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CONFLICT AND NEGOTIATION
After studying this chapter, students should be able to understand the following:
B. Conflict and Negotiation
This lecture takes an in-depth look at conflict management and negotiation, key aspects of contemporary
organizational behavior. After examining the two views of conflict, the consequences of conflict, and the
types and levels of conflict, the chapter discusses culture and conflict, conflict management styles,
organizational sources of conflict, and conflict management strategies. The chapter goes on to explore
Conflict is the process in which one party perceives that its interests are being opposed or negatively
affected by another party. Conflict is a process in which people disagree over significant issues, thereby
creating friction between parties. Conflict can exist when people have opposing interests, perceptions, and
feelings; when those involved recognize the existence of differing points of view; when the disagreement is
ongoing; and when opponents try to prevent each other from accomplishing their goals. Although conflict
can be destructive, it can also be beneficial when used as a source of renewal and creativity. Competition,
rivalry between individuals or groups over an outcome that both seek, is not the same as conflict. In
competition, there must be a winner and a loser; with conflict, people can cooperate so that no one wins or
Organizational conflict occurs when a stakeholder group pursues its interests at the expense of other
stakeholders. Given the different goals of stakeholders, organizational conflict is inevitable. Conflict is Suze orman action plan.
associated with negative images, such as unions getting angry and violent, but some conflict can improve
effectiveness. When conflict passes a certain point, it hurts an organization.
I. Transitions in Conflict Thought
Under traditional view conflict is a process in which
people disagree over significant issues, creating friction
between parties. One view of conflict is that it is
dysfunctional and harmful to organizations, because the
struggle over incompatible goals is a waste of time that
prevents people and organizations from being
productive and reaching their potential. On the other
hand, interactionist view states that when conflict is
based on issues rather than personalities, it can enhance
problem solving and creativity. Open discussions of
differing viewpoints allows for a thorough consideration
of alternatives and their consequences in the course of
decision making. Conflict can also increase motivation
and energize people to focus on a task. Human relation
view states that Conflict is a natural occurrence and we should accept conflict
II. Conflict Good or Bad
Conflict can have both positive and negative consequences. On the positive side, conflict can bring energy
to a competition and focus participants on the task at hand. It can also increase group cohesion and
stimulate open discussion of issues. On the negative side, conflict can cause participants to lose sight of
common goals and focus on winning at all costs. In addition, it can lead to distorted judgments and a lack
of cooperation. Finally, the losers in a conflict feel demoralized and lose motivation; this loser effect harms
long-term relationships and overall organizational performance.
III. How can conflict improve effectiveness?
Conflict can overcome inertia and introduce change, because conflict requires an organization to reassess its
views. Different views are considered, and the quality of decision-making is improved.
IV. Types and levels of Conflict
There are four types of conflict. Inter-group conflict
occurs when groups within and outside the
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organization disagree on various issues.
Interpersonal conflict is due to differences in goals,
values, and styles between two or more people who are
required to interact. Intra group conflict occurs
within a work group over goals and work
procedures. Intrapersonal conflict is a person's
internal conflict over divergent goals, values, or
roles. Inter group conflict can occur at two levels
which are horizontal and vertical. Horizontal
conflict takes place between departments or groups at
the same level of the organization. In contrast,
vertical conflict occurs between groups at different levels of the organization.
Types of Conflict
Task conflict: Conflicts over content and goals of the work
Relationship conflict: Conflict based on interpersonal relationships
Process conflict: Conflict over how work get done
V. Individual Conflict Management Styles
a. The obliging style of conflict management is based on low concern for self, high
concern for others, and
focusing on the needs of
others while satisfying or
ignoring personal needs.
This works best when
issues are unimportant,
knowledge is limited,
there is long-term give
and take, and the person
managing the conflict
has no power.
b. The avoiding style is
based on low concern
for self and others and a
focus on suppressing,
setting aside, and ignoring the issues. This is appropriate when the conflict is too strong
and parties need to cool off.
c. The integrative style shows high concern for self and for others and focuses on
collaboration, openness, and exchange of information. This is used when issues are
complex, when commitment is needed, when dealing with strategic issues, and when longterm
solutions are required.
d. The dominating style shows high concern for self, low concern for others, and focuses
on advancing own goals at any cost. This is used when time is short, issues are trivial, all
solutions are unpopular, and an issue is important to the party resolving the conflict.
e. The compromising style shows moderate concern for self and others and focuses on
achieving a reasonable middle ground where all parties win. This is used when goals are
clearly incompatible, parties have equal power, and a quick solution is needed.
