The Effect of Workplace Conflicts on Productivity - Essay Example

The effect of workplace conflicts on productivity Karl Marx, a renowned theorists and economist, in one of his famous theories, Conflict theory, depicted that in a social production setting, social worker uncontrollably get involved in definite relations, whose totality of production constitute societal and organizational economic structure (Bartos and Wehr, 2002:2). Arguably therefore, conflicts are bound to happen resulting from the relations. Assertively, for decades, workplace conflicts have existed despite the endeavour to create a balance between employers and employees. Scholars believe that the main cause of the many conflicts experienced in work place it lack of proper understanding of labour. Labour is one of the crucial factors of production, providing the necessary link between the raw materials, other factors of production, and the final products, their distribution and delivery to the final consumer. In simple terms, labour, otherwise known as workforce, comprises of all the various players including employees, their employers, managers, self-employed people, and in a sense, the unemployed population capable of providing labour (Reddy, 2004: 27). Though different perspectives have been taken, the argument that conflict in the workplace, in any of its forms, is not an important barrier to productivity nor is it an interesting topic for economic theory can be challenged. In several dimensions, work place conflicts have become normalities and facts of life. Diversity of opinions, which results from increasing labour in a workplace setting has contributed to different goals and objectives, which conflict in one way or the other. It can be argued from theoretical perspective that though perceived negatively, conflicts in workplace are not at all times a negative thing. For as long as resolutions are effectively executed, chances of both personal and professional growth in the organization within which the conflicts exist can be promoted. However, management failure and evident reduced productivity have become the most common outcomes once an organization is faced by conflicts (Gramberg, 2006:68). Many of the factors that cause these conflicts are developed from within the organization. Through publications, several factors have been noted as the core contributors of workplace conflicts. For instance, poor wages by employees contributes immensely to these conflicts. Although workers have given their time and labor to contribute to the organizations’ progress, their efforts have not been reciprocated. As a result, they do not feel motivated. Though scholars believe that the result of reduced motivation is reduced output, which consequently reduce productivity (Maravelas, 2008:14), the magnitude of the reduced productivity is not in any way negligible hence considered a factor to reduced productivity. Another factor contributing to workplace conflicts and believed to lower productivity is poor working condition. Companies that have recorded continuous growth from time to time have evidenced excellent working conditions, which include insurance and medical cover for all workers. When this covers are provided, workers feel part of the company or organization and feel protected at the same time hence productivity increases through increased individual output (Maravelas, 2008:69). Within organizations, bullying has taken place where by some individuals are considered less than others are. This trend still occurs during making of decision affecting the organizations. Whereby theorists advocate that all workers are involved in the process of decision-making, this is not the case. Management makes all the decisions on behalf of other people in the organization, including the decisions that affect the employees. Such a state is a form of bullying hence workers feel that they have been considered inferior and as a result relax in their work hence due to conflicts that result as they fight for their rights. This eventually leads to reduced productivity (Blanchard and Philippon, 2004:43). Another level of workplace conflicts, which lies in working condition, involves the regulating bodies and the industrialists. The regulating bodies exert authority to influence the activities of employees, especially the working conditions and safety of workers. In the short term, these statutory controls may appear to impact negatively on production. From another perspective, in the long run, this might lead to improved productivity in the end since workers will workers will not be given the chance to decide what is good for them, but respect what has been decided (Sally, 2009:65). However, the management must understand the significance of listening to workers ideas to better their working conditions since by improving the working conditions, and setting the minimal requirements on the part of employers, the role of the social welfare mechanisms like employee associations and trade unions becomes vividly limited. This means that employers will enjoy