THE EFFECT OF CONFLICT MANAGEMENT ON THE ORGANISATIONAL PERFORMANCE (A CASE STUDY OF SUNSEED NIGERIA LIMITED, ZARIA)


THE EFFECT OF CONFLICT MANAGEMENT ON THE ORGANISATIONAL PERFORMANCE (A CASE STUDY OF SUNSEED NIGERIA LIMITED, ZARIA)  

ABSTRACT

Conflict is a natural phenomenon in most organisations as long as human relationships are involved. As such the existence of conflict has become an issue of concern in Sunseed Nigeria Limited, Zaria as a result of employees’ welfare. The resulting effect has not only affected the employees but also the organisation as a whole. This study examined the Effect of Conflict Management on the Performance of Sunseed Nigeria Limited, Zaria. The study adopts survey design and is cross sectional in nature. The population of the study consists of 112 staff of Sunseed Nigeria Limited, Zaria. Multiple regression was utilized in analyzing the data. The study found that collaboration strategy and avoidance strategy have positive significant effect on the performance of Sunseed Nigeria Limited, Zaria, while compromise strategy has a negative significant effect on the performance of the organisation. The study concluded that there is no one best strategy in managing conflict as the management of conflict depends on the behavioural intentions of the parties to conflict, the time frame and the situation the organisation finds itself. It therefore recommended that management of Sunseed Nigeria Limited should emphasize the adoption of collaboration and avoidance strategies in order to improve the performance of the organisation.