VI. Manager’s ways to manage conflict.
Managers can manage conflict by either preventing or reducing high levels of conflict or stimulating low
levels of conflict. To do this, managers can apply a behavioral approach or an attitudinal approach. The
behavioral approach targets the behavior causing the conflict, while the attitudinal approach targets the
roots of the conflict, including people's emotions, beliefs, and behaviors. Behavioral methods include
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enforcing rules, separating the parties, clarifying tasks, having a common enemy or outside competition, and
increasing resources and rewarding cooperation. Attitudinal methods include having a common enemy,
rotating members, increasing resources, and team-building and organizational development (OD). To
stimulate conflict, managers can introduce change, increase task ambiguity, or create interdependency.
B. Conflict and Negotiation
Stakeholders compete for the resources that an organization produces. Shareholders want dividends,
employees want raises. An organization must manage both cooperation and competition among
stakeholders to grow and survive. All stakeholders have a common goal of organizational survival, but not
all goals are identical.
It is the process used by two or more parties to reach a mutually agreeable arrangement to exchange goods
and services. Managers need negotiating skills to be effective in today's global, diverse, dynamic, teamoriented
business environment. Culture significantly affects the negotiation process. Negotiators from
masculine cultures emphasize assertiveness and independence, which can cause them to see negotiation as a
competition and spur them to win at all costs. Negotiators from cultures comfortable with uncertainty will
take a creative, problem-solving approach, while those from high uncertainty-avoidance cultures will
emphasize bureaucratic rules and procedures. Power-distance, individuality-collectivism, high or low
context, emotion, and time-orientation dimensions also affect negotiation.
Beyond a certain point, conflict hurts the organization and causes decline. Managers spend time bargaining,
rather than making decisions. An organization in decline cannot afford to spend time on decision-making,
because it needs a quick response to recover its position. Group’s battle for their interests, no agreement is
reached, and the organization floats along, falling prey to inertia.
Bargaining issues in negotiation process can be divided into three categories: mandatory, permissive, and
o Mandatory Bargaining Issues—Fall within the definition of wages, hours, and other
terms and conditions of employment.
o Permissive Bargaining Issues—May be raised, but neither side may insist that they be
o Prohibited Bargaining Issues—Are statutorily outlawed.
o Negotiation Strategies
Figure shows four negotiating strategies based on the importance of the substantive outcome and the
importance of the relationship outcome. These four strategies are trusting collaboration, firm competition,
open subordination, and active
collaboration is a win-win
strategy most appropriate when
both the substantive task
outcome and the relationship
outcome are important. Firm
competition is used when the
substantive task outcome is
important but the relationship
outcome is not. Open
subordination is applied when
the task outcome is not
important but the relationship
outcome is. Active avoidance is
useful when neither the task
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outcome nor the relationship
outcome is important.
When two parties are unable to
come to agreement during
negotiations, they may bring in a
third party to help resolve the differences. Conciliation and consultation focus on improving interpersonal
relations to foster constructive discussion of issues. Mediation considers both interpersonal and substantive
issues and relies on formal evaluation of positions plus persuasion to bring about a non-binding solution.
Arbitration, a legally binding process in which the arbitrator imposes a solution, can be used when all other
methods have failed and the conflict must be urgently resolved.
Common mistakes made when negotiating include:
Irrational escalation of commitment; thinking the pie is fixed; winner's curse; and overconfidence. Avoiding
these common mistakes requires managers to be aware of the issues, be thoroughly prepared, and be willing
to rely on expert opinion to reduce the possibility of making mistakes.
Conflict Conflict is the process in which one party perceives that its interests are
being opposed or negatively affected by another party.
Task conflict Conflicts over content and goals of the work
Relationship conflict Conflict based on interpersonal relationships
Process conflict Conflict over how work get done
Vertical conflict It occurs between groups at different levels of the organization.
Horizontal conflict It takes place between departments or groups at the same level of the
Negotiation It is the process used by two or more parties to reach a mutually agreeable
arrangement to exchange goods and services.