Conflict at the Top

Posted by Ricki Sharpe on April 18, 2007  
Filed Under Talent Management

Disagreements are a fact of life in large organisations. Even the most seasoned executives may have strongly opposing views about the wisest course of action for an organisation, particularly given their diverse personal backgrounds or previous immersion in other corporate cultures. But such differences in approach do not necessarily lead to conflicts that are unproductive and damaging to an organisation.

To investigate such issues, researchers recently conducted a study of the organisational values of the top management teams in 31 companies. They examined the presence of perceived and actual differences between management and their CEOs. Interestingly, management perceived considerable differences between their own values and that of their CEOs. Specifically, they rated profit maximisation, innovation and customers service as their three most important values, but they perceived that their CEOs would instead favour organisational growth, value to the community and industry leadership.

However, those perceptions did not match reality despite any close working relationships that may have existed between the CEOs and their management teams. For some values, they overestimated the difference; for other values, they underestimated the difference. This study showed that behaviour is driven by perception rather than reality. Specifically, the greater the perceived difference in organisational values among members of a top management team and their CEO, the greater the conflict.

It is important to remember that actual differences in values have far fewer negative repercussions than people’s perception of those differences. As such, companies should work hard to establish the right atmosphere so that misperceptions are kept to a minimum. To lessen this tendency, the authors advise companies to consider the following: establish an appropriate atmosphere for the team; because perceptions become reality, understand and manage them; investigate the gaps between perceptions and reality; and act decisively to correct gross misperceptions.

This research was conducted by Andrew J. Ward, assistant professor, & Melenie J. Lankau & Allen C. Amason, associate professors at the Terry College of Business, University of Georgia. The research was first reported in the MIT Sloan Management Review, Spring 2007, and will be fully published in a forthcoming issue of the Journal of Managerial Issues.


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