It is sometimes (but not always) easy to quantify the cost of mistakes – purchases or investments made that did not pay off, initiatives that were poorly executed, budgets that are underfunded. But what about the very real – but often less evident – costs of people-related problems? An article in the Harvard Business Review discussed results when managers were asked to estimate the time wasted addressing various people-related problems.
Conflict costs money
The most costly and pervasive people-related problems?
• Putting the wrong person in the wrong job
• Working with stakeholders to find mutually beneficial outcomes
• Wasted time and resources in unproductive or poorly-run meetings
• Leaders who do not inspire or lead
Also high on the list were:
• People ignoring critical problems in-order-to avoid conflict
• Putting off or being afraid to make critical decisions
• Failing to creatively consider other solutions – just sticking with familiar options
It is clear that conflict costs money. The article cites another study of American companies that found that it costs industry approximately $359 billion/year in paid hours to address conflict. They found 25% of employees reporting that conflict at work has resulted in sickness or being absent and 10% reporting that conflict has led to project failure.
Dealing with conflict can save money
Conversely, it is equally clear that dealing with conflict effectively can save money. Using clear-cut transparent processes and the input of key stakeholders can help you:
• Make sure you have the best possible candidate that fits your criteria
• Include stakeholders and address conflict in a meaningful and beneficial way
• Run productive meetings, resulting in clear-cut action plans
• Use a clear set of steps to tackle decisions with confidence
• Proactively identify and address problems
Using a research-based problem-solving process can help combat conflict or provide an alternative way to address each of the issues listed above.
How do you address your “people-problems?”