The Cost of Conflict Incompetence: It Doesn’t Have to Be this Way

Our reaction to real or imagined interpersonal and intraorganizational conflict may be the best measure of our leadership potential.  Failure to turn the energy of conflict into constructive outcomes has doomed many great leaders and turned successful organizations into a shadow of their once successful selves.  Unlike the public outcry about not learning the lessons of the global recession of 2008, the lessons needed are less economic in origin than they are basic leadership skills which no M.B.A course teaches.

JPMorgan Chase’s  recent massive market losses is one such event with lessons to be learned by all great companies and their leaders.  Facing losses now approaching $3 Billion JPMorgan CEO Jamie Dimon has declared the bank’s missteps “stupid” and attributed them to “errors, sloppiness and bad judgment.”  A once invincible bank with America’s “least hated banker” at the helm, JPMorgan now fights for trust among its customers while Jamie Dimon fights for his job.

As the commentators and pundits continue to educate us on the sources of this unimaginable market loss, the irony of leadership lost becomes increasingly clear.  The investment unit responsible for the trades that generated this massive evaporation of market value, was the bank’s chief investment office in London led by Ina Drew.  During the heyday of the bank’s successful navigation of the 2008 recession, Ms. Drew was responsible for managing the London and New York investment officers on a daily basis in a collaborative environment which encouraged difficult conversations about positions taken and the reasons for them.  Strong personalities were nurtured in an accountable culture of respectful dialog and shared conversation under her direction.

However, after she suffered a bout with Lyme disease beginning in 2010, no one else was able to maintain a conflict competent culture.  It is reported that insecure egos began to battle for supremacy and the culture of collaboration devolved into chaotic and disrespectful shouting matches in which sound judgment was suspended because people did not know how to confront in constructive ways.  Trust was lost and mistaken decisions became the hallmark of a once great investment group.

That a single person’s leadership skills made the difference between excellent performance and sloppiness is a telling assessment of the value of conflict competence in today’s competitive global economy.  There is no room for intra-organizational competition among interdependent colleagues.

“Collaboration is harnessed conflict” writes Ross McCammon in the June 2012 issue of Entrepreneur magazine.  Great leaders know how to encourage healthy confrontation and create ground rules for engaged and respectful dialog among high achievers with opposing views.  Passive aggressive behavior has no place in a high performing organization.  Work groups that are unable to “harness conflict” miss the great opportunities because they are ill equipped to challenge the status quo or seize the innovative new ideas.

Successful project management methodologies begin with the premise that conflict will be encountered inevitably when diverse perspectives are brought to bear on solving a problem.  Great work teams first “form”, then “storm” before they “norm” in order to be able to “perform”.  Without storming and norming, there can be no performing.

The presence or absence of conflict competent leadership will become increasingly critical as the global economy permits less and less variance in terms of satisfactory market performance.  Because customers and clients ultimately drive the success of our banks, law firms, hospitals and companies, the capacity to create, maintain and nurture a conflict competent work force will be the measure of those who achieve front runner status.

And those who are successful in achieving it will need to learn how to sustain it.  Conflict competent leadership is not built into a person’s DNA.  It is acquired like all great skills.