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CONFLICT AND DIVIDED LOYALTY IN THE DECIDER SUBSYSTEM

Lane Tracy
Department of Management Systems
Ohio University
Athens, OH 45701

Abstract

Conflict is inherent and unavoidable in a living social system, because the individuals who comprise its decider subsystem face divided loyalties. They must make decisions for the system, for themselves, and often for component groups or organizations, as well. Additionally, decider processes at any echelon may be divided and shared among two or more individuals. Conflict is generated in individuals because (1) they must represent the sometimes incompatible interests of two or more living systems, (2) they must often share leadership, and (3) they receive incompatible commands from two or more levels of the hierarchy. Such conflicts are often managed by compartmentalizing decisions and by attempting to make the various interests consonant. It appears, however, that the best strategy is to encourage a moderate amount of pluralism in the values of the various systems and subsystems, coupled with a set of checks and balances to assure that all interests are adequately represented.

Keywords: conflict, decider subsystem, living systems, leadership, loyalty.

Introduction

Suppose that you are the general manager of a small firm that makes auto parts for Ford. The owners of the firm, some of whom are also members of your family, hold you responsible for making a profit and generating income. You also feel responsibility toward your employees, many of whom have been with the firm all of their adult lives. Your own income and the livelihood of your spouse and children are likewise dependent on your decisions.

In addition, Ford depends on you to deliver high-quality parts on time. The firms that supply raw materials to your firm look to you for continued orders. The bank that gives your firm a line of credit depends on you to repay the loans. Also, you may feel a sense of loyalty toward your community, your nation and your religion. Is it possible for you, as leader of the firm, to make decisions that represent all of these diverse interests?

The various individuals, groups, and organizations that hold an interest in your firm are called stakeholders or constituencies [2,5]. One modern approach to the assessment of organizational effectiveness, the multiple-constituency approach, measures the success of the firm according to how well it serves each of these constituencies. Table 1 lists constituencies and displays some of the criteria that each might use to measure effectiveness of the firm.

Constituency Effectiveness Criteria
1. Owners Financial return, growth
2. Employees Work satisfaction, pay, supervision
3. Customers Quality of goods and services, price
4. Creditors Credit rating, assets
5. Community Contribution to community affairs
6. Suppliers Regular orders, good price
7. Government Obedience to laws, regulations, taxes

Table 1. Effectiveness criteria used by various constituencies [1].

It is obvious that the firm, and you as its leader, cannot serve all constituencies equally well. When the interests of various constituencies diverge, you must make some hard choices. Much strain and conflict, both within and between systems, may be generated by these choices.

Leaders of social systems are the focus of conflicting interests. Consequently, leaders play a primary role in the management of conflict, both within the systems they lead and between systems. Leaders make key decisions that can either resolve conflict or intensify it. Yet leaders are often in a state of internal conflict with regard to whom they represent.

Leaders are expected to make decisions for the benefit of the particular group, organization, community, or society that they lead. Yet they must also make decisions for their own benefit. In addition, they may be the chief decision makers for a family, a political party, a subgroup of owners or executives, and so forth. What effect does this divided loyalty have on the ability of leaders to manage conflict? How can social systems be structured to manage the conflicts that leaders face within themselves?

Leadership and Living Systems

The foundation of my approach to leader decision-making and conflict management is Miller's living systems theory. Miller found that all living systems Possess a decider subsystem, which he defined as "the executive subsystem which receives information inputs from all other subsystems and transmits to them information outputs that control the entire system" [4:67].

The decider of any complex living system is hierarchical and has many echelons. The decider subsystem of mammals, for instance, has nine echelons ranging from the cerebral cortex at the top to the endocrine glands and certain neurons at the bottom. Similarly, large organizations have echelons such as a board of directors, chief executive, vice presidents, managers, department heads, Supervisors, and operative employees. A typical organization chart is essentially a diagram of an organization's formal decider subsystem.