TABLE OF CONTENTS

Title page - - - - - - - - - - i

Declaration - - - - - - - - - - ii

Certification - - - - - - - - - - iii

Dedication - - - - - - - - - - iv

Acknowledgment - - - - - - - - - v

Abstract - - - - - - - - - - vii

Table of contents - - - - - - - - - viii

List of Tables - - - - - - - - - - xi

List of Figures - - - - - - - - - - xii

List of Appendices - - - - - - - - - xiii

CHAPTER ONE: INTRODUCTION

Background to the Study1

Statement of the Research Problem…4

Research Questions…7

Research Objectives…7

Research Hypotheses…8

Significance of the Study8

Scope of the Study9

Limitations of the Study9

CHAPTER TWO: LITERATURE REVIEW AND THEORETICAL FRAMEWORK

Introduction…10

Concept of Conflict…10

Transition in Conflict Thought…13

Signs of Conflict…15

Causes of Conflict…17

Effects of Organisational Conflict…20

Concept of Conflict Management…21

Strategies for Conflict Management…23

Collaboration Strategy24

Compromise Strategy26

Avoidance Strategy26

Criteria for Conflict Management…28

Concept of Organisational Performance29

Conflict Management and Organisational Performance32

Review of Previous Studies…33

Theoretical Framework41

CHAPTER THREE: METHODOLOGY

Introduction…44

Research Design…44

Population of the Study44

Sampling Technique45

Source and Method of Data Collection…45

Techniques of Data Analysis…45

Measurement of Variables…46

Validity and Reliability of Data…47

Model Specification…47

CHAPTER FOUR: DATA PRESENTATION AND ANALYSIS

Introduction.49

Responses…49

Data Presentation.50

Descriptive Statistics of the Variables…50

Correlation Matrix55

Normality Test…56

Multicollinearity57

Test of Hypotheses…58

Findings and Discussion.60

CHAPTER FIVE: SUMMARY, CONCLUSION AND RECOMMENDATIONS

Summary of Findings.63

Conclusion.64

Recommendations.64

Suggestion for Further Studies.65

References. 66

Appendices… 73

LIST OF TABLES

Table 3.1 Measurement of Variables… 46

Table 4.1 Summary of Response Rate… 49

Table 4.2 Descriptive Statistics on Organisational Performance 50

Table 4.3 Descriptive Statistics on Collaboration Strategy 52

Table 4.4 Descriptive Statistics on Compromise Strategy 53

Table 4.5 Descriptive Statistics on Avoidance Strategy 54

Table 4.6 Correlations of Variables… 55

Table 4.7 Tolerance and Values for Independent Variables (VIF) 57

Table 4.8 Multiple Regression Result (model summary)… 58

Table 4.9 Multiple Regression Result (coefficients). 59

LIST OF FIGURES

2.2 Proposed Research Model 43

4.1 Histogram… 56

LIST OF APPENDICES

Appendix A: Letter of Introduction… 73

Appendix B: Questionnaire 74

Appendix C: Reliability Output 76

Appendix D: Descriptive Statistics Output 78

Appendix E: Correlations Output… 82

Appendix F: Multiple Regression Output… 83

Background to the study

CHAPTER ONE INTRODUCTION

In every aspect of human society and endeavor, conflict is seen as a natural phenomenon that is, inevitable as long as human relationships are involved. It is a process that begins when one party perceives that another party has negatively affected or is about to negatively affect something that the first party cares about (Robbins, Judge & Vohra, 2012). At home and at work,conflict is very common and in some cases unavoidable (Mughal & Khan, 2013). As a result of people interacting with each other, friction, disagreements or arguments may arise resulting from actual or perceived differences or incompatibilities, thereby escalating to conflict. Thus, conflicts in organisations can take many formssuch as interpersonal conflict, task conflict and process conflict which give rise to diverse approaches to conflict management (Budd & colvin, 2013).

Nigerian Government over the years however has set up various techniques that will guide organisations in the management of conflicts. Some of these management techniques are available in the provision of Labour/Employment Act, 1971; Workmen's Compensation Act, 2010, Trade Dispute Amendment Decree, 1988, No 39 and Trade Dispute Act 18, 2004 which provided five steps for legal management of conflict in organisations in the country (Akinwale, 2011). According to Akinwale, 2011, these policies are voluntary settlements of conflict with the use of internal machinery of grievance procedures and also with the use of external machinery comprising of mediator, conciliator, and reference of disputes to industrial arbitration panel, national industrial court and the constitution of a board of enquiry. In the resolution of conflict, the judgment of the national industrial court is final and binding on the employers and employees from the date of the judgment in the country. Longe (2015) identified that the Trade Union Act,

2005 is also used for managing union-management conflict in organisations and has been adopted by some multinational firms in the country.

Sunseed Nigeria Limited, Zaria is a multinational organisation involved in the production of vegetable oil and sale of poultry feeds for export. The organisation is often faced with the issue of employees‟ welfare. Employee welfare is an important source of motivation to employees and the lack of it has led to employees having grievances against management which has most times resulted into conflict between both parties and the resulting effect has affected not only the performance of the employees but the organisation. Managing the organisational conflict became necessary so as to improve its performance.

Conflict management involves doing things to limit the negative aspects of conflict and to increase the positive aspects of conflict with the aim of enhancing learning and group outcomes, including effectiveness or performance in organisational settings (Rahim, 2011). Conflict management is something that managers need to deal with as conflict significantly affects employee morale and turnover, which affects the prosperity of an organisation, either constructively or destructively. Therefore, the effectiveness or otherwise of the management of conflict is largely dependent on how well the causes of the conflict have been understood.

When conflict is well managed, it can bring enormous benefits to people and organisations as conflict management is often one of the biggest drivers of change in any organisational set up. If properly handled, it can create stronger bonds, help people to be more innovative, build effective teams, establish strong working relationship and eventually improve individual as well as organisational performance. The key is to openly face an issue and negotiate a win-win outcome from those parties involved (Garcia, 2013).

Robbins, Judge, Millett and Waters-Marsh (2008); Robbins, Judge, and Vohra (2012) identified five major strategies for managing conflict in organisations based on assertiveness and cooperativeness which, according to Adeyemi & Ademilua as cited in Lazarus (2014), are the internal mechanisms used by the various authorities in resolving conflict. Assertiveness means the degree to which one party attempts to satisfy his or her own concerns whilecooperativeness means the degree to which one party attempts to satisfy the other party‟s concerns. They include: collaboration, compromise, accommodation, competition/domination and avoidance. In the context of this work, collaboration, compromise and avoidance strategies will be considered. This is because the three conflict management strategies provide a satisfactory balance for both parties involved in conflict in terms of assertiveness and cooperativeness. The accommodation and domination strategies will not be considered in the study because they do not provide satisfactory balance to the parties involved in conflict. This is because it leads to one party benefiting at the expense of the other.

