Conflict & Negotiation in Organization

What is conflict?

Conflict refers to incompatibilities between parties that are caused by opposition differences in opinions or perspectives. Conventionally, conflicts within are viewed as retrogressive elements that derail productivity and profitability. Therefore, conflict negotiation is required to solve the differences in a peaceful and positive manner to the involved parties. Unfortunately, managers only appreciate the negative side of the conflict, but recent approaches acknowledge the benefits that come with conflicts in organizational environments. With the changing leadership approaches to accommodate the bottom-up style, managers are now appreciating the value of employee involvement in organizational operations. However, such involvements come with differing opinions, which ay lead to conflicts. The organizational structure should factor in the expertise and managerial interpersonal skills required in conflict resolution and negotiation.

Forms of conflicts

Conflict occurs through dysfunctional or functional differences in an organization. Dysfunctional conflict is debilitating, and thus it ultimately results in poor productivity; however, functional conflict challenges the involved parties to face their issues from a positive perspective and improve on their weaknesses, which leads to improved productivity. The realization of the beneficial aspects of a conflict in the workplace depends on how the differences are handled.

This paper will highlight the different types of organizational conflicts and their causes. Moreover, the paper will present the approaches to conflict resolution and negotiation and give the comparative conflict negotiation approaches in the Bahrain Development Bank and Tamkeen organizations.

Organizational conflicts

Many managers in profit-making organizations believe that conflicts are dysfunctional. On the other side, the majority of managers in non-profit making organizations hold that conflicts enhance healthy and standardized organizational decision-making process. Even though the conflict may seem as a retrogressive aspect, which should be avoided, it has some significant benefits for organizational performance. For instance, a conflict-free environment in an organization can lead to lethargy. Therefore, moderate conflicts lead to the development of new ideas and innovations that result in healthy competition coupled with strengthening general organizational performance.

Types of organizational conflict

Task conflict

This type of conflict arises between workmates or parties regarding the work activities or the goal achievements in an organization. Moreover, this form of conflict arises due to different opinions with respect to the approaches to organizational performance and competitiveness. For instance, suppose one manager proposes that in order for the company to remain in the competitive edge it must retrench some workers. This manager strongly believes that retrenching some workers will minimize costs and maximize revenues that will ultimately lead to high profits. However, another manager may hold the view that employing experienced and expertise in job specifications would increase productivity, hence high profits. Consequently, the two managers’ approaches towards profit maximization differ and this aspect may bring disagreements in opinions. Due to their indifferences in respect to productivity and profit-making strategies, conflict is bound to arise.

Relationship conflict

This form of conflict comes from differences in interpersonal issues between parties or individuals in an organization. The interpersonal differences may arise due to differing beliefs, customs, perceptions, perspectives, or religions. For instance, a person may be too strict to certain traditions and customs of life aspects like how women should talk to men. A female senior co-worker may act rudely towards task allocation to a male subordinate. This aspect may make the male worker bitter, and thus cause relationship conflict between the two. This interpersonal conflict may be too broad for managers to accommodate subordinates who cannot get along in the working environment. Since the individuals in conflict may have different perceptions, traditions, customs, religious beliefs, and different goal setting approaches in the organization, managers find it difficult to solve some relationship conflicts.

Legal conflict

Conventionally, legal conflict occurs due to differences in perceptions and perspectives amongst different organizations. For example, an organization may notice a malfunction of standards of pricing by a competitor. This organization can take legal measures against the competitor for breaching contractor trading rules and norms that infringe to other organizations in the same industry. Moreover, legal conflict may involve government bodies through whistle-blowers. Employees may expose certain unethical codes of conduct or illegal business practices within an organization. In most cases, many organizations find themselves in legal conflicts through whistleblowing by ex-employees, who act according to the established federal laws of retaliation.

Process conflict

This type of conflict comes from disagreements with regard to the strategies towards goal achievement. The conflict arises between parties or individuals in an organization who agree on the same agenda of goals achievement, but differ in the achievement approaches within an organization. For instance, some managers may agree to retrench certain workers in a bid to ensure constant revenue maximization, but they may differ on the people and the department where to execute the plan. This aspect leads to disagreements on the retrenchment process, which then causes conflicts. This kind of conflict is common amongst managers and executives.