tension free working relations with their employees, as long as they play by the provisions of such statutory mechanisms (Doherty and Guyler, 2008:13). The different market structures contribute to conflicts differently. For instance, a perfect competition market structure is less likely to contribute to conflicts since both entry into, and exit out of the market is on will. The competition is high hence; every party is involved in the process of decision-making. On the other hand, monopoly competition provides for one firm in an industry providing a product (Maravelas, 2008:147). In such a structure, conflicts are likely to occur since the firm in the only provider of a product that is a-must-use. Due to this state of monopoly, decision on prices, wages and any other are decided by the management thus no individual is given the opportunity to raise their issues. In such, strikes have been in the increase as employers fight for their rights, issue that have led to reduced productivity. Although employee’s unions support for the strikes by workers, Addison and Teixeira (2006:12) believe that productivity is affected when workers go for strike. Although at some point, the authors argue that strikes are have a positive association to unemployment, in page 6 they depict that real wage is a factor to consider in the economy since it grows in line with productivity. With the increasing number of conflicts, economic theories have been brought forth, which seek to highlight the possible causes and suggest possible solution to these problems. One of the theories, which attempt to explain these conflicts, is the Nash Equilibrium. As a concept of game theory, John Nash in his theory bases his argument on the optimal results whereby out of the many players, none of the many players in the game benefits by deviating from their own strategies after putting into consideration their opponent’s ideas. The same is the case in a workplace setting where opinions are numerous and contradicting. As a result of the many ideas, different opinions make it hard to make a choice out of the many hence the wrong choice might be made. Since the theory gives several conditions, some of them are not met, while others are partially met (Simpson, 2006:307). The theory states that once these conditions are not met, chances of conflicts are very high. The other common theory used by economists to explain workplace conflict is the game theory. The theory starts by acknowledging the fact that conflict serves as a driver among the many drivers for progressive performance of a team. The theorists believes that if conflict is properly managed, it could lead to positive results especially increased output. However, according to the theory, managements have failed to understand and see the positive side of the conflict thus managing arising conflicts imperfectly (Simpson, 2006:312). The obvious result is mismanaged teamwork and hindrance from organizational goal realization. The Hicks-Zeuthen Bargaining model is another economic theory, which seeks to explain the workplace misunderstandings. Although other theorists consider it to have many uncertainties, the theory gives emphasis on outcome of every economic activity. From the theory, personal elements common in workplace are responsible for the many conflicts occurring (Comay, Melnik, and Subotnik, 2001:306). The theory believes that these misunderstandings should be solved through negotiations. To the contrary, those responsible for the solutions lack the skills necessary to making the negotiations a success. All in all, according to the theory, it is arguable that any misunderstanding within any organization or company should be solved through recognized skills and psychology of negotiation without any threats. Most recently, the existence of employee rights, enforceable through various state mechanisms is a sure record of the extent of state involvement in employment relations across the globe. Through this, the issue of conflicting interests in the work places is not only a preserve of employees and their employers, but governments as well have a critical role in initiating or resolving conflicts. Issues that touch on health and safety, minimum wages, working conditions, and the rights of employees are part of the legal system in many states across the globe. These have been a major cause of conflicts between the employers and their employees, with the government coming in to help in the legal determination of the rights of each party, and ultimately resolving such conflicts (George, 2007: 109). There are several ways of determining the progress of an organization and success realized. However, organization’s output determined through productivity is inevitably significant (Psychometrics Canada Ltd., 2009:11). Therefore, the question of how such conflicts affect the productivity of firms and industries is of great interest to scholars and theorist. In fact, irrespective of the success, when an organization is faced by conflicts possibly resulting to strikes draws the attention