Decision making occurs at all echelons of the decider, although the decisionmaking domain becomes narrower as we move downward in the hierarchy. Processes of the decider subsystem include:

1. establishing purposes and goals for the system;
2. receiving and analyzing information from all subsystems and components (and thence from the environment);
3. synthesizing the data in order to narrow the range of alternatives into a choice of actions; and
4. implementing the choice by transmitting commands or other forms of information that will cause other subsystems and components to carry out the chosen processes [8:140].

It should be evident that these decider processes, taken in the context of a social system, constitute what is generally expected of a leader. That is, a leader sets goals for the system, analyzes alternatives, makes choices, and issues orders to implement those choices.

Some writers on leadership emphasize the goal-setting aspect, picturing leaders as visionaries and guiding lights. Other writers focus on the choices that leaders make; good leaders are those that make effective or popular choices for the system. Still others see leadership primarily in terms of implementation; leaders display the skills of persuasion that are necessary to induce other people to work for the system's goals [1:5-16].

In my opinion leadership includes all of the decider processes for a social system. Analysis and choice without clear goals is dangerous. Planning without implementation is useless. A single person may not be able to supply all of the decider processes, but the system requires leadership that, collectively, provides all of these processes. Thus, I define leadership as "purposeful assumption of some or all of the processes of the top echelon of the decider subsystem for a group, organization, [community], society, or supranational system" [8:41]. There are many other definitions of leadership, but this one has the advantages of being rooted in living systems theory and of providing a more complete picture of leadership.

Conflict and Living Systems

Miller defines conflict as a strain arising within a system when it receives two or more incompatible commands [4:39]. For example, two groups of stockholders may make incompatible demands on the CEO; three customers may simultaneously demand service from a clerk; two departments may both require most or all of the organization's available research funds; a buyer may demand a bribe that violates the sales representative's ethical values. Note that the incompatible commands may come from self, suprasystems, subsystems, same-level systems or any combination of these, and the strain may be felt by the whole system or any component of it.

As issuing commands is one of the processes of leadership, it can be seen that leaders often generate conflict. Elsewhere I have identified three characteristics of living-systems leadership that tend to cause conflict:

1. each level of a complex social system has its own leadership;
2. leadership of a social system may be shared by two or more leaders;
3. leaders are living systems in their own right [8:142-49].

Let us examine each of these conflict-generating characteristics in turn.

Multiple levels. Complex social systems are composed of subsystems and components, such as departments, bureaus, and political subdivisions, that are also living systems. Leadership of an organization as a whole may come from a CEO or president, but each department and bureau within the organization has its own leader(s). Such multiple levels of leadership are an obvious source of conflict, because leaders at each level are making decisions and issuing commands based on the goals and purposes of their own system.

For instance, a sales manager may issue a command to travelling sales representatives to increase the number of calls they make, thereby increasing sales and commissions; simultaneously, the CEO may command the representatives to spend more time with each client in order to improve service. Both leaders may be attempting to serve what they perceive as needs of the organization, but they have different perspectives on what those needs are.

Leaders not only generate conflicting commands from different levels of the organization, but also receive them. For instance, a production supervisor may receive orders from the comptroller to economize and from the vice president of marketing to maintain more finished units in inventory. Or the supervisor may receive orders from above for increased production while hearing demands from employees for a decrease in overtime. The different perspectives of suprasystems and subsystems are a source of myriad strains.

Shared leadership. The four processes of leadership may be divided and shared in a number of ways. The board of directors may set goals, staff members may analyze data, and the CEO may then make a choice and issue orders. Leadership may fall to a group (e.g., an executive committee) or be exercised equally by partners in a business. Although the individuals and groups who share leadership may cooperate with one another, the fact that they are separate living systems with their own purposes and goals means that some conflict among coleaders is inevitable.

Shared leadership engenders conflict when co-leaders issue incompatible commands to each other or to subsystems and components. When the President of the United States says there will be no new taxes and the Congress demands new taxes to balance the budget, a great deal of strain is generated in the nation. Similarly, strain is generated in employees when two partners who are joint owners of a firm give the employees incompatible tasks to do.