Conflict negotiation and resolution

When a potential harm persists between groups or individuals in an organization, managers can take the responsibility and resolve the conflict. Major conflicts in an organization cause disruptions that consume time and efforts that could be used to perform important production activities. Therefore, managers must be in a position to use the organizational structure to resolve some existing conflicts amongst individuals. Managers can use the organizational structure to manage and resolve conflicts. The approaches used include liaison roles, rules, and procedures, managerial hierarchy, and task forces. In addition, an organization may employ the interpersonal techniques like team building, survey feedback methods, and third-party peacemaking to manage and resolve conflicts. Conventionally, the team building approach enhances the satisfaction and efficiency of different individuals to work together and produce a quality performance. The survey feedback method caters for all individuals’ perceptions and perspectives towards different life aspects in relation to performance towards organizational goal frames.

Conflict negotiation is the process whereby the contradicting parties are harmonized and a common agreement established regardless of the different perspectives and preferences about certain issues. Negotiation may be between employees and the employer, companies, executives, or even labor unions. Mainly, the major elements of negotiation to be resolved are based on at least two parties, whereby different preferences and a common agreement are to be reached amongst the involved parties. Recently, the interest in conflict negotiation has widely grown due to the complexity and rampant growth in the business environment.

Game theory

This method was developed through the involvement of various economists using mathematical models. The model involves the prediction of various preference outcomes expected in the future through numerical analysis. Moreover, the model predicts the outcome of different preferences for diverse parties. This approach provides the exact prediction that negotiators require in a bid to analyze the outcomes of different conflicting parties.

This model requires the managerial team to have all the skills in a bid to be in a position to highlight the possible outcomes before the negotiation process starts. For instance, in the Bahrain Development Bank, this model could not be used practically, as it requires extra skills apart from the financial managerial skills of the managers. Moreover, the negotiation approach does not consider the fact that the negotiation process is not rational, which is one of this approach’s assumptions. Due to the irrational nature of dialogue, this mathematical model towards the negotiation of conflicts seems not to work in the negotiation process.

Cognitive approach

This negotiating approach tries to predict how and what period the negotiators deflect from the rational behavior of the negotiation process. Negotiators usually divert from rationality through overdependence on the available information, the assumption that negotiations will produce the exact required outcomes, and reliance on previously selected outcomes to solve conflicts. Practically, these cognitive approaches can be used by the management to predict the negotiation process and the duly outcome expected in an organization.

The drawbacks of this approach include that it only focuses on negotiating conflicts based on rational behavior, which is not allowed in some sophisticated conflicts. Therefore, it becomes difficult to negotiate conflicts using the cognitive approach since some parties may be in a bitter conflict that does not create room for peaceful negotiations.

Individual differences

This negotiating approach focuses on the personal traits of the negotiators whereby both demographic and personal traits are analyzed to help in the negotiation process. Specifically, the demographic traits include age, gender, and race among others. The personal traits include tolerating ambiguity, risk-taking, the ability to control and accommodate conflicts in individuals, the level of self-esteem, and the degree of authority that an individual can accommodate.

The assumption of such traits is highly meaningful since the negotiation process requires direct personal interaction. For example, in the Bahrain Development Bank, the negotiation process between the organization and the customers required personal interaction to prevent the whistleblowing. This approach seems to work in some organizations even though research shows that only a few positive results can be witnessed with this approach, since the negotiation process is inhibited due to the situational variables from different individuals.

Situational Traits

In most cases, the negotiation process circulates in the situational features framework. The situational characteristics used in this negotiation approach include the communication channels used by negotiators, the power, and authority of the individuals, the expected outcomes of the negotiation process, and the available time for the negotiation process.

This approach is hindered by the discrepancies between different individuals in the conflict to be negotiated. Due to the complexity of the external situational characteristics of individual traits, negotiators find it difficult to match and set a common decision, which is favorable to the conflicting parties. For instance, this approach cannot be used in an organization like the Bahrain Development Bank, since the individuals have different power and authority, different character traits, different goals and ambitions, and different skills and expertise. This aspect complicates the negotiation process in many organizations due to the indifferences in their overall individual preference traits.

The win-win approach

The win-win approach was added due to the need for consultants and negotiators to allocate a specific model to more difficult negotiations. The win-win approach is the best approach to negotiation since it acknowledges that all the involved parties in the negotiation process are winners. In addition, this win-win model approach gives the involved parties the feeling of being part of the negotiation process, which facilitates the setting of a common agreement. This approach is regarded as the best since it accommodates and caters for the needs of the involved parties in arriving at a common agreement. Moreover, there is no superior party than the other and all needs of the parties are satisfied equally and simultaneously.

