Fight or die

Conflict can be good for you and your company. Contrary to popular belief, a leading management consultant claims that ‘escalating conflict internally intensifies corporate innovation’, rather than sowing the seeds of dissent and destruction. Paul Taffinder, director of corporate transformation at PricewaterhouseCoopers and author of a controversial new book, Big Change, says the conventional approach […]

Conflict can be good for you and your company. Contrary to popular belief, a leading management consultant claims that ‘escalating conflict internally intensifies corporate innovation’, rather than sowing the seeds of dissent and destruction.

Paul Taffinder, director of corporate transformation at PricewaterhouseCoopers and author of a controversial new book, Big Change, says the conventional approach to reducing conflict and encouraging consensus can drive an organisation towards a path of cosy decline.

Drawing on lessons from organisations which have faced big problems and have been forced to introduce big changes such as Nasa, IBM, Daimler Benz and engineering conglomerate Asea Brown Boveri (ABB) Taffinder suggests ‘there is a need for constructive damage to the status quo. Dissent needs to be encouraged and orthodoxy destroyed’.

Initially, this approach may seem to be a call to arms for troublemakers, but it proves to be a lot more reasonable on closer inspection.

Speaking at a recent human resources conference in London, Taffinder said that most companies develop along a path following an S-curve. Starting quite slowly, companies gradually take shape and expand rapidly if successful, reaching a peak of growth and innovation.

Then they tend to tail off into stagnation or decline unless the management is willing to encourage and accept criticism, then welcome change.

Unfortunately, success often brings a barrier to change which Taffinder claims is due to ‘groupthink’. This can be seen in well-established organisations such as Nasa, which refused to believe the space shuttle Challenger disaster and subsequent problems with the Hubble telescope were due to human and organisational error not technical hitches.

There was a conspiracy of consensus which encouraged poor management, unlimited expenditure and eventually cost lives.

Similarly, IBM refused to recognise the potential impact of the personal computer because of the power of groupthink which felt Big Blue was unbeatable. It maintained a strategic emphasis on massive mainframe computer installations rather than recognising the unstoppable rise of the desktop PC. The move cost the corporation hundreds of millions of dollars in lost sales.

Daimler-Benz management insisted there was no problem with the new A-Class car. When faced with its failure to perform the ‘elk test’ for speedy obstacle evasion, it claimed the problem lay in the tyres, not a basic deficiency of the A-Class chassis which gave it a tendency to flip over in certain manoeuvres. Eventually the chassis was substantially redesigned at a cost of millions and considerable loss of face.

Taffinder says there were clear indicators of conflict suppression in Mercedes-Benz. Managers deep within the organisation began to put up a front of consensus, even when unpalatable evidence of the A-Class design problem was apparent.

‘Very successful organisations have a sense of invulnerability called groupthink, which tends to typecast competition or even customers as idiots,’ says Taffinder. They believe they are invulnerable, consider silence is consent, tend to be self-censoring and downplay threats. These companies fight to maintain their image rather than solve problems and this can lead to catastrophic failure.

‘Most organisations feel that conflict is bad. But conflict encourages innovation, increases energy and motivation and stimulates a sense of urgency while helping to shape new goals,’ says Taffinder. However, he adds that if you go too far with conflict, there is a drop in motivation.

Taffinder recommends task-related, ‘cognitive conflict’ with the emphasis on raising the level of debate about every aspect of group or project strategy, use of resources, procedures and roles. Debate should not become an excuse for personal attacks: socially emotive areas which involve personal identity, values and group identity, should be avoided.

For example, while an organisation like ABB is enthusiastic about creating a common culture and values, it also encourages strong competition even within its subsidiaries.

Switchgear manufacturer Calor Emag is encouraged to compete with other ABB subsidiaries in southern Europe and the Far East for larger stakes in ABB’s export markets. Conflict is deliberately stimulated, and many small companies within ABB are thrown on to their own resourcefulness to fight for survival and win export market access.

Most large companies do the opposite. According to Taffinder ‘they try to smooth out or even to obliterate internal competition. Conflict is considered bad’.

Psychologists find that reducing stress in the workplace decreases the sense of urgency and encourages widespread indifference to alternative ways to do things. Moreover, it reduces the inclination for different groups or departments to pull together in the same direction.

By contrast, psychologists find that stimulating conflict may boost cognitive flexibility and the ability to deal with complex issues.

However, when the pressure is too high or conflict becomes very personalised, people retreat to more rigid patterns of behaviour, will consider fewer alternatives and experience paranoid feelings.

At times of organisational change, managers often try to brush conflict aside. Taffinder says when organisations are aiming for fundamental change, resolving conflict can be premature or even counterproductive.

‘It is logical to believe that rapid resolution of obstructions and disagreements will allow the firm to get on with the job, but the real effect will be to constrain the quality of decisions, reduce creativity and breed disaffection.’

Taffinder insists there are numerous benefits when conflict is increased to an optimal intensity. Motivation and energy will grow to deal with underlying problems; underlying issues become explicit; understanding of real goals is sharpened; mutual understanding is enhanced; a sense of urgency is stimulated, and avoidance behaviour is discouraged.

To succeed, companies need deeply-rooted and resilient cultural values which are better able to handle change. Furthermore, while people may firmly agree on the cultural values that bind them, there should be room for argument over issues such as strategy, budget, markets, resources and policy.

Job titles can also inhibit healthy debate. ‘Even in teams, people can be hemmed in not only by rules but by job definition. So job descriptions can become defensive earthworks,’ says Taffinder.

Managers need to overcome in-built reservations and learn how to use conflict. Taffinder suggests guidelines for effective corporate confrontation (see box, right). ‘Conflict escalation is counterintuitive so there is a danger of it being used inappropriately,’ he says.

Rules for a row

1. Learn to fight fairly. The aim is to progress the task-related business, not to score personal points. Use hard facts and evidence. All parties should be allowed to air their views.

2. Establish a protocol for conflict. Make a clear distinction between political manoeuvring and personal attack which is demotivating and honest disagreement, which leads to task-related progress and higher-quality decisions.

3. Avoid polite agreement. People move towards early agreement in low-level conflict talks. But this often excludes material facts and new perspectives. Express differences first, then proceed towards integrated and unified decision-making.

4. Build up multiple perspectives, especially where there is a danger of groupthink.

5. Raise the stakes to either/or alternatives e.g. victory or defeat. This sharpens the focus and produces urgency and commitment to action.

Big change: a route-map for corporate transformation by Paul Taffinder is published by Wiley.