CONFLICT MANAGEMENT AND THE PERFORMANCE OF SELECTED SOFT DRINKS FIRMS IN EDO STATE

CHAPTER ONE

INTRODUCTION

1.1       Background to the Study

The word conflict brings to mind images such as antagonism, struggles between parties, opposition process and threats to cooperation. But not all conflicts come in these forms especially in the hotel industry. They came in form of needs to be met or desires to be satisfied, disagreements to be settled and ideas to be shared that eventually lead to change of attitudes, feelings and perceptions.

Fadipe (2004) sees conflict as a form of disagreement in an establishment between two individuals or groups who have cause to interact formally or informally. Similarly, Miller and King (2009), see it as basically a disagreement between two or more individuals or groups over compatible goals. Conflict therefore is a process of incompatible behaviours. It may involve the interference or disruption by one person or group of persons, or in some way or ways which make another action less likely to be effective.

Deutsch (2007), asserts that conflict inevitably means that people are working against each other, in such a manner that their wants are incompatible. It could bring about competition in the pursuit of goals. What the competitor gets comes at the expense of others or the job. It is therefore a counter-productive, disruptive, natural and produces a deviation from the free flow of events. A major factor that can throw parties into a state of incompatibility is their perception of the issue at hand or issue of interest. There are other factors that can contribute to the creation of conflict in organizations like task interdependence, scarce resources, goal incompatibility, communications, individual differences and poorly designed reward system (Mgbeken, 2008).

Conflict is a necessary and useful part of organizational life. It is inevitable and an integral part of the process of change. Indeed, it is an aid to cooperation, not an obstacle. There are two sides to conflict, one is destructive and unhealthy and the other has a problem-solving base where those involved are willing to sublimate differences, to listen to others’ views and to be open and candid to each other, to be supportive and helpful whereas the former defeats cooperation.

Albert (2001) asserts that there are productive and destructive conflicts. According to him, “A conflict is said to be positive when it is constructively discussed by the parties and amicable terms for settlement reached”. Constructively managed conflict induces a positive performance while poorly managed conflict heats up the environment to bring about dislocation of the entire group and polarization, reduced productivity on job performance, psychological and physical injury, emotional distress and inability to sleep, interference with problem activities, escalation of differences into antagonistic position and malice, and increased hostility (Akanji, 2009). Through conflict management, a cooperative atmosphere is created for promoting opportunities and movement directed towards non violent, reconciliation or basic clashing interest.

No matter how one looks at conflict, it is important to realize that conflict management is one of the best ways in the world to turn the tide and improve unsatisfactory conditions. As a matter of fact, at times there may be no real dispute to be managed but there may be need for greater understanding, cooperation and team work to promote interpersonal harmony and good organizational climate for teaching and learning. Therefore, conflict should not always be seen as something undesirable but rather as a necessary outcome that can bring positive consequences if properly managed. It is against this background that it becomes pertinent to examine conflict management and employees performance in selected soft drink firms in Edo states.

1.2       Statement of the Problem

The study which focuses on conflict management and employee performance in selected soft drink firms in Nigeria is associated with many problems, however this study tends to investigate the many challenges that may arise from the emergence of conflict management in an organisation such as the failure to apply withdrawal method as a conflict management strategy that hinders the organisational growth, it also faces the challenges of the failure to apply confrontation as a strategy  for business survival and finally it faces challenges of the failure to apply compromising as a conflict management strategy on firm competitiveness.

1.3       Research Questions

The following research questions were raised by the researcher:

1. What is the effect of the application of withdrawals method as a conflict management strategy on organisational growth?
2. What is the effect of the application of compromising as a conflict management strategy on firm competitiveness?
3. Does the application of confrontation as a conflict strategy have any effect on business survival?

1.4       Research Objectives

The main objectives of this study are as follows:

1. To ascertain the effect of the application of withdrawal method as a conflict management strategy on organisational growth.
2. To ascertain the effect of application of compromising as a conflict management strategy on firm competitiveness.
3. To ascertain the effect of the application of confrontation as a conflict management strategy has any effect on business survival.

1.5       Research Hypothesis

1. H₀: There is no significant relationship between the application of withdrawal method as a conflict management strategy and organisational growth.

            H_I: There is a significant relationship between the application of withdrawal method as a conflict management strategy and organisational growth

2. H₀: There is no significant relationship between the application of compromising as a conflict management strategy and firm competitiveness.

            H_I: There is a significant relationship between the application of compromising as a conflict management strategy and firm competitiveness.

3. H₀: There is no significant relationship between the application of confrontation as a conflict management strategy and business survival.

