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Effective conflict resolution strategies that can help you manage the cost of workplace conflict

Do you know how much workplace conflict is costing you and your business? Workplace conflicts cost your business both money and time. 

65% of workplace performance issues are caused by workplace conflict rather than lack of skill or motivation. Based on Queensland Government research, workplace conflict is a significant cause of absenteeism and staff turnover.[1] This can annually cost a medium-sized business $2 million!

More than the money, workplace conflict also cost your business time. According to another research, 30-50% of a typical manager’s time is spent dealing with conflicts, and HR can spend up to 20% of their time in litigation activities. [2]

Workplace conflict is a normal occurrence in any organisation. When properly managed, it can have a positive impact on your business. However, unmanaged conflicts always result in adverse outcomes. And in the long run, it can be detrimental to you, your team and your business.

In this article, we’ll help you manage the cost of workplace conflict through simple but effective conflict resolution strategies.

1. What causes workplace conflict?

The initial step is to look at the root cause. Create a root-cause analysis. A root-cause analysis is a common and often-used business strategy to:

a. Know what happened

b. Know why it happened

c. Know what to do to reduce it from happening again

Generally, there are two types of workplace conflict [3]:

  1. When people’s ideas, decisions or actions relating directly to the job are in opposition.

  2. When two people just don’t get along (personality clash).

According to Queensland Government research, here are the common causes of workplace conflict [4]: 

  • a breached agreement

  • skills deficits

  • a lack of information or misunderstanding

  • conflicting interests or values

  • discrimination or harassment

  • mental illness

  • personality style

  • scarce resources

  • organisational problems

  • bad (corrupt or fraudulent) intent

Now you know the common causes; the next step is to recognise the signs of conflict. Catching the signs earlier can better resolve the conflict before it turns into a dispute. However, not all forms of conflict are visible. Symptoms of conflict may include[6]:

  • lack of employee motivation - an employee might stop participating in team meetings or volunteering to take on new tasks

  • a change in behaviour - employees might become more reserved, less engaged or even hostile

  • decreased productivity - you might notice less output from your staff, or that they take longer than usual to do their work

  • absenteeism - your employees might start coming to work late or taking more time off than usual.

Are you now ready to create your root cause analysis? Here’s a simple 5-step root cause analysis: Step 1: Define the problem

  • What do you see happening?

  • What are the specific symptoms?

Step 2: Collect the data