MASTER OF MANAGEMENT - GADJAH MADA UNIVERSITY

MANAGING CONFLICT
Case of Interpersonal Conflict

A. Pandu Wirawan, Airin Wahyu G., Aysha Omer, Chandra da Cruz, Alex Dupe 5/1/2013

I.

Background

The National Petroleum Authority/Autoridade Nacional do Petrleo (ANP) is a Timor-Leste's body responsible of managing and regulating petroleum activities in the Timor-Leste's exclusive jurisdictional areas and in the Joint Petroleum Development Area (JPDA) in accordance with the Decree Law on the establishment of the ANP, the Timor-Leste Petroleum Activities Law, and the Timor Sea Treaty. ANP was established on the 1st of July 2008 after the Decree Law passed on the 19th of June 2008, currently employs 85 employees with two offices located in Dili, Timor Leste. The ANP function is to implement and supervise compliance with the enacted rules and regulations covering the exploration, development, production, transportation and distribution of petroleum and natural gas resources. It is also tasked to develop a strong petroleum management institution in TimorLeste. Its vision is to be a leading petroleum regulatory authority in the region and a model for institutional development in Timor-Leste.

II.

Problem Statement

There were two problems faced by the company, which happened in the early 2011. The first being rule violation in terms of alcoholic drinks consumption in the office which led to physical fighting among the employees, and the second was rule violation in terms of designated smoking place. 1. Alcoholic Drinks Consumption in the Office At the end of financial year, it is a tradition for the company to hold employees gathering in order to give year-end report about company performance and the achievement reached during the year. The agenda was started with meeting and presentation of the report, fun game and ended with dinner and dancing. The company actually forbade the employees to bring the alcohol during the office activities. However, some employees sneaked their private alcoholic drinks and started drinking after midnight, hence the problem occurred when some employees began to fight each other. This became a big issue in the office and the corporate manager immediately investigated the problem. People from Human Resources (HR) and Health and Safety (H&S) Department were requested to be involved in the investigation to investigate the suspects There were several questions asked to one of the involving investigators through telephone interview, as follows: Name Position Role : : : Fatima Abdad Human Resources Officer at ANP Investigator in managing the conflict

a.

What was the main issue (root) of the conflict? Answer The main issue was the employees after midnight starts to drink alcohol and get drunk around 1am and they start to fight each other.
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b.

Who were involved in the conflict? Answer The fighting involved some staffs from several departments and few company drivers.

c.

Have you ever experienced organizational conflict? Answer This was my first time involved in organizational conflict and I managed it very well. Our investigator team was successfully solved the problem and apply the company policy to the people who involved in the fighting by given them warning letter and some penalties apply to them.

d.

What was your role in managing that particular conflict? Answer I am acting as investigator and since I am a human resources officer, so I was authorized by the corporate manager to send them warning letter.

e.

How did it solved? Answer It was a good investigation and my team investigator was successfully solved the problem. Also people who involved at the fighting were very corporative. So it was easy for the team to solve the problem.

2.

Smoking in Non-designated Smoking Area The H&S department was always dealing with the issues related to employees health and safety in the company. So, the company provided several designated smoking area for people who want to smoke. However, some employees broke the rule by smoking in the non-designated places, which disturbed other employees and might cause some negative impacts to other employees health. Feeling disturbed, these other employees reported to the H&S department, not just because the irresponsible smokers violated the company rule, but they were also involved in other negative behavior of 3

swearing each other. The H&S officer s were required by the head of the company to manage the conflict.

The following was the telephone interview done with one of the investigators: Name Position Role 1. : : : Zelio Moniz Health and Safety Officer at ANP Investigator in managing the conflict

What was the main issue (root) of the conflict? Answer Some male employees did smoking in public places and disturb other employees who were not smoking. So, they were involved in fighting and swearing each other.

2.

Who were involved in the conflict? Answer It was a conflict between staffs from Administration Department and staffs from Information Technology (IT) Department.

