01.31.08
What is Conflict Costing You/ Your Company? Part VII
The next reducible cost of conflict factor is Lowered Job Motivation. Motivation is often decreased due to stress from attempting to manage productivity of job performance in working with a “difficult person”. An employee will experience erosion of job motivation due to the stress of trying to get along with a “difficult person”.
Think of our example, and just look at Charlie who has to listen to Wanda and Fred argue whenever they are around. Charlie can’t focus on his work due to the highly voiced conversations happening around him. Then when Wanda is not around Fred is talking negatively about her and his situation. As well, Charlie now dreads coming into work not knowing what will be going on between Wanda and Fred that day.
In devising the cost of lowered job motivation, you take what productivity is with no conflict and then figure what the % decrease is with the conflict (usually state 100%). In our example we’re going to estimate that the productivity decreased to 80%.Then you look at the employees involved/effected by the conflicts, salaries over the time of the conflict. So combined, (including benefits) Wanda, Fred and Charlie make $210,000; the conflict is over a 6 month period, so that is $105,000 in salary. With a decrease by 20% this is $21,000. The productivity is looked at in terms of an employees salary because the salary is what it takes to achieve this level of productivity.
… reducible costs continue into Part VIII
01.30.08
What is Conflict Costing You/ Your Company? Part VI
The next reducible cost of conflict is Sabotage/Theft/ Damage. There is a direct correlation between prevalence of employee conflict and amount of damage and theft of inventory and equipment. Covert sabotage of work processes and of management’s efforts usually occurs when employees are angry at their employer. Much of the cost incurred by this factor is excused as “accidental” or “inadvertent” errors. This cost is almost certainly greater than you may realize.
My uncle tells me of a factory that he knows of that produces transmission gears by cutting thick pieces of steel with lasers that are directed by software. Several people have access to the computer that runs the software. Just a comma inserted “inadvertently” can cost the company several thousand dollars. It would be hard to pin down just who inserted the comma. It appears to happen most often when management disappoints operators.
A normal (conservative) guideline to utilize for cost here is 10% of the acquisition cost of equipment, tools, and supplies that conflicted employees use in performing their jobs. We can only speculate with our example of Wanda, Fred and Charlie, so for this cost we will enter – low to high, again.
…more reducible costs of conflict in part VII
What is Conflict Costing You/ Your Company? Part V
The next reducible cost factor is Restructuring. Restructuring, in response to conflict, is altering the work flow in an attempt to reduce the amount of interaction required between employees in conflict. Usually in restructuring, work flow does not flow as well as it did prior to the conflict.
I spoke with a gentlemen, who supervises engineers in a large multi-million dollar company, about discord in the workplace. He stated that one of the most difficult issues he has is in restructuring the work flow; making sure that assignments and teams are cohesive, and making sure that some engineers are not on the same team as others. The time he has to put into this is frustrating for him, versus just assigning a team to a task and letting them accomplish it.
The typical guideline for developing a cost for this factor is 10% of the combined salaries of employees whose relationship was restructured for the time the restructure is in effect. It can be very difficult to get an exact number with the scenario we’ve been using in this series, so for now we’re going to enter low to high as cost for this factor.
… reducible costs continues in Part VI
What is Conflict Costing You/ Your Company Part IV
The third reducible cost is loss of skilled employees. Organizations invest in employees’ skills by paying a premium salary upon hiring and by providing training thereafter. Exit interviews, which ascertain reasons for terminations, reveal that chronic unresolved conflict is a decisive factor in one leaving a job in at least 50% of all voluntary departures; and chronic unresolved conflict accounts for up to 90% of all involuntary departures (except due to downsizing). Replacing an employee costs 150% of his/her total annual compensation. So referring to our earlier example with Wanda, Fred, and Charlie, if Fred decides to leave the cost or replacing him would be $40,000 X 150% = $60,000; since it would be voluntary use 50% or $30,000 that could be attributed to conflict.
… more reducible cost factors in Part V
What is Conflict Costing You/ Your Company Part III
Continuing from Part II, the second reducible cost is reduced decision quality.When a decision is being made under conditions of conflict, these decisions are always inferior to decisions made when cooperation prevails. Even if someone is not in a position that is deemed “decision maker” there can still be a cost to minimal decisions. For example, let’s say that a secretary decides to put all calls through to voice mail since he/she doesn’t want to talk with their supervisor – thus the supervisor misses an important call that can cost the company a huge sale. Good decisions must be based on an optimum quantity and quality of objective information. If conflict is present between people who share decision-making authority the resulting decisions are likely to be contaminated. A realistic figure for cost in this arena could be very low to exceedingly high depending on the decisions… let’s not put a dollar value here. We’ll just say that the cost could run from low to high.
