Many factors affect an organization’s performance for good or bad. Unresolved conflict within the organization can reduce the effectiveness of the organization. Conflicts can be related to tasks, relationships, and processes. Intangible formal and informal forces of leadership, power, and politics influence an organization’s performance. Within the organization there is a power structure that wields power to influence organizational performance. Highly political organizations create a great deal of uncertainty and ambiguity, because organizational members are not able to recognize which of their actions will be rewarded, punished, or even recognized by others. Leaders can influence organizational performance. Effective managers must learn to identify and deal appropriately with all these forces to ensure an organization successfully accomplishes its goals.

Many things affect an organization’s performance. Unresolved conflict within the organization can reduce the effectiveness of the organization. Intangible formal and informal forces of leadership, power, and politics influence an organization’s performance. Some forces have a positive influence, while other forces produce a negative impact in the organization.

Most organizations face various types of conflict. Three types of conflict facing organizations are conflicts related to tasks, relationships, and processes. There are five stages in the conflict process (see Figure 1): “potential opposition or incompatibility, cognition and personalization, intentions, behavior, and outcomes” (Robbins & Judge, 2009, p. 486).

(click for larger image)
Figure 1. The Conflict Process
(Robbins & Judge, 2009, p. 487)

Task conflicts are caused by “disagreements among team members, related to a specific business task, like a marketing plan or a budget” (Yu, 2007, p. 5). These conflicts can put a strain on organizational performance, since team members generally expend more energy dealing with philosophy and other matters rather than getting to work on the task. Sometimes a manager needs to make a decision to do something and get the organization back on track.

Task conflict revolves around specific business tasks to be performed, but relationship conflict generally is unrelated to the specific business at hand. Yu (2007) observed that research indicates that relationship conflict is bad for organizational performance; “a team that does not get along has little chance of performing well” (p. 5). There are different causes of relationship conflict (e.g., culture, race, religion, and work ethic). A manager must determine why members of the team are not getting along and take appropriate action to resolve the conflict.

The team may agree upon the task and get along with each other, but if they disagree about how a task should be performed, “including the distribution of responsibilities and delegation of tasks among their members” (Passos & Caetano, 2005, p. 233), there can be a process conflict. Some projects include disagreeable tasks. Healthy teams generally have a method to distribute and share disagreeable tasks. Process conflict may occur when the same person or persons usually ends up tasked with the disagreeable assignments. Managers need to be cognizant of the distribution of responsibility and tasks to avoid process conflict.

The way a manager deals with conflict can have positive or negative results on the organization. In most cases, it is in the best interest of the organization to face conflict head-on and deal with the situation in a professional manner. Bacal (2004) warned that managers should avoid ugly strategies for dealing with conflict: “you should avoid these approaches like the plague” (p. 22). Avoid the following strategies for dealing with conflict:

1. Non-action. Sometimes doing nothing might be the smart thing to do, but most of the time doing nothing results in conflict escalation and a false impression that nothing is wrong. “Everyone knows you have conflict, and if you seem oblivious, you also seem dense and out of touch” (Bacal, 2004, p. 22).
2. Administrative Orbiting. Orbiting does not ignore the problem, like non-action, but avoids dealing with it. The manager may say he is dealing with the problem by collecting more data or documenting performance, but does nothing about it.
3. Secrecy. People in some organizations try to avoid conflict by not letting others in the organization know what they are doing. “By being secretive, you may delay conflict and confrontation, but when it does surface, it will have far more negative emotions attached to it than if things were more open” (Bacal, 2004, p. 22).
4. Law and Order. “Managers using this strategy mistakenly believe they can order people to not be in conflict” (Bacal, 2004, p. 22). This strategy may appear to work on the surface, but ultimately creates greater conflict as people suppress frustrations.

Leaders influence organizational performance. In healthy organizations, “leaders are admired, respected, and trusted. Followers identify with and want to emulate their leaders” (Boerner, Eisenbeiss, & Griesser, 2007, p. 16). A good leader identifies and meets the needs of team members. Boerner, Eisenbeiss, and Griesser (2007) argued that effective leaders provide inspirational motivation (meaningful work), intellectual stimulation (mentally challenging, yet within worker’s ability), and individualized consideration (need for achievement and growth).

Zhang and Faerman (2007) proposed the development of distributed leadership, where “leadership roles [e.g., making important decisions] are distributed across different individuals in the organization” (p. 479). A 1999 organizational study revealed that “the leadership actions of any individual leaders are much less important than the collective leadership provided by members of the organization” (Zhang & Faerman, 2007, p. 481). What really matters is the decision of the team, not necessarily which member of the team made the decision. The collective leadership decisions of the team influences the performance of the organization.

