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Business and Economics Journal, Volume 2010: BEJ-15

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Empirical Study of the Effect of Conflict on Organizational Performance in Nigeria 1
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O M Hotepo, 2A S S Asokere, *I A Abdul-Azeez1, 2S S A Ajemunigbohun

Department of Business Administration and Management Technology; 2Department of Accounting and Finance; Lagos State University, P.M.B. 0001, LASU Post Office Ojo, Lagos, Nigeria *Correspondence to: I A Abdul-Azeez, ibforson@yahoo.com Accepted: September 7, 2010; Published online: October 28, 2010

Abstract The purpose of this study is to investigate the effect of organizational conflict on organizational performance. This was carried out by investigating the causes, types, reason and strategies for managing conflicts in some selected service organizations in Nigeria, with a view of coming out with ways of improving their performance and productivity. The study employs descriptive research design and uses questionnaire to collect data from 96 managers in some selected Airlines, Road Transport and Insurance companies in Lagos Metropolis. The research revealed that limited resources is the major cause of conflict and that conflicts have both negative and positive effects on organization, but when managed properly, the positive effects can be used to encourage organizational innovativeness and build cooperation among the employees. Keywords: Conflict; Organization; Performance; Effect; Nigeria.

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Introduction

Conflicts are inevitable part of organizational life since the goals of different stakeholders such as managers and staff are often incompatible [1]. Conflict is an unpleasant fact in any organization as longer as people compete for jobs, resources, power, recognition and security. Organizational conflict can be regarded as a dispute that occurs when interests, goals or values of different individuals or groups are incompatible with each other [2]. This results into a situation whereby they frustrate each other in an attempt to achieve their objectives. Conflict arises in groups because of the scarcity of freedom, position, and resources. People who value independence tend to resist the need for interdependence and, to some extent, conformity within a group. People who seek power therefore struggle with others for position or status within the group. Conflict is a part of organizational life and may occur between individuals, between the individual and the group, and between groups [3]. While conflict is generally perceived as dysfunctional, it can also be beneficial because it may cause an issue to be presented in different perspectives. Conflict has both positive and negative effects [4]. It can be positive when it encourages creativity, new looks at old conditions, the clarification of points of view, and the development of human capabilities to handle interpersonal differences. Conflict can be negative when it creates resistance to change, establishes turmoil in organization or interpersonal relations, fosters distrust, builds a feeling of defeat, or widens the chasm of misunderstanding. Unfortunately, the term "conflict" has only the connotation of "bad" for many people; so much so that they think principally in terms of suppression, giving little or no attention to its more positive side. Rico [5] emphasizes this by stating that it seems entirely likely that many, if not most, organizations need more conflict, not less. Pondy [6] also stated that the absence of conflict may indicate autocracy, uniformity, stagnation, and mental fixity; the presence of conflict may be indicative of democracy, diversity, growth, and self-actualization. Tjosvold [7] complements this statement arguing that conflict is not the opposite of cooperation but a mechanism that allows to perceive benefits of cooperative work. Furthermore, conflict is considered psychologically and socially healthy. It is psychologically healthy because it provides a breather for frustrations and enables a feeling of participation...
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