Brian D. Smith

Sometimes, the eyes really are the window of an executive's soul. As one sat across from me and told me how her management team really had no issues and worked "seamlessly," her eyes told a different story. Fortunately, her initial polite response was soon replaced with a more sincere story of lack of co-operation, distrust and, on occasion, downright hostility between her immediate reports. More sincere still was her resignation to the inevitability of the situation. How, she asked, could management theory help in this case? 

Actually, I replied, management research (I sometimes avoid the word theory and its negative connotations) has a lot to say about 'interunit conflict' (as our jargon labels it), its causes and cures. The seminal paper from Walton and Dutton

A practical starting point is what we can see as the visible signs of the problem. These show themselves as a spectrum from, at the least severe end, avoiding interaction, through lack of co-operation and, classically, "them and us" rhetoric. As the problem escalates, we see distortion of information, implicit or explicit lack of trust and respect and, eventually, open hostility. As bad as these are, it's important not to simply manage these symptoms. It's more useful to understand the causes because these, eventually, lead to a cure or at least a palliative.  

Interunit conflict is so called because it arises wherever the organisation is structured into units or departments that have specific, distinct, tasks. Organisational specialisation in order to gain effectiveness and efficiency is a near-unavoidable consequence of growth and is seen in all but the smallest firms. Specialised organisations are better than non-specialised but only when they manage to integrate the specialist functions. Interunit conflict, in other words, is an integration problem and a chronic one at that. However, it is not equally prevalent or debilitating in all companies. When we look carefully, we can see that certain conditions seem to predispose a firm to interunit conflict.  

There is a long list of such predisposing or aggravating conditions. They include sub-culture differences, goal incompatibility, task interdependence, status incongruity, jurisdictional ambiguity, communication obstacles and, inevitability, individual personality clashes. The list is too long to discuss in full but some small examples make the point. Goal incompatibility arises at operational level when success is defined for different departments in such a way as to cause conflict. Marketing and sales, for example, may clash when success is defined in terms of profit and volume respectively. Similarly, in one company I recently visited, Logistic's targets (on time in full delivery) were in direct conflict with those of Finance (reduction of working capital).  

A second example, task interdependence, is less obvious. There are three basic ways in which different functions are interdependent: pooled (in which there is little interaction), sequential (in which one function depends on another) and reciprocal (in which two functions depend on each other). It turns out that pooled interdependence rarely leads to conflict, sequential interdependence often does, while reciprocal arrangements reduce the frequency of conflict but when it happens it escalates dramatically. If this isn't obvious, look at what happens the next time two reciprocal functions (business intelligence and sales management, for example) meet. You'll see a much clearer example of mutual back-scratching than you do in a more sequential relationship such as marketing and medical affairs. Finally, observe the status levels when conflicts do occur. Frequently, they have as a root cause the perceived 'superiority' of one function over another. It is as if some functions have a departmental ego that annoys the other functions.  

Brief as these examples are, it helps us see how management researchers' explanations of interunit conflict might help us to solve real management problems. Goals, for instance, should be set to be complementary rather than incompatible. The interrelationships between departments can be designed to be pooled or reciprocal, rather than sequential. The jurisdictions between functions can be disambiguated and the status of different functions can be equilibrated. This isn't easy, but it does lead to less in-fighting between departments with all the practical benefits that follow. I recommend you think about this next time your management team argues. Or do they all work seamlessly? 

Articles

Conflict between departments costs money, wastes time and hinders strategy implementation. But we can reduce it and manage it if we understand it, says Dr Brian D. Smith.