Organizations wield various types of power to influence aspects of business. Within the organization there is a power structure -- sometimes formal, sometimes informal -- that wields power to influence organizational performance. Social networks within the organization can create informal power for the leaders of those social networks. Malott (2003) observed that “some people clearly seek to develop social networks to achieve social power over others…to ensure that they themselves, rather than someone else, get the desired resources” (p. 53). “Organizations amplify the power of those who control them” (Guillén, 2007, p. 167). Effective leaders will recognize and learn how to control the informal power within their organizations.

In an ideal organization, everyone would do exactly what they were supposed to do and the influence of power would be unnecessary. However, Clegg, Courpasson, and Phillps (2006) pointed out that this utopian organization probably does not exist. Because everyone does not always do exactly what they are supposed to do, management uses various forms of power (involving the imposition of will) directed at framing the conduct of others. This process of imposing will must be acknowledged by both sides. “Others must learn to be managed just as those who will manage them must learn that which constitutes managing in any given place and time” (Clegg, Courpasson, & Phillps, 2006, p. 41).

Harris, Harris, and Harvey (2007) defined organizational politics as “actions by organizational members that are perceived to be self-interested and directed toward furthering members’ own goals, without regard for the well-being of others or the organization” (p. 635). Examples of politics within organizations are “withholding information from coworkers, failing to enforce policies and procedures appropriately, using flattery to get favors, shifting blame, and maligning others to make oneself look better” (Harris, Harris, & Harvey, 2007, p. 635). Highly political organizations create a great deal of uncertainty and ambiguity, because organizational members are not able to recognize which of their actions will be rewarded, punished, or even recognized by others (Harris, Harris, & Harvey, 2007).

Treadway, Adams, and Goodman (2005) observed that many organizations do not have a consistent political climate. Different departments displayed different behavior. Additionally, “employees are differently affected by the level at which they perceive political activity to be occurring in the organization” (Treadway, Adams, & Goodman, 2005, p. 204). Robbins and Judge (2009) identified individual and organizational factors that influence political behavior. Individual factors are: “high self-monitors, internal locus of control, high mach personality, organizational investment, perceived job alternatives, and expectations of success” (p. 464). Organizational factors are: “reallocation of resources, promotion opportunities, low trust, role ambiguity, unclear performance evaluation system, zero-sum reward practices, democratic decision making, high performance pressures, and self-serving senior managers” (p. 464).

Organizational performance is influenced by several factors. This paper provided an overview of some internal factors that influence organizational performance: conflicts (task, relationship, and process), leadership, power, and politics. Effective managers must learn to identify and deal appropriately with all these forces to ensure an organization successfully accomplishes its goals.

Bacal, R. (Summer 2004). Organizational conflict -- The good, the bad, and the ugly. Journal for Quality & Participation, 27(2), 21-22.

Boerner, S., Eisenbeiss, A., and Griesser, D. (2007). Follower behavior and organizational performance: The impact of transformational leaders. Journal of Leadership & Organizational Studies, 13(3), 15-26.

Clegg, S., Courpasson, D., and Phillps, N. (2006). Power and organizations. London: Sage.

Guillén, M. F. (April 2007). Complex organizations and power. International Public Management Journal, 10(2), 167-171.

Harris, R. B., Harris, K. J., and Harvey, P. (December 2007). A test of competing models of the relationships among perceptions of organizational politics, perceived organizational support, and individual outcomes. The Journal of Social Psychology, 147(6), 631-655.

Malott, R. W. (August 2003). Power in organizations. Journal of Organizational Behavior Management, 22(3), 51-60.

Passos, A. M. and Caetano, A. (2005). Exploring the effects of intragroup conflict and past performance feedback on team effectiveness. Journal of Managerial Psychology, 20(3/4), 231-244.

Robins, S. P, and Judge, T. A. (2009). Organizational behavior (13th ed.). Upper Saddle River, NJ: Pretence Hall.

Treadway, D. C., Adams, G. L., and Goodman, J. M. (Winter 2005). The formation of political sub-climates: Predictions from social identity, structuration, and symbolic interaction. Journal of Business and Psychology, 20(2), 201-219.

Yu, L. (Winter 2007). Conflict in the workplace. MIT Sloan Management Review, 48(2), 5.

Zhang, J. and Faerman, S. R. (August 2007). Distributed leadership in the development of a knowledge sharing system. European Journal of Information Systems, 16(4), 479-493.