3.

Have you ever experienced organizational conflict? Answer Yes, many times and most of the cases were successfully managed well at the end.

4.

What is your role in managing that particular conflict? Answer Acting as H&S officer

5.

How did it solved? Answer It was successfully good.

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III.
1. Conflict

Analysis

A. Theories Related to the Organizations Problem

Conflict is a process in which one party perceives that is interests are being opposed or negatively affected by another party1. There are two distinctions of conflict, functional conflict and dysfunctional conflict2. Functional conflict serves organizations interest, support the goal of the organization and improve performance. This kind of conflict is commonly referred to in management circles as constructive or cooperative conflict. Dysfunctional conflict,in the other hand, threatens organizations interests, hinder organizational performance.This particular conflict is undesirable and manager should seek for its eradication.

Frederick W. Taylor, writer of efficiency and scientific management, believed that all conflict ultimately threatened management authority and thus had to be avoided or quickly resolved. Too much conflict (particularly dysfunctional conflict) in the organization can erode organization performance because political infighting, dissatisfaction, lack of teamwork, and turnover. Workplace aggression and violence can be manifestations of excessive conflict. Otherwise, too little conflict (particularly functional conflict) also brings negative impacts for organization such as lack of creativity, indecision, and missed deadlines.

1JA

Wald Jr and RR Callister Conclict and Its Management, Journal of Management No.3 (1995), p517.

R Kreitner an A Kinicki, Organizational Behavior, 9th Edition, McGraw Hill, 2011, p 375.

Relationship between conflict intensity and outcomes3

2. Types of Conflict
People avoided conflict for many varieties of bad and good reasons. Some people said that they avoided conflict because they fear various combinations of harm, rejection, lost of relationship, anger, been seen as selfish and so on. The followings are types of conflict one can find in the organization (Kreitner and Kinicki, 2011): a. Personality conflict, interpersonal opposition driven by personal dislike or disagreement. Its occurs when two or more people find themselves in conflict not over a particular issue or incident but due to fundamental incompatible in their responsibilities and their approaches to things their life style of life. b. c. Intergroup conflict, conflict that occurs among work groups, teams, and department is a common threat to organizational competitiveness. Cross cultural conflict, conflict that occurs between people from different countries with different cultures. When doing business with people from different culture is commonplace in our global economy where cross borders merger, joint ventures and alliance are the order of the day. Because of the different behavior on how to think and act, the potential for cross culture conflict is both immediate and huge. Success or failure when conducting business across culture often hinges on avoiding and minimizing actual or perceived conflict.

LD Brown, Managing Conflict at Organizatioanl Interfaces, 1 Edition, Pearson, 1983.

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3. Managing Conflict
It is important to manage the conflict, by involve in doing things to limit the negative aspects of conflict and to increase the positive aspects of conflict. The aim of conflict management is to enhance learning and group outcomes, including effectiveness or performance in organizational setting (Rahim, 2002, p. 208). Properly managed conflict can improve group outcomes (Alpert, Osvaldo, & Law, 2000; Booker & Jame son, 2001; Rahim & Bono ma, 1979; Kuhn & Poole, 2000; Church & Marks, 2001). Vanessa Cross4 wrote in her article, there are five common approaches we may use to resolve conflict, which are: a. Accommodating The accommodating approach emphasizes cooperation instead of assertiveness. A person places his interests last and allows the other party to further her interests. The accommodating approach often occurs when a party is not significantly invested in securing a victory, because he does not perceive the alternative option as a significant threat. b. Avoiding Avoiding conflict involves one of the conflicted parties avoiding communicating about or confronting the problem, hoping it will go away. By not participating in the problem-solving process, she is effectively removing herself from it. When employing this approach, the conflict might go away if the other party doesn't press for a resolution. The underlying differences between the parties are never resolved. c. Collaborating The collaboration style involves parties working together to resolve issues, and both sides come to the table with win-win attitudes. It is a favorable negotiation style in formal dispute resolution situations, such as mediation, where the parties employee a mediator but must agree on the final, binding resolution.