…more reducible cost factors in Part IV
01.29.08
Strengths and the Effects on Others part 2
To change the pessimistic attitude/ mood is a topic for another time; however, briefly know that you are in control of yourself and your mood and your attitude and are the only one that can change such. You are also in control of how potent you would like to be. Of course different situations can call for different degrees of potency. If you think about potency in terms of cooking… some things taste better with a lot of seasoning (i.e. jalapenos…mmmm the more the tastier, my opinion anyway), and others require only a little seasoning to bring out the best flavor in the food. What is the strength that you need to make a difference in your environment?
… to be continued in part 3
01.28.08
What is Conflict Costing You/ Your Company? Part II
The first reducible cost is “Wasted Time”. To really see a good scenario of this let’s devise a fictitious scenario. Let’s say that Wanda (Supervisor) and Fred (Employee) are in conflict, and that there is 1 other office mate that is also effected by the conflict, Charlie (Employee). Let’s also say that the conflict has been going on for 6 months. Wanda spends about 3 hours a week dealing with the conflict and has a salary of $90,000; Fred spends about 5 hours a week and has a salary of $60,000; and Charlie spends 2 hours a week and has a salary of $60,000. (salary includes benefits).
Wanda
90,000/ 52 wks/ 40 hrs per wk X 3 wasted hrs per wk X 26 wks = $3375
Fred
60,000/ 52 wks/ 40 hrs per wk X 5 wasted hrs per wk X 26 wks = $3750
Charlie
60,000/ 52 wks / 40 hrs per wk X 2 wasted hrs per wk X 26 wks = $1500
So a total of $ 8625 spent on wasted time. This total is for one factor of one conflict.
….more factors to be continued in Part III
What is Conflict Costing You/ Your Company? Series, part I
What is the cost that conflict is causing your industry, your company, your team? You might be amazed at the amount of money that is being thrown away by ignoring or down-playing conflict that is occurring in the office. “Conflict is the least recognized cost and the largest reducible cost to an organization.” (Managing Differences.Daniel Dana, Ph.D. copyright 2006). This series is going to take you through 8 different ways conflict is a cost to an organization. Before reviewing the next few sections, think of a conflict that is occurring in your organization, it can be between two people or between groups of people, etc. The more individuals involved the higher the cost. Also take into account, those that are observing or effected by the conflict that is around them; this is an additional cost as well. (Much of the information provided is research from Daniel Dana Ph.D.)
….. to be continued in part 2
Strengths and the Effects on Others part 1
Strength is defined as the “degree of potency of effect or of concentration ” in 5a of Webster’s Dictionary on-line. Thinking about that definition, relate it to your degree of potency of effect on those around you. What is your strength (degree of potency of effect) on others? Then think about whether your strength is a positive or negative; are you a happy go-lucky person, or do you have a negative or pessimistic view on life? Do others around you tend to match your attitude or mood? Or do they do a do a “180″ to your mood? If they match your attitude then the strength of your potency is high. If they go the opposite of your attitude then the strength of your potency is low. What could you do to increase your strength? Please comment with your ideas.
more to come…..
01.23.08
YOU’re In Control – conclusion
YOU can take this sort of control over change into YOUr personal life as well. Is there a need for a change of attitude when at home. Husband and wife come home from work, make dinner, crash and say so little to one another. What if just one of them decided that this was not enough for them, they decide to take control of the situation and make some changes. The husband decides that the first thing he is going to do when he (or his wife) arrives home is to give her a big, sweet kiss and hug. What changes could happen in that for their conversations, mood, even marriage. Thus his wife would change… she has to change because there is a change in her environment.
Control…. control is a magnificent thing. I often hear: “I’m not in control of …..”. But there is always a degree of control YOU have. YOU have control over what YOU do with something, how YOU react to an idea or negative comment/action, or how YOU will continue on with a decision YOU do not agree with. I challenge YOU to look at your different environments; where do YOU want to see change, what control do YOU have in making that change come about? DO IT!!!!
