Compensation, Rewards Programs and Team Dynamics
Conflict among members affects organizational performance big time. However, there are divergent schools of thought about the way conflict affects organizations. While some conflicts (Functional Conflicts) are good for the organization as they tend to make the group take the right decisions and proceed in the right path, Dysfunctional conflicts tend to distract the team’s efforts from being focused on the task and could possibly lead the team into anarchy.
Dysfunctional Conflict Causes: Dysfunctional Conflict is generalized as Emotional Conflict, for the primary factors that play a role are the human emotions. When team goals are not clearly specified, team members tend to be in a state of confusion and put forth conflicting views regarding what is expected out of them. However, apart from setting the goals clear, the organization is also required to provide a sense of equity in treatment of employees and in their remuneration.
Team Compensation and Organizational Conflict Management: Conflict Management has a lot to do with compensation. Management is faced with the task of deciding on ways in which teams are to be compensated – should team members be rewarded for what they accomplish or should teams be compensated on what the team per se achieves as part of its goals?
Compensation and Team Dynamics: It has been observed that if team members are individually rewarded for their contributions, there is lesser degree of team cohesion, lack of a sense of belongingness to teams and there is increased competition for resources in the teams. There is a marked decrease in co-operation in teams that leads to team goals not being achieved as planned. On the other hand, if team members are exclusively rewarded for their team performances, it so happens that a few members of the teams tend to bear the burden of the tasks all by themselves while the rest bask in the team’s glory, a trend popularly called ‘social loafing’. This again leads to perceived inequity, resulting in tension surrounding the inequity in distribution of work.
The Best Rewards Programs: It becomes imperative that managements resort to Hybrid Compensation structures that combine individual contributions as well as team achievements in remunerations. Clearly defining what would be expected of team members in terms of their individual and group responsibilities and what they would get back in return helps alleviate tensions and frictions that result in intra-group conflicts that are dysfunctional.