Cross, Vanessa (n.d.). Five Approaches to Conflict Resolution. Retrieved 28 May 2013, from http://smallbusiness.chron.com/five-approaches-conflict-resolution-21360.html

d.

Compromise Bargaining is the hallmark of the compromise approach to conflict resolution. The conflicting parties can identify some interests they are willing to compromise on to bring about a resolution. While the emotional level might still be high, the compromise style sometimes results in interim solutions when a full resolution is not immediately possible. Parties might reach a settlement to prevent further escalation of the conflict.

e.

Confrontation The confrontation style to conflict resolution entails the party placing his desires above those of all others involved in the conflict. Assertiveness is the hallmark of this approach, and those employing this style of negotiation aim to address the conflict head-on. It might involve high levels of emotions as the parties establish positions in what can sometimes evolve into hostile communications.

Another approach that can be used to resolve conflict is called Alternative Dispute Resolution (ADR), which consists of the following techniques (Kreitner / Kinicki, 2011): a. Facilitation, where a third party in higher position can act to urge the conflicting parties to deal directly with each other. b. Conciliation, a neutral third party informally acts as a communication conduit between disputing parties. c. Peer review, review based on a panel of trustworthy coworkers to act objectively and listen to both sides of a dispute in an informal confidential meeting. d. Ombudsman, similar with facilitation, however the facilitator is not in higher position but an employee who is widely respected, especially by both disputing parties. e. Mediation, a neutral third party who is trained, able to resolve the conflict and create innovative solutions.

f.

Arbitration, a use of formal court-like meeting with neutral arbitrator as a decision maker. The decision in arbitration is final and binding. Others prevent conflict at the workplacein which you, as manager, can

minimise those conflict triggers that could have a negative impact on your company. Some of these include: a. Make wise appointments. Make sure that when you hire a new employee, the person fits in with the rest of the team. It might be a good idea to involve a few of the other team members, who will work directly with the new employee, in the selection process.

b. Open communication. Clear, regular communication is the key to strong

working relationships at the office. It's important for managers to be accessible, so that employees can voice their concerns as soon as they arise.

c. Be fair. Make sure work and work hours are distributed evenly. Don't let certain
employees get away with doing less than others this will no doubt lead to conflict. Also try to keep your employees busy. This way, they'll have less time for gossip and squabbles.

d. Involve employees in conflict resolution training. Invest in training that will

teach everyone conflict-resolution skills, and expect people to use them.

e. Set strategies in place. Implement a grievance policy and procedure. Conflict can
be passed up the hierarchy to a common superior for resolution. This way, management will stay on top of potentially volatile situations.

f. Ensure clear guidelines. Establish clear guidelines for dealing with potential
conflict triggers, such as sexual harassment or racial bias. Communicate these guidelines clearly the moment you appoint new employees.

g. Set common goals. Focus on tasks, not personalities, and make sure employees
work together towards common goals. Make sure that employees are rewarded when targets are reached.

4. Alternative Style for Handling Dysfunctional Conflict People tend to handle negative conflict in patterned ways referred to as styles. Several conflict styles have been categorized over the years. According to conflict specialist, Rahim offer a model of conflict-hadling styles5, five different conflict-handling styles can be plotted on a 2*2 grid. High to low concern for self is found on the horizontal axis, while low to high concern for others form the vertical axis. Various combinations of these variables produce the five different conflict-handling styles such as: integrating, obligating, dominating, avoiding, and compromising. There is no single best style; each has strengths and limitations and subject to situational check.

5MA

Rahim, A Strategy for Managing Conflict in Complex Organizations, Human Relations Journal, January 1985, p 84.

