Conflict, Decision Making, and Organizational Design
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AIG insurance company is a firm that is engaged in offering insurance services to business persons, individuals, and corporate bodies. As in an organization, there are various challenges that arise due to its organizational structure, decision-making process, and conflicts among the organization members. The organizational management has to put in place strategies that are aimed at handling these issues in a way that all members in the organization will be fully satisfied.
Applying Negotiation Strategies in Conflict Resolution
AIG Insurance Company Limited is usually faced with conflicts that arise due to conflicting interests, organizational cultures, and values. It is important to understand that workplace related conflicts and other forms of hostilities can arise due to a number of reasons at any given time or circumstance. Conflict among AIG employees can result into reduced productivity, and the morale of employees may greatly be affected, resulting into high rate of turnover among employees of the company. In order to avoid the conflicts which have a negative impact on the company productivity and its employees, managers of AIG need to use various negations strategies in an effective way. These strategies can be effective in handling potential conflicts that arise in the organization. Management in the company has been trained on how to maintain an atmosphere in the workplace, which is professional in nature.
In order for the AIG managers to effectively utilize various negation strategies while dealing with conflicts, a number of factors need to be taken into account. First, managers should not take sides during the conflict negation process. Instead of resolving the problem at hand, taking of sides by manager will increase the impact of the conflict in the organization, the negation efforts will turn out to be fruitless, as long as manager does not remain neutral during the negotiation process (Rahim, 2002). It is important for manager who oversees the negotiation to show respect to all sides that are involved in the conflict. Manager needs to listen to all sides and should not make prejudgments. This will help the AIG management to handle the future conflicts that might arise in the organization effectively.
Secondly, the management of AIG needs always to act fast when a conflict arises, in order to avoid the spread of the conflict all over the organization. It is, therefore, advisable for the management to take timely actions to bring the conflicting parties into a negotiation table to avoid the conflict spread to all other parts of the organization. The management of the company should act swiftly and apply various negotiation approaches to avoid the conflict spreading within the organization, making it ungovernable or unproductive (Rahim, 2002).
In order to effectively use various negotiation strategies in dealing with potential conflicts in the organization, the negotiator needs to understand the problem at hand. The problem leading to conflict should be fully understood with an aim of coming up with an amicable solution to the conflict. In addition, an understanding should be reached by the conflicting parties, in order to resolve the conflict at hand. It is, therefore, crucial for the managers who are involved in the negotiation process to ensure that he or she applies the negation strategies to bring the conflicting parties to understanding.
In conclusion, AIG management can handle future conflicts if it takes into account the abovementioned factors during the negotiation process. These factors include bringing the conflicting parties into understanding; manager should not take sides during the negotiation process and he or she should act fast to avoid the conflict spreading in the organization.
Evidence Based Management
Evidence based management is the process of making various managerial decisions that draw inferences from the evidence that is available. It is important for the management of any given organization to use this strategy of decision-making in an effective and efficient way, so that it could help the organization in question to achieve the outstanding goals in the long run. There are a number of issues that management should take into account while using the evidenced based management, in order to make the strategy relevant in handling various working environment challenges.
AIG management should first check the basis of various beliefs that are assumed on the evidence available. For instance, is low morale related to poor pay? Before jumping into conclusion, it is important to ensure the evidence is provided on the argument at hand. This will ensure that management takes a course of action that is workable, based on the evidence available, but not on the beliefs and assumptions (Davies, Nutley & Smith, 2002). Management should always start from the available evidence. This factor helps to ensure that the decision made is based on the evidence available, rather than mere assumptions. For instance, management should base the human resource decision related to low morale on the basis of evidence available within the organization to justify that the problem does exist in the organization. Evidence based management should be focused at preventing the problem, rather than detecting the problem. In order for management of the AIG to handle the working environment challenges by using the evidence based management in handling these challenges, there is a need for management to use the evidence available to prevent the future problems in its decision making process other than detecting the problems. Evidence available on a given issue can be useful in preventing the future problems from occurring, thus, preventing the organization from the probable problems that may arise from, such as problem occurring. An effective management team should, therefore, be concerned with using evidence management strategy in making decisions that will protect the organization from future problems (Davies, Nutley & Smith, 2002).
