Conflict Management Aspects - Essay Example

Conflict Management Affiliation: Conflict Management Introduction Downsizing is the process of laying off workers temporarily or permanently due to business reasons such as market pressure and stiff competition, adoption of advanced technology that phase off manual labor and economic depressions. Laying off workers may result in conflicts especially if the process isn’t well structured. Possible areas of conflict include internal conflicts with employees, external conflicts with stakeholders such as government, local community and clients (Edelman & Lande, 2003). This paper identifies possible areas of conflict with external stakeholders, for a company experiencing downsizing. It evaluates the role of team leadership and the overall effectiveness of teams in preventing and actively managing conflict. Additionally, it assesses the importance of maintaining relationships with stakeholders throughout significant organizational change. Finally, it recommends strategies that the organization can use to prevent and actively manage foreseen and unforeseen conflicts among internal and external stakeholders that may negatively affect the organizations attempt to downsize. The paper asserts that although downsizing could be inevitable and beneficial to the organization, failure to manage perceived and actual conflicts with stakeholders could affect the firm negatively. Potential Conflicts with External Stakeholders Arising from Downsizing Interpersonal conflicts influenced by political factors may arise between the government, the labor unions and the organization. The government makes labor laws that define the procedure and rules on how firms should lay-off employees. For example, labor law prohibit discrimination in the downsizing process and state that employees should be given enough notice and benefits upon termination. If the firm doesn’t observe these rules, it faces conflicts with the government and labor unions that fight for the rights of unionized employees. The firm faces interpersonal conflicts of economic nature with clients, suppliers, creditors if upon downsizing, it is unable to honor its contractual obligations (Ramsbotham & Woodhouse, 2011). For example, the inability to honor debts when they fall due and offer products/services to its clients. Social conflict with the local community may arise from downsizing. Laid-off workers may strain the community’s resources if they are not compensated. They may become stressed and develop psychological problems, making them dependent on the communities. The conflict arises because the society expects the company to take care of the laid-off workers by giving them sufficient send-off benefit packages. Furthermore, it may face legal conflicts with labor unions, the government, non-union employees, suppliers, clients and creditors for different reasons. Suppliers, customers and creditors may sue the firm for failure to honor contractual terms and obligations. This may result from inability to offer promised goods/services to customers, insufficient funds to pay debts when they fall due. The government may sue the organization for failure to observe labor laws in downsizing process. Non-unionized employees may sue the company for unfair practices such as failure to offer termination benefits and discrimination in downsizing. Legal suits may be too costly for the company because it has insufficient funds after losing its key customer to a competition (Konovsky, 2000). Therefore, management must use the win-win conflict resolution strategies to ensure that laid-off employees aren’t disgruntled and that all stakeholders are taken care off. Technological conflict may arise with manufacturers whose contracts to supply technology are terminated due to market competition challenges the firm is experiencing. Environmental conflict arises when the company disposes obsolete carelessly, machines, equipment and other non-biodegradable worn out resources that were used by laid-off workers, causing environmental pollution. Evaluating the Role of Team Leadership and the Overall Effectiveness of Teams in Preventing and Actively Managing Conflict The team leaders/managers paly a big role in using win-win, compromising and smoothing to contain conflict and resolve personal and interpersonal conflicts with stakeholders amicably. For example, win-win conflict resolution strategy is used in giving some compensation benefits to laid-off workers to enable them settle down. Compromise strategies are used with labor unions to discuss the types and amounts of benefits to offer to laid-off workers since the firm is experiencing financial challenges and may not offer all the required benefits. Smoothing strategies are sued on other stakeholders where the leaders listen and address stakeholder needs and fear to avoid unnecessary conflicts (Baillien & De Witte, 2009). The leader is the interface with these groups and must communicate effectively with them, in order to clarify any issues and fears that could result in conflicts. The leaders also come up with a downsizing structure that ensures that the process is free from bias and discrimination especially in picking the employees to lay-off. For example, management may base the process on skills, experience and competence of employees. Employees who fail to meet the set combination of skill and expertise at any caliber of employee is them laid-off. The effectiveness of teams in preventing and managing conflict is highly influenced by how well the team coordinates and cooperates with each other. To achieve this, constant and effective communication is required to ensure that all members receive the right information to avoid confusion, which is a possible cause of conflict. The teams addressed in the above scenario seems to be effective in managing conflict because of their commitment to conflict resolution and desire to have peaceful co-existence in the firm. The team has successfully managed to solve conflicts