The Cost of Conflict

“Unmanaged conflict is the largest irreducible cost in organisations today and the least recognised.” Dr. Daniel Dana

All conflict has a cost measured in terms of time, emotion, money and business productivity. This is the true cost of conflict in the workplace.

“I had 2 employees who, for a reason I still don’t understand, fell out with each other. Before I knew it all kinds of accusations were flying around about the individuals, the company and myself. We were dragged through the courts and it took 11 months and £87,000 to sort out. It was a complete waste of time and money, not to mention stress. Never again.” Alan CEO of a manufacturing company.

The Facts

Chartered Institute of Personal Development 2014 studies show that:

  • 25% of productivity is lost by individuals involved in conflict.
  • Unresolved conflict is the decisive factor in 50% of employment departures.
  • 65% of employment problems stem from strained relationships between employees.

Between 50%-60% of change programmes never reach their desired end state – McKinsey Global Survey Results

Managers spend between 20%-40% of their time dealing with conflict – Creative Leadership Centre, Eckerd College, Florida

On average, 2.1 hours per worker per week is wasted through conflict in the work place – CHS Alliance HHR Conference June 2016

The tangible costs of unmanaged conflict are significant:

  • Cost of ConflictWasted time – time is money
  • High absenteeism and staff turn over
  • Lost work days and healthcare costs
  • Legal costs and other professional fees
  • Termination packages
  • Recruitment costs
  • Training and development costs
  • The cost of delay – lost revenue, deferred income, penalties
  • Cost to productivity – what could otherwise have been produced
  • Sabotage and theft

The intangible costs of unmanaged conflict are equally significant:

  • It blocks cooperation, communication, collaboration
  • It prevents the exchange of information, ideas and knowledge
  • It leads to poor decision making.
  • It undermines morale, well being and commitment.
  • It disrupts the internal service quality and damages reputations.
  • It stifles innovation and development and hampers change

Ultimately unmanaged conflict reduces business agility, competitiveness and threatens survival.

If you are experiencing conflict and want to minimise the cost of conflict and maximise your opportunity from it contact us to arrange a consultation.