr. Richardson is the last party to this conflict. He is not in a position to solve the conflict since Ms. Tabitha is a very close friend of his and at the same time he believes in her philosophy. Again, as a steward and a partner in the company, he feels obliged to protect the policy of a low risk portfolio. Mr. Richardson is in a value and a relationship conflict at the same time. Issues in the conflict In the case of Personal investment ltd, the issues surrounding the conflict are very many. They can be explained briefly as: Resistance to change Logically, this is the biggest cause of conflict in this case. The views of the old managers and partners are not change oriented. Instead, they are rigid on the risk averse attitude that is associated with high safety and low returns. On the contrary, Tabitha is an innovative leader who is ready to challenge the status quo by taking on the risky well paying projects. She replaces these projects with the low risk projects in the company’s portfolio prompting serious turmoil and negative response from her fellow top managers. Resistance to change is usually associated with fear of the unknown. Emotion Emotions are the feelings employed by the people in the organizations as reactions to the actions or words of other people (Hagemann 2012, p.49). Emotions could be positive or negative. In this case, Tabitha’s move attracts both positive and negative feelings. The junior and other younger employees feel happy and contented with the approach that the lady has introduced. The top managers, save for Richardson, are mad and jealous at the performer. Such emotions as anger and jealous are direct causes of conflict. Decision making The fact that Richardson, in the capacity of a manager, cannot decide what is good for the company, stirs more emotion. From the case, it is rather apparent that Mr. Richardson who is the chief executive officer in the company is unable to decide the way forward. He is torn between dismissing his friend Tabitha and getting the other seniors to accept her style of investment. From the case study, the Chief executive is also a cause to the conflict. Goal congruence This refers to uniformity of objective (Melin 2011, p.125). In this particular case, there is conflict of objective. The objective of the old partners is safety and stability as well as client loyalty. The views of Tabitha are not in line with these goals that are risk averse. Instead, she takes the optimist view and holds on to the goal of high return and high risk. This difference also contributes to the conflicts under the case. Behavioral expectations Arguing the case from a behavioral point of view, we realize that Tabitha is generally aggressive and naturally optimistic and independent. As such, she wants to act independently in the organization using her own style. These expectations are shuttered the moment she realizes she cannot independently. Conflict management strategies The above issues can be dealt with in a number of ways including: Negotiations These are talks between the conflicting parties with the aim of coming to a consensus. Negotiations may or may not involve a mediator. The two parties can iron out their differences through dialogue. Decision making and effective communication Decision making and communication go hand in hand. Decisions made within the organization should be effectively communicated to all members of staff (Kaitelidou et al 2012, p.123). From the case study it is clear that Richardson is not the best decision maker. Failure to make and communicate decisions results in conflict. Change management This entails the introduction of a management function that is there to specifically handle the introduction and management of change. Such a department should be made up of change specialists and industrial counselors that should oversee introduction of change. This should work towards ensuring the employees are receptive to change. The most effective course of action In this case and many other cases of the same nature, the most effective course of action is setting a super ordinate goal. This is a goal to which all parties to the conflict work and contributes. In working together to achieve this single goal, goal or objective congruence is achieved. As the employees work together towards achieving the goal, they sort out their differences and learn how to co-exist. Conclusion In conclusion, it is worth noting that conflicts are inevitable at the workplace. They can both be productive and counter-productive. The main types of conflicts are: structural, interest, value, relationship and data conflict. The best solutions to these conflicts are: negotiation, change management, effective communication, and goal congruence. Even so, it is worth noting that the effectiveness of the possible solutions varies from one firm to another. Conflicts have both positive and negative effects on the success of a firm. Much as the conflicts are inevitable, it is important for the management to try and prevent them. References Rogers Et Al 2011, ‘Teaching Operating Room Conflict Management to Surgeons: Clarifying the Optimal Approach. Medical Education. Vol. 45 Issue 9, P939-945. Kaitelidou Et Al 2012, ‘Conflict Management and Job Satisfaction in Paediatric Hospitals in Greece. Journal of Nursing Management. Vol. 20 Issue 4, P571-578. 8 Melin, Molly M 2011, ’the Impacts of State Relationships If, When, And How Conflict Management.’ International Studies Quarterly. Vol. 55 Issue 3, P691-715. Hagemann, B; Stroope, 2012, ‘Sconflict Management.’ T+D. Vol. 66 Issue 7, P58-61 Salami, OS 2010,’An Analysis Of Conflict Resolution Strategies In Pakistani Schools.’ International Journal of Academic Research. Vol. 2 Issue 6, P212-218 Larusso, M; Selman, R 2011, ‘Early Adolescent Health Risk Behaviors, Conflict Resolution Strategies, and School Climate’. Journal of Applied Developmental Psychology. Vol. 32 Issue 6, P354-362 Salami, OS 2010, ‘Conflict Resolution Strategies And Organizational Citizenship Behavior: The Moderating Role Of Trait Emotional Intelligence’. Social Behavior & Personality: An International Journal. Vol. 38 Eunson B, 2008, Communicating In the 21st Century, 2nd Edn, John Wiley & Sons Osborn R, 2010, Organisational Behavior: Core Concepts and Application, 2nd Edn, John Wiley & Sons Australian, Ltd, Milton. Tillett, G & French, B 2006, Resolving Conflict, 3rd Edn, Oxford Press, Melbourne Read More