            H_I: There is a significant relationship between the application of confrontation as a conflict management strategy and business survival.

1.6       Significance of the Study

The importance of this study is to identify the conflict management strategies in selected soft drinks firms in Nigeria, knowing the cause of such conflict between workers and the management, the effect of such conflict on the overall management of the industry and the likelihood of avoiding such conflict.

Also to help the management and workers to recognize the destructive nature of conflict carried too far, too long and also the positive and creative values inherent in conflict.

To also educate the managers on what should be their attitude at such a time when there is interpersonal conflict so that they might use the best method of compromising with workers so that some degree of satisfaction can be brought to the aggrieved parties.

Also this research will help the managers in the soft drink firms industries to have effective control and co-ordination over their workers and subordinates, which will eventually lead to maximum and efficient productivity.

Finally this research will be as a guide for future researchers who intend on carrying out related studied on this topic as it will serve as a guide for empirical analysis

1.7       Scope of the Study

            The scope covers the areas of conflict management and organisational performance and this study shall Nigerian bottling company and Seven Up bottling company as the organization of study.

1.8       Limitation of the Study

            The following limitations were encountered by the researcher during this research work:

1. Limited Time: The time available for the collection of data for this study from some selected soft drink firms in Edo State was not enough due to the combination of the research work with other Academic activities.
2. Finance: Finance was another difficult aspect of the work as money was needed to source for materials / data and to and from the case study
3. Bureaucracy: Bureaucracy which is a vital part of getting information also posed to be a major problem as staffs/customers of soft drink firms in Edo state were reluctant to give vital information.

1.9       Organization of the Study

The study is organized in five (5) chapters and they are as follows:

The first which is the introductory part of the research covers the background of the study, statement of the problem, research aims and objectives. Questions were also raised in this chapter to guide the research, and hypothesis formulated in this regards. The Second chapter contains the literature review. It reviews the scholarly opinion in the area under investigation. Various theories were also explored in order to have a better understanding of the role of conflict in the organization. Chapter three (3) focuses on the research methods. The procedures and methods of administering, collecting, collating and analyzing the data gather were stipulated. Chapter four (4) examines the data presentation and analysis of the study. In this study, both the percentage and correlation analysis would be employed by the researcher to analyze data for the study. Lastly, a chapter five (5) concludes and summarizes the study. Recommendations will also be made as to how organization can avert crises and improve on productivity.

1.10     Organizational Corporate Profile (History of Nigerian Bottling Company & 7up Bottling Company)

Brief History of Nigerian Bottling Company

The Nigerian Bottling Company Plc has its parent company as coca-cola international company, which was founded in 1892 in Atlanta Georgia, United States of America (by Asa Griggs Candler). The company was incorporated in Nigeria to carry on the manufacturing and marketing of coca-cola brand of soft drinks it started in Nigeria in 1953 by holding franchise for coca-cola company of America. This means that the formula for the concentrates and receipts for the production of coca-cola soft drinks were not released to the Nigerian Bottling Company, but the formulae for the mixture of syrup were given to it for bottling the products in Nigeria.

Nigerian Bottling Company Plc started its operations in Lagos where it established its first plant. Later it spread its plants and depots all over the country. Today it has many production plants and marketing depots dotted over many cities in Nigeria. Such cities include Onitsha, Owerri, Aba, Enugu, Ibadan, Umuahia, Kano, Apapa, Ikeja, Benin City and many other places. They started production by producing only one brand of flavour coke. This was the major project and is still a brand liked by almost every customers of Nigerian Bottling Company Plc. As at now, the company has more than twenty brands of products. The Coca-Cola Company (Nigerian Bottling Company Plc Ngwo Enugu) offers these products to the customers. Diet coke, Fanta, 5 Alive, Sprite, Soda Water, Eva table water etc are the products it produces in order to compete with their competitors. The Nigerian Bottling Company has many departments as follows production, quality assurance, finance, Workshops, human resources, ware house, sales, depots, maintenance, information system and process system. The production department is divided into two sections – the carbon dioxide section, which manufactures carbon dioxide for carbonizing soft drinks and the products section which does the actual production of soft drinks by mixing the right proportion of syrups to bring the finished products. The Nigerian Bottling Company is the largest producer of carbon dioxide for the production of soft drinks in Nigeria. The quality of it’s unequaled efforts plus good network of distribution account for the success of the company in Nigeria. From available records, the Nigerian Bottling Company Plc is definitely a market leader in the soft drinks industry. It is the largest manufacturer and marketer of soft drinks in Nigeria.