with management that had earlier strained the relationship between them (Martins & Terblanche, 2003). To achieve this, the team used collaboration strategies to discuss its grievances with management. Through negotiation, the two parties came up with agreement terms that were satisfactory for each side, resulting in improved relations between them. The team was effective in seeking managerial support of employee motivation in order to increase output. Following the formation of the team initiative, the company has foreseen positive growth and attainment of future objectives. Importance of Maintaining Relationships with Stakeholders throughout Significant Organizational Change Maintaining relationships with stakeholders is critical for business continuity after downsizing. For example, suppliers will be needed to supply critical resources and therefore the firm must avoid all areas of conflicts with this group. Maintaining healthy relationships with key customers is critical because they need to support the business by buying goods/products. The company must commit to offering great services after downsizing in order to retain its client base. The survivors of the exercise are charged with the responsibility of reviving the business and achieving new targets (Floyd & Lane, 2000). This group faces emotional anxiety and stress because they are unsure of their future in the organization. The form must address their fear if it expects them to increase their productivity and return the business to its lost glory. The government must be addressed because strained relationships may result in law suits and government restrictions that will further paralyze the firm’s operations. Maintaining healthy relationships with stakeholders protects the image of the organization from being dented. Downsizing activity sends negative information to the market that the firm is incompetent and is heading towards bankruptcy. However, managing the information dispatched to the public could save the firm’s image and reputation from total destruction. Managers must therefore, address all their stakeholders and explain the benefits of downsizing. For example, shareholders value may increase after downsizing because the firm will cut down on unnecessary costs (Karam, 2009). The customers may get higher quality products due to streamlining of the firm’s production process and core operations among others. Efforts to make stakeholders understand the need for downsizing will make them view the exercise positively and therefore circulate positive information about the company. Positive information could increase the firm’s reputation, giving it the leverage it needs to acquire new key customers. Recommended Strategies for Managing Conflicts with Stakeholders To prevent internal conflicts with employees, the company should clear all the channels of communications. This will ensure that employees have ways to address their problems and dissatisfactions that result in resentments. Establishing clear channels of communication also ensures clarity of information to avoid confusion and ambiguity of rules and instructions that result in personal and group conflicts. The company should establish sound structures compensation and career advancement structures, based on merit and competence rather than favoritism and bias. These strategies will clarify key performance indicators, required skills and competence (Callan, 2003). The structures will act as guides to downsizing exercises in laying-off incompetent workers, who are unable to meet the required thresh holds. Because the employees will be aware of their performance, they will expect to be laid-off if their performance is wanting, Communication and establishing healthy relations are key factors to avoid conflicts with external stakeholders. The company should appoint a contact person who regularly communicates with stakeholders such as customers, shareholders, suppliers and the general public. Communication should remain transparent so that they understand the progress of the form especially in dealing with economic problems and challenges. Involving stakeholders in major decisions such as right sizing will ensure that they remain part of the process and understand its benefits, therefore, circulating positive information in the market, and protect its image (Jehn, 2007). Asking stakeholders and employees for feedback will help the firm identify actual and possible conflicts and act on them in time. Preventive measures are more productive and less costly than solving actual conflicts. The company should face its conflicts head-on, rather than use withdrawal strategy to manage conflicts. It should indicate commitment and willingness to address all issues with stakeholders and should never ignore any slight issue because this could initiate a bigger problem with stakeholders. Conclusion Conflict resolution strategies such as collaboration, negotiation, compromise and smoothing can be used to solve actual and perceived conflict that the above organization experiences with stakeholders. The conflicts can take different nature such as legal, political .economic and social. The team leader plays a big critical role in containing conflicts with stakeholders, through regular and transparent communication. Although the company faces economic challenges, proper management of conflicts associated with downsizing will ensure the success of the process and increase operation efficiency and effectiveness. This will cut down on extra costs and streamline core operations, resulting to increased productivity. Proper conflict resolution will protect the firm’s image and give it the leverage it needs to acquire new key customers. References Aquino, K. (2000). Structural and individual determinants of workplace victimization: The effects of hierarchical status and conflict management style.Journal of Management, 26(2), 171-193. Ayoko, O. B., Callan, V. J., & Härtel, C. E. (2003). 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