Collaboration strategy refers to assertiveness and cooperativeness as it allows both parties‟ goals to be completely achieved by putting the concerns of both parties into consideration. Mughal and Khan (2013) assumed that collaboration strategy enables people take time to listen to others in order to find the best solution to handle the conflict. Compromise strategy refers to mid-range assertiveness and mid-range cooperativeness as it requires parties to conflict to give up something in order to settle the conflicting problem, as such there is no clear winner or loser. This usually happens when employees get a sense of fear to lose any relationship with their colleagues or with their managers. Avoidance strategyrefers to unassertiveness and uncooperativeness and occurs when parties to conflictrecognize that conflict exists and want to withdraw from it or suppress it by trying to ignore it.Each of the above techniques is unique in its

own way and will be considered with a view to ascertaining the performance level of the organisation.

Organisational performance is seen as the result of an activity which has been achieved by an organisation related to its authority and responsibility in achieving the goal legally, not against the law, and conformingto the morale and ethics of the organisation (Almajali, Alamro & Al- Soub, 2012). Organisational performance can either be measured financially (earnings per share, return on equity, return on asset) or non-financially (market share, customer satisfaction, employee morale). The appropriate measure selected to assess organisational performance (financial or non-financial) is considered to depend on the type of organisation to be evaluated, and the objectives to be achieved through that evaluation. However, improved organisational performance is dependent on the appropriate conflict management strategy (s) such as, collaboration strategy, compromise strategy and avoidance strategy adopted by the organisation in managing conflict. Applying the appropriate strategy will improve employees‟ performance resulting to an improved organisational performance. On the other hand, the inability of the organisation to apply the appropriate conflict management strategy(s) will lead to a decline in employees‟ performance which in turn will result in a decline in organisational performance.

Statement of the Research Problem

Managers spend approximately twenty percent of their time dealing with conflict situations due to the growing complexity of organisations, use of teams and group decision making, and globalization (Mullins, 2005). This proved the fact that conflict cannot be totally eliminated within an organisation because wherever you find human beings interacting at whatever levels,

there is bound to be conflict. What is however important is the way conflicts are managed to forestall future occurrence.

The existence of conflict is an issue of concern in Sunseed Nigeria Limited, Zaria.The organisation is confronted with the issue of negotiation of staff bonuses, usually at the end of the year. The lingering issue results into conflict between management and employees of the organisation which manifested in form of employees nursing grievances against management, change of attitude or behaviuor, decrease in effort towards work, physical confrontation between both parties and stoppage of production activities as employees refuse to work. This affected the effectiveness and performance of the individual employees and the organisation as a whole. Attempt by management to resolve the conflict has only led to conflict suppression. This is because management made use of domination strategy which is of benefit to them at the expense of the employees. As a result, there is a need for Sunseed Nigeria Limited, Zaria to devise an effective means of resolving the organisational conflict.

Several studies have been carried out on conflict management; however, most of these studies are qualitative in nature (Fatile & Adejuwon, 2011; Garcia, 2013; Kazimoto, 2013; Nwosu & Makinde, 2014; Ebhote & Monday, 2015). They cannot be generalised in all aspects of organisations, because conflict management has to do with human intentions. While some empirical studies in this area were carried out using some or all the major conflict management strategies on other dependent variables such as job stress, organisational effectiveness and turnover intention (El Dahshan & Keshk, 2014; Kanani & Farahani, 2014; Lazarus, 2014; Sima, Gbolamabbas, & Saeed, 2012); others were on organisational performance (Ongori, 2009;Hotepo, Asokere, Abdulazeez, &Ajemunigbohun, 2010; Obasan, 2011; Mughal & Khan, 2013; Ajike, Akinlabi, Magaji & Sonubi, 2015; Awan & Saeed, 2015 and Longe, 2015). Studies

conducted by Ongori (2009), Hotepo, et al. (2010), Obasan, (2011) and Mughal and Khan (2013)only identified the conflict management strategies used by the organisations understudied but the studies did not measure the effect of the strategies on organisational performance.