The company has contributed a lot to the growth of the Nigerian economy. As part of this contribution, the company has branched out into non-soft drinks business in such area as agriculture and investing in other manufacturing companies like production of pure water. The coca-cola in Nigeria is one of successful and growing Multinational Corporation in the country. The company (coca-cola international company) made 23.1 billion U.S.D 2005, and they make more than 60% of soft drinks consumed in Nigeria.

Brief History of Seven Up Bottling Company

Seven-Up bottling company Plc is one of the largest independent manufacturer and distributor of the well-known and widely consumed brands of soft drinks in Nigeria. Their brands are Pepsi, 7UP, Mirinda, Teem and Mountain Dew, they produce and market in all their present 9 manufacturing plants. They also market their products through their over 200 distribution centres that can also be called depots spread over the nooks and crane of Nigeria. Their workforce is currently in the neighbourhood of 3500 employees. Its head office in Nigeria is located at 247, Moshood Abiola Way, Ijora, Lagos, P.O. Box 134, Apapa, Lagos. A Lebanese Mohammed El-khalil who came to Nigeria for the very first time in 1926 founded the company. Mohammed is the father of the company’s current chairman Faysal El-Khalil. The company metamorphosed from a very successful transport business (El-Khalil Transport) in a bid to diversify the then largest transport company in the entire West of Africa. On October 1st 1960, the exact day this great country Nigeria won her independents, Nigerians also experienced the birth of a soft drink giant as the first bottle of 7Up rolled out from the factory located in Ijora. Since then, the company continued to grow in the leap and the bound. In the late 80s, they also established two more plants in Ibadan and Ikeja. In the early 1990s when Pepsi International took over 7Up international, they again got great opportunities to introduce the Pepsi brand to the Nigeria people. As at today, the company has its Headquarters in Beirut and operational bases in three African countries, namely Nigeria, Tanzania and Ghana.

Around 1920, while Dr Pepper was growing in favor, C.L. Grigg, an advertising veteran of 30 years, had formed the Howdy Company in St. Louis, Missouri. The company was named for the Howdy orange-flavored soft drink Grigg had developed, but the CEO had other ideas–specifically, to invent a new flavor of beverage. For two years, Grigg tested different combinations of lemon and other flavors. By the mid-1920s he had settled on a distinctive lemon-lime formula and in 1929 the Howdy Company introduced the soda to the general public.

Grigg and company were confident of their invention’s appeal. As an early sales bulletin noted, consumers ‘are tired of the insipid flavors, and the aftertaste of the heavy synthetic flavors is more objectionable. … So in our beverage we have provided seven natural flavors so blended and in such proportions that, when bottled, it produces a big natural flavor with a real taste that makes people remember it.’

The only thing that might have stood in the way of the drink’s early success was its name, ‘Bib-Label Lithiated Lemon-Lime Soda.’ Griggs derived the new and much simpler name, 7 Up, from the beverage’s ‘seven natural flavors.’ The new name first appeared on the bottle later in 1929. The beverage sold well, and the new name made it easy for consumers to remember. In 1936, the Howdy Company became the Seven-Up Company, and by the 1940s its product became the world’s third largest selling soft drink.

1.11     Operational Definition of Terms

1. Conflict: The word ‘conflict’ can be defined as a controversy or dispute between workers and management in order to open up an issue in which the end result may either be positive or negative. Conflict includes fighting between employees as a result of non-implementation of employment terms.
2. Compromising: This is searching for solution that brings some degree of satisfaction to the conflicting parties.
3. Forcing: Exerting one’s view point at the potential expenses of another often open competition and a win-loss situation.
4. Confrontation: Addressing disagreement directly and in a problem solving mode- the affected parties work through their disagreement.
5. Withdrawal: Retreating from an actual or potential conflict situation.
6. Productivity: Productivity is defined as the measurement of output of labour hour during a production process.
7. Competing: This style of conflict power oriented and approaches conflict in terms of a loss strategy.
8. Accommodating: This style of conflict is low in assertiveness and high on cooperativeness.
9. Avoiding: An avoiding style may appear to have no as a mode meaning conflict. An avoiding style reflects a failure to address important issues and a tendency to remain natural when there is need to take a position.
10. Strike: Strike according to trade dispute (emergency provision) decree, is a cassation of work and it include deliberately working at less than usual hours or with less than usual efficiency. Strike is a concerted withholding of labour supply in order to bring economic pressure to bear upon the employer to cause him to grant employees demands.
11. Lock Out: This involves the shutdown of a place of business by management in the cause of labour dispute with employers for the purpose of forcing workers to accept management terms of agreement.
12. Collaboration: The collaborating style is higher on both dimension of co-operation and assertiveness.
13. Management of an Agreement: The condition of agreement already exists between the management and the workers.

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