Class 12 Business Studies Lesson 14

Class 12 Business Studies Lesson _ Notes

#Unit -14 Emerging Management Concept

Conflict Management

According to Ricky W. Griffin, “Conflict is disagreement among two or more individuals, groups or organizations.”

Conflict management: Whenever there are people working together, conflict is common. Conflict simply refers to all kinds of opposition or antagonistic interaction between or among individuals or groups. It exists whenever one party perceives that another party has hampered or is about to hamper the accomplishment of goals. The consequences of conflict may be anxiety, lower satisfaction, and decreased performance.

Types of Conflict

1. Intra-personal conflict:
It is a conflict within an individual. This type of conflict arises due to divergent goals and multiple roles that the individual is expected to play. When the individual faces the problem of choosing among competing goals, this type of conflict arises. It may also occur due to role ambiguity.

2. Inter-personal conflict:
This type of conflict occurs when two or more persons interact with one another. It is a conflict between individuals. The main causes of interpersonal conflict are personality differences, perceptions, clash of values and interests, power, status differences, and scarcity of resources.

3. Inter-group conflict:
Conflict between two or more groups of an organization is called inter-group conflict. Examples include conflict between line and staff or between management and union. The major causes of inter-group conflict are competition for scarce resources, joint decision-making, and introduction of change.

4. Inter-organizational conflict:
Sometimes conflict may arise between organizations. This is called inter-organizational conflict. The rise of competition among organizations may lead to such conflicts.

Managing Conflicts in Organizations

A. Stimulating conflict

Not all conflicts are harmful. For positive effects, an optimum level of conflict must be stimulated. Methods include:

Reorganizing: Changing the structure of an organization may create conflict. Breaking up old work groups or departments and reorganizing them with new entrants or responsibilities creates uncertainties and requires readjustment.
Communications: Ambiguous or threatening messages can be communicated to stimulate new ideas.
Encouraging Competition: Using bonuses, incentives, and awards for performance stimulates conflict as groups compete to outperform each other.
Bringing in Outsiders: Management may create conflict by bringing in people with different values, attitudes, or styles, which can lead to innovative ideas.

B. Resolving conflict

Conflict must be resolved when it goes beyond the optimum level. Techniques include:

Problem solving: Conflicting parties discuss problems and potential solutions without focusing on who is right or wrong.
Smoothing: Minimizing conflict by highlighting similarities and promoting peaceful coexistence to prevent worsening the situation.
Compromising: Bargaining to reach an agreement where each party gives something of value.
Avoidance: Temporarily sidestepping or postponing the conflict when it is minor or requires low attention.

Participative Management

Participative management is a process where subordinates are involved in decision-making along with their superiors. Employees are empowered with greater control over the workplace, which also motivates them.

Forms of Participative Management

Quality Control (QC): Quality circles, first started in Japan in the 1960s, are work teams of 8–10 employees from the same area, meeting regularly to analyze and solve work-related problems. Membership is voluntary.
Quality of Work Life (QWL): QWL focuses on working relationships and the overall environment to integrate employees’ needs and improve productivity and satisfaction. Methods include shared ownership, flexible schedules, autonomy, recognition, and incentives.
Self-Managed Work Team: Teams of 5–15 members operate without a manager and are responsible for a complete work process. They plan schedules, assign tasks, and make operational decisions collectively.
Management by Objective (MBO): A philosophy where superiors and subordinates participate in planning and decision-making, based on objectives set together.
Co-ownership: Employees become shareholders, gaining ownership and participation in organizational decisions.

Features of Participative Management

Ethical dimensions: Based on moral principles and values, treating everyone equally in decision-making.
Proper communication: Employees share ideas, suggestions, and feedback, improving organizational efficiency.
Employee empowerment: Employees participate in decision-making and are treated as co-workers.
Recognition of human dignity: Employees are valued equally regardless of designation.
Psychological satisfaction: Ensures respect for individuals, commitment, and co-determination in company policies.

Benefits of Participative Management

Sense of ownership: Employees feel integral to the organization.
Motivation and productivity: Ownership leads to greater focus and higher productivity.
Better creativity and innovation: Employees express opinions, enhancing innovation.
Better decision-making: Decisions are taken after consulting all concerned members.
Implementation: Employees participate in planning, increasing accountability.
Commitment: Employees feel part of the organization, strengthening commitment.

Knowledge Management

Knowledge management is a modern concept established since the 1990s. It involves getting the right information to the right people at the right time, helping them create knowledge and act on it for decision-making.

Features of Knowledge Management

People-oriented: Linked to human competence, intuition, and motivation.
Goal-directed: Tied to strategic objectives using meaningful information.
Ever-changing: Knowledge is continuously updated and revised.
Value-added: Uses pooled expertise and alliances for improved decisions.
Visionary: Expressed in strategic terms to motivate managers.
Complementary: Integrated with other initiatives like TQM, showing interim successes.

Importance of Knowledge Management

Competitive advantage: Knowledge can provide the organization’s edge by creating customer value.
Technology: Rapid dissemination of information requires skilled, adaptable employees.
Organizational change: Helps retain and process knowledge through restructuring, mergers, or acquisitions.
Enhanced decision-making: Assists in applying acquired knowledge for future activities.
Workforce demographics: Facilitates knowledge sharing among diverse workforce groups.

Process of Knowledge Management

Data capture: Raw data is collected.
Data storage: Information is stored digitally or physically.
Data organization: Data is structured for usability.
Data analysis: Patterns are analyzed, turning information into knowledge.
Knowledge sharing: Knowledge is shared with employees to achieve organizational goals.