In the win-win approach, the four basic steps involved include appropriate planning, establishing relationships, forming agreements, and maintaining the relationships towards negotiating conflicts. For instance, proper planning requires each party to state own goals, acknowledge the other party’s goals, set agreement basis, and propose the strategies towards settling possible disagreements. In addition, building of relationship involves activity planning to enhance a personal relationship, allow relationship growth, and instill the mutual sense of understanding to individuals. The trust amongst the involved parties is a very vital element to parties in the negotiation process to promote openness and transparency.

Thirdly, the win-win approach requires each party to acknowledge and appreciate the other party’s goals and preferences. Furthermore, each party should state its agreements and propose the possible ways of settling disputes and disagreements. Usually, the involved parties’ goals match and only a few areas of disagreements, which are then settled through mutual agreements on strategies employed to solve the dissensions. The final step in the win-win approach model is the maintenance of the mutual relationship established. The maintenance of the relationship involves the parties’ feedback, close contact of the parties, and cementing the built trust. The prevailing assumption in this step is that both parties maintain the relationship due to the present and future mutual benefits and transactions therein.

For instance, this approach is used by many organizations like the Bahrain Development Bank. The bank set contract agreement to customers through an outsourced financial lawyer. The contract details the goals, preferences, possible negotiation process, and the rules and procedures that each party is to abide with during the process. This process prevents whistleblowing by the unsatisfied workers and trusted customers. Generally, this approach seems to fit most organizational designs and structures as it caters for all senior and junior workers. Moreover, the model approach caters for needs and goals of both parties to benefit the involved parties mutually and simultaneously.

Conflict negotiations in an organization require managerial skills and expertise to settle disputes and disagreements successfully. Different organizations have disparate approaches towards conflict resolution and negotiation depending on the organizational structure. The Bahrain Development Bank is one of the financial service provider organizations that have faced some organizational conflict in Dubai. The bank has its own strategies for dealing with conflicts that best suit its structure and environment.


Tamkeen is a peace-building organization that seeks to settle conflicts among clients and the organization. The Tamkeen organization has set rules and policies between the client and the organizations. The organization usually presents contract rules to clients on which they are to operate on. In addition, the organization clearly communicates the interest of conflict in the ownership or partnership agreements. Furthermore, any breach of the rules and policies established in the contract leads to conflict. Upon any conflict in the contract between the clients and the organizations, the contract is breached. The conflict negotiation process is then forwarded to the Tamkeen’s legal team. The legal team then sticks to the contract rules and policies set in the agreement form of partnership or ownership. Evidently, the conflict resolution process in Tamkeen is based on penalties for the breach of a contract that will culminate in conflict between the two parties. The conflict resolution does not cater for the needs or goals of the client in the conflict negotiation process. Moreover, the conflict resolution and negotiation is not friendly as the penalties are tough on the clients; for instance, dropping the beneficiary out the organization and paying the costs. Ultimately, the conflict resolution does not cater the other parties’ interest in the conflict negotiation.


Comparing the two organizations based on conflict negotiation and resolutions, the approaches seem to differ greatly in managerial skills and the handling of subordinates. The concentration of conflict resolution in Tamkeen is focused on power, authority, and superiority. Unfortunately, this approach will demoralize workers, and thus effectiveness and efficiency in production may lead to a downfall of an organization. In addition, Tamkeen does not acknowledge the benefits of conflict in an organization since the managers view it as harmful. In organizational behavior, too much or little conflict leads to harm on the organizational performance. On the other hand, moderate conflict can lead to innovations, better performance, and goal achievements in an organization. The Bahrain Development Bank emphasizes on peaceful conflict resolution and negotiation approaches. The bank outsources a financial expertise in conflict resolution. The Bahrain Development Bank negotiates conflict via the application of the win-win strategy, which seems to work best for the bank. The Tamkeen Foundation should embrace the win-win strategy in conflict negotiation in a bid to better its performance, hence high returns.


Conflict is an importance element in organizational growth. However, it can be harmful or beneficial. Moderate conflict promotes general growth, but too much or too little conflict may lead to harm as opposed to benefits. However, conflict negotiation approaches may vary in different organizations due to disparate structures, power, authority, communication channels, individual characteristics, different goals, and objectives among others. Furthermore, the degree of conflicts varies the negotiation approach strategies by different organizations. In order to achieve conflict negotiation success, the organization must use both interpersonal and managerial skills simultaneously. This aspect ensures that all disagreements are harmonized and a neutral agreement in favor of the involved parties is established. Amongst the discussed approaches to conflict negotiation, the win-win approach seems to be highly interactive and considerate to the involved parties. However, not all the organizations will be in a position to negotiate conflicts successfully due to variance in different organizational management skills. Therefore, every organization has its own cultures, norms, decency, skills, and expertise in different conflict negotiation approaches.

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