Ajike et al.(2015) made use of simple linear regression which does not give room for outlining the proxies of the conflict management strategies such as collaboration, compromise and avoidance strategies employed for the study.Awan and Saeed (2015) identified compromise and avoidance strategies as techniques for managing organisational conflict but the significant effect of these strategies on organisational performance was not conducted. Also,Longe (2015) employed some of the major conflict management strategies such as compromise and avoidance strategies (compromise, accommodation, competition, and avoidance) on organisational performance, but the study did not measure collaboration strategy on organisational performance. However, a detailed study using the conflict management strategies such as collaboration, compromise and avoidance strategies on organisational performance is yet to be achieved, thus the extent of this effect has not also been ascertained.This study contributes towards filling this gap.

Since conflict is inevitable in an organisation, its management will determine whether it will generate positive or negative effect on organisational performance (Uchendu, Anijaobi & Odigwe, 2013). Therefore, this study seeks to examine the effect of conflict management using collaboration strategy, compromise strategy and avoidance strategy on the performance of Sunseed Nigeria Limited, Zaria.

Research Questions.

The specific research questions to be addressed in this study include:

i. To what extent does collaboration strategy affect the performance of Sunseed Nigeria Limited, Zaria?

ii. To what extent does compromise strategy affect the performance of Sunseed Nigeria Limited, Zaria?

iii. To what extent does avoidance strategy affect the performance of Sunseed Nigeria Limited, Zaria?

Objectives of the Study.

The main objective of this study is to examine the effect of conflict management on the performance of Sunseed Nigeria Limited, Zaria. The specific objectives are to:

i. Examine the effect of collaboration strategy on the performance of Sunseed Nigeria Limited, Zaria.

ii. Ascertain the effect of compromise strategy on the performance of Sunseed Nigeria Limited, Zaria.

iii. Determine the effect of avoidance strategy on the performance of Sunseed Nigeria Limited, Zaria.

Statement of Hypotheses.

In line with the research objectives of the study, the following hypotheses are formulated.

H01: Collaboration strategy has no significant effect on the performance of Sunseed Nigeria Limited, Zaria.

H02: Compromise strategy has no significant effect on the performance of Sunseed Nigeria Limited, Zaria.

H03: Avoidance strategy has no significant effect on the performance of Sunseed Nigeria Limited, Zaria.

Significance of the Study

The study is of great benefit to the management of Sunseed Nigeria Limited, Zaria, other researchers, general public and lastly,it contributes to the existing body of knowledge on conflict management.

This study is of importance to the management of Sunseed Nigeria Limited, Zaria in understanding the company‟s conflict management strategies which have an important role in determining the success and failure of the organisation and also enlighten them on the strategies to adopt in the management of conflict so as to improve the performance of the organisation. The research findings and recommendations of this study formed a base to be consulted by other researchers who may wish to make further inquiries into the subject matter. The study is of benefit to the general public as it provides them with adequate information concerning the activities of the organisation as it relates to conflict management in the private sector. This study

also contributes to the existing body of knowledge on conflict management by examining the effect of conflict managementstrategies on organisational performance.

Scope of the Study

This study was carried out on the effect of Conflict Management on Organisational Performance in Sunseed Nigeria Limited, Zaria. The study was carried out on a cross-sectional basis and focus was on the conflict management strategies that contributed to organisational performance. Conflict management being the independent construct was operationalised by the following dimensions: collaboration strategy, compromise strategy and avoidance strategy; while the dependent variable was organisational performance.

Limitations of the Study

The study is cross-sectional in nature which captures the effect of conflict management on the organisational performance of Sunseed Nigeria Limited, Zaria at a point in time. Thus, the study cannot prove causal relationship on a longitudinal basis.

This study is limited in the area of sample size which may not give a comprehensive view on the effect of conflict management on organisational performance. Therefore, there is need to conduct a comprehensive study with more sample size to make concrete conclusions on the management of conflict.

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THE EFFECT OF CONFLICT MANAGEMENT ON THE ORGANISATIONAL PERFORMANCE (A CASE STUDY OF SUNSEED NIGERIA LIMITED, ZARIA)



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