Another thing that should be taken into consideration, while using evidence based strategy in dealing with working environment challenges, is to ensure that the evidence used is related to the problem at hand. It is crucial for management to ensure that the evidence it is using in the decision-making process fully related to the issue at hand. For example, if management is making a decision relating to increasing productivity within the organization, it is important to ensure that the evidence used to make this decision is related to the improving productivity in the organization. This will ensure that management makes informed decisions that are in line with the objective that they intend to achieve in the long run.
In order to come up with creative decision in an organization, there are a number of blocks, stages, and methods that one should apply. Decision-making can be very powerful if it is combined with intuitive, logical, as well as creative mental processes. The first stage in creative decision-making process is a contributory stage. In this stage, all the organization members are given a room, where they give their ideas on how the problem at hand can be handled. The team dealing with the problem has to identify the problem and come up with facts about the problem. In this stage, the following blocks are used to make the stage a success; the decision-making method to be used, the criteria to be used, and facts relating to the problem are collected. The next stage in creative decision-making is procedural stage where the team develops various strategies to evaluate the courses of action available to solve a problem at hand. In this stage, the following blocks are used; development of the courses of action, evaluation of the courses of action, selection of the course of action to resolve the problem that has been identified (Monahan, 2000).
The next stage in creative decision-making process entails implementing the course of action that is selected in the second stage. The resources are availed by management to ensure that the decision arrived at is fully implemented to resolve the problem at hand. The final stage in creative decision-making is a reflection stage, where one reflects on the whole decision-making process to identify the weaknesses and how effective the decision arrived at has been fully implemented. This stage involves three blocks that are used to make the stage a success. These blocks include assessing implementation process, evaluation of solution effectiveness, and finally, making modification in the solution to fit in the problem being handled.
There a number of methods that AIG management can use in making decisions in a creative way. Brainstorming is the most popular method that can be used in making creative decisions within the organization. This method provides room for generating large number of ideas in a short time. The second method can be attributed listing, where one lists various features of a problem at hand and generate ideas that can be used to resolve the problem at hand. Synetics is another method that is used in generating creative ideas that can be used in making decisions relating to resolving certain problems that an organization faces (Monahan, 2000).
In case of AIG Company, the most effective method of ensuring that management comes up with creative ideas during the decision-making process is brainstorming. Management should employ this strategy during its creative decision-making process given the nature of activities that the company is engaged in, as it provides room for the generation of creative ideas that can be useful in moving the company forward.
Organizational design can be defined as that body of rules and policies that allow a firm to make arrangement relating to its line of communication and command, while allocating responsibilities and rights. There are a number of factors that AIG should take into account to determine the most suitable organization design for the company.
First, the size of the organization is a factor that should be taken into account when developing an organizational structure. Given the size of AIG, which is large, management needs to design an organizational structure that largely depends on delegation of work, authority, and responsibilities (Galbraith & Jossey, 1995). This will make it easier for the management of the company to manage the company efficiently and effectively.
Life cycle of the organization should also be taken into consideration when developing organizational structure. The management of the company needs to identify the stage of company life cycle; it is in order to determine whether it should employ formal or informal organizational design. In case of AIG, management should employ a formal organizational design, given that the company is in its maturity stage (Karen and Gibson, 2008).
Finally, the marketing strategy of the company should be considered when choosing the organizational design. Given that AIG is a multinational organization, it needs to employ an organization structure that will enable the company to deal with various markets, within which it is operating effectively.
In conclusion, the organization needs to take into consideration a mixture of factors, in order to come up with an organization design that will ensure that there is efficiency and effectiveness in the company.