of media and the public. To many, judgement is that the organization is failing. According to a study by Blanchard and Philippon (2004), despite the many factors behind conflicts, the effect of wages, taxation and the quality of labour are some of the issues around which conflicts are manifested in industrial relations and whose impact cannot be easily determined. When workers in any firm are dissatisfied with the terms of service, the productivity levels go down, as a sort of go slow on the job develops. However, there is still no consensus as to the extent to which such activities affect productivity on cumulative basis. Irrespective of the rate at which conflicts affect production in an organization, efforts to realize effective resolution are inevitable. Reitor (2009:31) believes that when organization through its management endeavours to realize effective conflict resolution, the many problem the conflict has brought to the surface can be solved as well. This eventually would lead to unexpected benefits. For instance, successful conflict resolution leads to increased understanding. When employers and employees get involved in a discussion in efforts to solve a certain conflict, every involved member is informed and gets aware of the situation. The positive result of this is an insight of how each can realize his/her goal without undermining the goals set by other parties. In addition, the group cohesion is increased. This is realized through the mutual respect developed once the conflict is solved, which renews their faith in work increasing chances of high productivity. Further still, individual’s self-knowledge is increased (Gramberg, 2006:71). When conflicts occur in an organization, the individuals are pushed to re-examine their goals, which helps them prioritize as they consider the goals the organization they work for has set and focused to realize. In conclusion, the effect of workplace conflicts on productivity is clearly an issue of concern for all players in the production process. However, in a strange twist of events, the effect of conflicts might lead to discussion, which in the long run will benefit the organization catering for the lost realized during the conflicts. The underlying argument is that such conflicts lead to an improvement of the issues causing the conflicts, like working condition, which is a requisite requirement for the development of quality work delivery. Therefore, at the end of these conflicts, the employers stand to gain from improved quality of work, and the reduction of unemployment levels. Further still, the workplace conflicts that have kept management on its toes to ensure that it fulfils its mandate to the employees, while at the same time prompt an enquiry to the best way to ensure optimal utilization of labour (Olivier, Jean, and Denis, 2009:345). In view of these developments, the existence of conflicts in work places is an important determinant of productivity, drawing a particular interest from economic theory. The fact that other factors, other than market forces have a greater influence on the economics of labour is in itself an integral aspect of concern for economic theory world over. Bibliography Addison, T. J. and Teixeira, P., 2006. Does the Quality of Industrial relations Matter for the Macro Economy? A Cross-Country Analysis Using Strikes Data. IZA DP No. 1968. Bartos, J. O. And Wehr, P. E., 2002. Using Conflict Theory. Cambridge: Cambridge University Press. Blanchard, O. & Philippon, T., 2004. The quality of labor relations and unemployment, Issue 10590. London: National Bureau of Economic Research Comay, Y., Melnik, A. and Subotnik, A., 2001. Bargaining, Yield Curves, and Wage Settlements: An Empirical Analysis. Journal of Political Economy, 82(2): pp. 303-313. Doherty, N. and Guyler, M., 2008. The Essential Guide to Workplace Mediation and Conflict Resolution: Rebuilding Working Relationships. London: Kogan Page Publishers. Gramberg, B., 2006. Managing Workplace Conflict: Alternative Dispute Resolution in Australia. London: Federation Press. Maravelas, A., 2008. How to Reduce Workplace Conflict and Stress: How Leaders and Their Employees Can Protect Their Sanity and Productivity from Tension and Turf Wars. New York: ReadHowYouWant.com. Olivier, D., Jean, P., and Denis, C., 2009. The impacts of leadership on workplace conflicts. International Journal of Conflict Management, 20 (4), pp. 340 – 354. Psychometrics Canada Ltd., 2009. Warring Egos, Toxic Individuals, Feeble Leadership. A study of Conflict in the Canadian workplace. Available from: http://www.psychometrics.com/docs/conflictstudy_09.pdf [Accessed 30 April 2012]. Reddy, R., 2004. Economics of Labour. New Delhi: APH Publishing. Reitor, S. K., 2009. Resolve Workplace Conflicts Once and for All: Real Solutions for Real Situations. Bloomington: iUniverse. Sally, N., 2009. Conflict in the Workplace: Part 2. American Journal of Nursing, 109 (7), pp. 65-67. Simpson, W., 2006. Unions, Industrial concentration and wages: re-examination. Applied Economics, 18 (3). pp. 305-317. Read More