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5. The role of Organizational Culture Corporate culture can be defined as the specific elements that explain the basics of how an organization works. Corporate culture, sometimes called organizational culture can be defined as the set of rules of an organization, shared values, how they should be conveyed, and the common way of approaching problems. They may be included in a charter. The components of corporate culture are numerous: Company History Rites Symbols Values (implicit or explicit) Working methods Socio-cultural habits The company values can be as varied: Ethics Team Spirit Justice Honesty Professionalism Cohesiveness

How to build a corporate culture? A company that wants to structure and formalize their culture will often use an external expert. This will create a small group of members of the organization, and cross each of the components mentioned above. Loyalty to the corporate culture is a long-term process and will necessarily (under penalty of failure) through the involvement of all stakeholders, whether officers or employees of the company. However, the corporate culture is not just a source of cohesion, it also brings an essential contribution to the technical operations. Corporate culture contributes significantly to standardize these behaviors and contingencies. Giving everyone a common reference, the corporate culture can be recalled to prevent or ease tensions within the company. To define the corporate culture that we study, we can use CVF framework (competing values framework) created initially by Quinn and Rohrbaugh in 1983 and rehabilitated by Cameron and Quinn in 2006. There are four types of cultures:

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B. Discussion on Organizations Problem

According to the conflict definition, two conflicts occurred in ANP are both dysfunctional conflict. Alcoholic drinks consumption in the office and smoke in nondesignated smoke are surely could bring negative impact on employee working relationships because it disturb comfortable existing working condition. It also violates company culture as well as company regulation. Management of ANP should impose penalty to their employee that conducted these negative kind of behavior. Moreover, ANP is a state company, so that their employee as public servant should exhibit ethical and professional working behavior. Based on those three types of conflict, the conflicts happened in ANP can be categorized as personality conflict, because the rule breaking by drinking alcohol, swearing, physical fighting and smoking in non-designated smoking areas are basically came from each persons personality. Their moral value and lack of self-control are the fundamental reasons why such conflicts happened. However, due to some staffs belong to different departments involved in the conflicts, so the investigator might perceived that the conflicts were between A Department and B Department, but actually they were not necessarily intergroup conflicts. Intergroup conflict occurs when a conflict is between two divisions or departments in the company, and the problem is work-related. Usually, the conflict will be because it is clashing each other interests. For example, the marketing department plans to make complicated advertisement to increase the sales but rejected by the Finance Department because such costly advertisement is over the budget. In terms of managing the conflict that happened due to rule violations, whether it was drinking alcohol in the office or smoking in forbidden areas, the party who break the rule must get the punishment because it is against the company rules. However, the disputing parties might still have some conflicts remained and the company needs to do something to end such conflict. Compromising should be the best approach, since it helps the conflicting employees to move on with their activities. But, one must certainly avoid confrontation, because it may lead to another conflict, which were physical fighting and verbal swearing.

If the company has someone responsible in the higher position to make decision, then it will be very effective to resolve the conflict. Therefore, facilitation technique from ADR approach will also give the best outcome to the conflict or dispute. Among the seven conflict prevention actions, the very best action is to ensure the clear guidelines to the employees of ANP. From the case, we could assume that even though the company rules and regulations were there, but employees did not seem to be aware of these rules and regulations, hence they were still act disrespectfully and irresponsibly. Every employee should be given crystal clear guidelines of what is forbidden and what kind of punishment they will get if they do not obey the guidelines. Not just verbally, but also in printed contract. Therefore, when they are found disobeying the rules and regulations, they are breaching the contract and the company is able to give punishment accordingly.
In the case of non-compliance with the smoking prohibition inside the company, organizational culture appears to be insufficiently developed. Indeed it can be seen that the prohibition was signified in the rules of the company but not respected. It also seems that employees do not feel commitment, they do not take about the health of each and tensions between each department. An organizational culture must create cohesion between employees and departments and it must define good and bad behaviors and enforce values. We here think it would be useful to use an outside expert, as we said in the definition, he can easily work on internal issues and reasons for the lack of a common culture. This expert will be probably more respected because he has an outside view and he is impartial. The values that should be highlighted and integrated have to be the justice, respect, and professionalism. We believe that the company should move towards a Hierarchical culture, bringing stability and control. The establishment of a charter, as is often done in businesses and schools, is also important. We explain how to manage the conflict, clear rules about alcohol and smoking, and each employee should sign it. The lack of cohesion characteristic of companies with a lack of organizational culture can be filled by small groups, which work on writing the charter. It also seems important to remember the history of the company and its role; it is the component of the corporate culture. ANP is a regulatory organization. It is therefore important that the rules and seriousness are the core values of the company. 2

C.

