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How to cut the cost of conflict

Article by Richard Peachey

Work for Acas by researchers Estimating the costs of workplace conflict provides an eye-catching label for a problem that has traditionally been difficult to quantify, existing beneath the surface of organisations, buried within the private experiences of staff. The £28.5 billion gives a concrete form to an everyday issue that’s messy, personal, embarrassing. It helps make the case for action among senior leaders who are guided by bottom line numbers.

The quandary is that big numbers like this can feel meaningless. If the estimate was £30 billion – a vast difference if organisations actually needed to stump up the extra cash – or even £40 billion, would anyone feel different about workplace conflict? We have to remember that individual cases of conflict often cause emotional and psychological suffering, for months, sometimes years. Feelings of shame, anxiety, leading to a collapse in self-esteem and depression.

As the research highlights, of the 10 million employees who contend with workplace conflict each year, more than half of them consequently suffer with stress and mental ill-health; 900,000 have to take time off from their job; almost 500,000 resign; 300,000 are dismissed.

These are just the implications that can be measured. What about the more insidious effects on relationships, attitudes, performance and the organisation’s culture and reputation? Poor workplace relationships. A working environment where there’s a lack of trust, where people feel they’re not able to speak up without recriminations, where there’s simmering resentment. Hidden problems like these lead to low levels of engagement, loyalty and performance – as well as having a nasty habit of bursting out as damaging and high-profile cases of bullying and harassment.

The £28.5 billion is the headline. But the much more significant findings are around what employers do in response to workplace conflict and how this makes a real difference to outcomes. In other words, what’s happening in practice and the lessons for what employers and their staff can do.

When a case of conflict reaches the stage where formal processes are needed, the costs involved are three times greater. There’s more sickness absence and more presenteeism. By contrast, when issues are dealt with early and at an informal level the costs are low. So keeping the conversations going is critical. If staff aren’t having conversations with their manager, with someone from HR or a union, then the costs on average rise sharply. The greatest costs, overall, come from when there is a breakdown, when there’s a resignation or dismissal.

Informal offerings for early intervention and resolution are what make the difference. That means mediation services involving trained staff or external support; managers and HR professionals equipped with the awareness and skills to manage conflict in effective ways; and encouraging a workplace culture of ‘good’ conversations. Deeper and more long-lasting change comes from institutions where the right behaviours and skills have become commonplace. That means building a culture of ‘Conversational Integrity’ that leads to better handling of difficult conversations, allowing employees to feel able to be open, and most of all to create a sense of psychological safety in workplaces – people can be themselves, discuss problems early on without fear of recriminations or being ‘gagged’.

Conflict doesn’t just come with costs. Organisations shouldn’t see conflict – or grievances any kind of clashes and negativity – as parts of working life that need to be squashed and eradicated. As the research has shown, it’s the attempts to deny space for conversation about problems, pushing conflict into formal processes, that creates even more damage. Conflict can be a sign of a healthy work environment. It means there’s diversity of personalities and ways of thinking, people are prepared to challenge convention and speak up about inappropriate behaviour; there’s change and innovation. Workplaces need to open up to deal with the costs of conflict, not shut down, and that takes people skills and maturity.

    Richard is Head of Business Development with workplace relationships specialist CMP. He combines many years’ experience of client relationship management, project delivery and sales & marketing with expert knowledge of workplace conflict and resolution.

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