1. 16Chapter PowerPoint Presentation by Charlie Cook © Copyright The McGraw-Hill Companies, Inc., 2003. All rights reserved. Organizational Conflict, Negotiation, Politics, and Change

2. © Copyright McGraw-Hill. All rights reserved.16–2 Learning Objectives After studying the chapter, you should be able to:After studying the chapter, you should be able to:  Explain why conflict arises, and identify the types and sources of conflict in organizations.  Describe conflict management strategies that managers can use to resolve conflict effectively.  Describe negotiation strategies that managers can use to resolve conflict through integrative bargaining.  Explain why managers need to be attuned to organizational politics, and describe the political strategies that manager can use to become politically skilled.

3. © Copyright McGraw-Hill. All rights reserved.16–3 Learning Objectives (cont’d)  Identify the main steps in the organizational change process.

4. © Copyright McGraw-Hill. All rights reserved.16–4 Chapter Outline Organizational ConflictOrganizational Conflict  Types of Conflict  Sources of Conflict  Conflict Management Strategies  Negotiation Strategies for Integrative Bargaining Organizational PoliticsOrganizational Politics  The Importance of Organizational Politics  Political Strategies for Increasing Power  Political Strategies for Exercising Power

5. © Copyright McGraw-Hill. All rights reserved.16–5 Chapter Outline (cont’d) Managing Organizational ChangeManaging Organizational Change  Assessing the Need for Change  Deciding on the Change to Make  Implementing the Change  Evaluating the Change

6. © Copyright McGraw-Hill. All rights reserved.16–6 Organizational Conflict Organizational ConflictOrganizational Conflict  The discord that arises when goals, interests or values 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 the different stakeholder in the organization. Lack of conflict signals that management emphasizes conformity and stifles innovation.Lack of conflict signals that management emphasizes conformity and stifles innovation. Conflict is good for organizational performance although excessive conflict causes managers to spend too much time achieving their own ends.Conflict is good for organizational performance although excessive conflict causes managers to spend too much time achieving their own ends.

7. © Copyright McGraw-Hill. All rights reserved.16–7 The Effect of Conflict on Organization Performance Figure 16.1

8. © Copyright McGraw-Hill. All rights reserved.16–8 Types of Conflict Interpersonal ConflictInterpersonal Conflict  Conflict between individuals due to differences in their goals or values.  Intragroup Conflict Conflict within a group or team.Conflict within a group or team.  Intergroup Conflict Conflict between two or more teams or groups.Conflict between two or more teams or groups. Managers play a key role in resolution of this conflictManagers play a key role in resolution of this conflict  Interorganizational Conflict Conflict that arises across organizations.Conflict that arises across organizations.

9. © Copyright McGraw-Hill. All rights reserved.16–9 Types of Conflict Figure 16.2

10. © Copyright McGraw-Hill. All rights reserved.16–10 Sources of Conflict Incompatible Goals and Time HorizonsIncompatible Goals and Time Horizons  Different groups have differing goals and focus. Overlapping AuthorityOverlapping Authority  Two or more managers claim authority for the same activities which leads to conflict between the managers and workers. Task InterdependenciesTask 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.

11. © Copyright McGraw-Hill. All rights reserved.16–11 Sources of Conflict Incompatible Evaluation or Reward SystemsIncompatible 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. Scarce ResourcesScarce Resources  Managers can come into conflict over the allocation of scare resources. Status InconsistenciesStatus Inconsistencies  Some individuals and groups have a higher organizational status than others, leading to conflict with lower status groups.

12. © Copyright McGraw-Hill. All rights reserved.16–12 Sources of Conflict Figure 16.3

13. © Copyright McGraw-Hill. All rights reserved.16–13 Conflict Management Strategies Functional Conflict ResolutionFunctional Conflict Resolution  Handling conflict by compromise or collaboration between parties. Compromise: each party is concerned about their goal accomplishment and is willing to engage in give- and-take exchange to reach a reasonable solution.Compromise: each party is concerned about their goal accomplishment and is willing to engage in give- and-take exchange to reach a reasonable solution. Collaboration: parties try to handle the conflict without making concessions by coming up with a new way to resolve their differences that leaves them both better off.Collaboration: parties try to handle the conflict without making concessions by coming up with a new way to resolve their differences that leaves them both better off.  Managers also must address individual sources of conflict.

14. © Copyright McGraw-Hill. All rights reserved.16–14 Conflict Management Strategies (cont’d)

15. © Copyright McGraw-Hill. All rights reserved.16–15 Conflict Management Strategies (cont’d)

16. © Copyright McGraw-Hill. All rights reserved.16–16 Negotiation Strategies for Integrative Bargaining NegotiationNegotiation  A method of conflict resolution in which two when parties of equal power try to find an acceptable solution by considering various alternatives to allocate resources to each other.  Distributive negotiation The parties see the conflict as win-or-lose because they believe the resource base of the conflict is fixed.The parties see the conflict as win-or-lose because they believe the resource base of the conflict is fixed.  Integrative negotiation Parties can increase total resources by coming up with a new solution that is a win-win for both.Parties can increase total resources by coming up with a new solution that is a win-win for both.

17. © Copyright McGraw-Hill. All rights reserved.16–17 Negotiation Strategies for Integrative Bargaining

18. © Copyright McGraw-Hill. All rights reserved.16–18 Organizational Politics Organizational PoliticsOrganizational Politics  The activities managers engage in to increase their power and use it to achieve their goals or overcome resistance or opposition. Political strategiesPolitical strategies  Specific tactics used to increase power and use it effectively to influence and gain the support of other people while overcoming resistance

19. © Copyright McGraw-Hill. All rights reserved.16–19 The Importance of Organizational Politics PoliticsPolitics  Can be viewed negatively when managers act in self-interested ways for their own benefit.  Is also a positive force that can bring about needed change when political activity allows a manager to gain support for needed changes that will advance the organization.

20. © Copyright McGraw-Hill. All rights reserved.16–20 Political Strategies for Increasing Power Figure 16.4

21. © Copyright McGraw-Hill. All rights reserved.16–21 Political Strategies for Increasing Power

22. © Copyright McGraw-Hill. All rights reserved.16–22 Strategies for Exercising Power Figure 16.5

23. © Copyright McGraw-Hill. All rights reserved.16–23 Strategies for Exercising Power

24. © Copyright McGraw-Hill. All rights reserved.16–24 Relationship Between Organizational Conflict, Politics, and Change Figure 16.6

25. © Copyright McGraw-Hill. All rights reserved.16–25 Managing Organizational Change Assessing the Need for ChangeAssessing the Need for Change  Recognizing that a problem exists and find its source by looking inside and outside the firm. Deciding on the change to make: determine the ideal future state.Deciding on the change to make: determine the ideal future state.  Decide what the future company will look like and what needs to be changed to get there. Implement the changeImplement the change  A top-down change is quickest, while bottom-up change approach is more gradual but more effective at eliminating obstacles.

26. © Copyright McGraw-Hill. All rights reserved.16–26 Managing Organizational Change Evaluate the ChangeEvaluate the Change  Compare pre-change performance with post-change performance  Benchmark your change to other firms in similar situations.

27. © Copyright McGraw-Hill. All rights reserved.16–27 Steps in the Organizational Change Process Figure 16.7