Conclusion & Recommendation

For most people, conflict is associated with a negative, destructive situation. And yes, it certainly has the potential to wreak havoc within a work team. But it need not be a bad thing. Constructive conflict management can produce creative solutions to problems, higherquality relationships, and constructive change. The key is to resolve conflict in such a way that it improves the situation for all the relevant parties involved. Important steps in this process include: 1. Identify the problem. Find out what the source of the conflict is and in what stage the conflict is in. The aim is to try to get involved as soon as possible. 2. Give both sides a voice. Arrange for a meeting and make sure that there is a mutual airing of differences, complaints, and negative feelings. Both parties must feel that this is a neutral space. Don't meet with the parties separately this could give the more persuasive party an unfair advantage. 3. Work through the differences. This will require time and commitment. Here, the aim is to bring about greater understanding of the parties' different attitudes, perceptions, and positions. Encourage both sides to put forward their points of view and encourage them to try and understand each other's point of view. 4. Identify solutions. Find a resolution for each issue. The best way to do this is to ensure that both parties play an active role in identifying a solution to the different issues. Listen carefully as the employees blow off steam, and then wait for them to propose their own solutions. 5. Reach a compromise. When resolving conflict, the aim should be a win-win outcome, where both parties obtain their goals through creative integration of their concerns. Get both parties to acknowledge the issues, and agree to move forward. It might be a good idea to get them to sign an agreement. 6. Keep communication channels open. Ensure that relevant parties meet regularly to discuss any awkward situations or problems that could give rise to future conflict situations.

7.

Do follow-up. Remember to do follow-up in due course, for example three months after the initial meeting. Check whether the issues are resolved, and whether further mediation is required. In the ANP cases, number 6 may be skipped because the conflict should be able to

finish immediately after the decision was made. Regular meeting between the conflicting parties may not give any positive solution to prevent future conflicts. However, follow up by the responsible person (the HR staff or the H&S staff) is very important to ensure the conflicting parties has completely move forward and the conflict has completely resolved.

For the above two conflicts happened at the ANP, we can suggest the following alternative solutions, mainly to prevent similar conflicts from happening in the future: 1. Explain to the employees the company rules and regulation at the first day of their employment to ensure that they have been given notification. It is very important to also make clear that no alcoholic drinks can be consumed in the office, at anytime (during and after working hours), and at any events (including company gathering and party). 2. Put warning signs of no smoking in strategic places around and in side the office. It is important to include the information on where the employees are allowed to smoke and what kind of punishment they will receive if they broke the rule. 3.

To stop the excesses with the cigarette, a break of fifteen minutes morning and afternoon could be included in the charter. This break could affect smokers and nonsmokers. This pause allows the smokers and non-smokers to be together to address other issues, informal meetings. The company could win a collective spirit, and improve the cohesion necessary for the development of the corporate culture.

4.

Assign some staffs to act as a controller, and he or she shall be given authority to warn (verbal or written) to the rule breakers. Other staffs can also report to this authorized person whenever someone acts against the company rules.

5.

To prevent bringing alcoholic drinks or dangerous materials to the office, the company could implement security check (bag checking and metal detector) before entering the office.
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D.
1. Fatima Abdad

List of Reference

Human resources Officer Authoridade National do Petroleum (ANP) Timor Leste Phone : +67077342797 2. Zelio Moniz Health and Safety officer Authoridade National do Petroleum (ANP) Timor Leste Phone: +67077240828