Divided loyalty. The fact that leaders are living systems means that every social system must share its leader (and other echelons of its decider subsystem) with at least one other system. Leaders must make decisions for themselves as well as for the social systems that they lead. In some cases a person is also leader of two or more social systems. For example, the Prime Minister of Japan is leader of both a nation and a political party.

This sharing of the leader/decider by two or more living systems causes two different sorts of problems. First, the attention of the leader may be elsewhere when the social system requires it. Second, the loyalty of the leader may be divided by incompatible demands of the two or more systems that he/she serves.

Divided loyalty creates conflict within leaders. Assuming that they don't simply abandon leadership of the social system and act for personal gain, leaders must somehow reconcile the conflicting demands of self and social system(s). This is somewhat similar to conflict between a person's values and his/her defined role in a social system. But leaders are at least partially responsible for defining the leader's role as well as the organizational values and goals on which a decision for the organization should be based. Thus, both role demands and values come from within the person.

Managing Leadership Conflicts

Leaders generally try to avoid or manage shared-leadership and multiple-level conflicts by defining clearly the domains of decision making for each position of leadership. For example, the legislative branch of government establishes the laws and the executive branch implements them. One business partner handles the finances while another deals with personnel and operations. One manager handles the day shift and another the night shift. Supervisors makes daily work assignments, but the department manager is in charge of long-range production scheduling.

Such compartmentalization of responsibilities greatly reduces the potential for conflict, but does not eliminate it. The activities of any living system must be closely integrated. Thus, the decisions of multiple leaders, however they may be compartmentalized, must be closely coordinated. In a hierarchically-organized system the top echelon typically provides coordination, backed by power and authority. Coordination may be attained in cases of shared leadership by devices such as frequent communication, meetings, consensual group decision making, negotiation, and mediation, or by elevating one of the leaders to a position of greater authority.

Compartmentalization is also employed by leaders to manage conflicts generated by divided loyalty and opposing interests. Leaders often try to avoid taking their work home with them. At the office they make decisions for the sake of the organization; at home or on lunch break they make decisions for themselves or the family. They make organizational decisions based on organizational values and personal decisions based on personal values.

The success of this strategy depends on how well leaders are able to compartmentalize their lives and employ different values at different times. Leaders are often criticized for abandoning their personal values when they act for the organization, yet living systems analysis suggests that such compartmentalization is necessary. Temporal compartmentalization may also require that a deputy leader by designated to make decisions in the leader's absence, lest the organization be left headless.

Compartmentalization becomes increasingly difficult as the demands of one system become more insistent. The owner of a business or the president of a nation may find that "his time is not his own." When a leader's health or marriage is threatened by overwork, he or she may find it difficult to maintain the separation of domains.

Many writers on leadership have noted that great leaders often emerge in times of crisis. One explanation of this phenomenon is that a crisis in the nation or in the organization causes its leaders to focus their attention on the needs of the social system and to subordinate their own needs.

In ordinary times leaders must establish priorities in order to manage the conflicting demands of social systems and self. When the demands of all systems cannot be met, the leader must choose which master to serve first. Many leaders choose to serve their own interests first, if such a choice must be made. That is, temporary or permanent abandonment of the leadership role is a primary mode of conflict management for leaders, Leaders who subordinate their own interests to the good of the social system are deemed heroes, because such behavior is uncommon. How, therefore, can social systems protect themselves from abandonment by their leaders in times of conflicting demands?

Leaders often try to manage this abandonment problem by establishing organizational or societal values that are consonant with personal and family values. A business owner may try to establish an organizational culture based on personal values. A political leader may use the media to impart personal values to the populace. To the extent that leaders are able to attain personal goals through decisions based on social system values, abandonment of leadership becomes unnecessary.

Social systems also try to choose or develop leaders who embody the values of the group, organization, community, or society. Japanese systems of management, emphasizing lifelong employment and slow promotions, may be seen as elaborate methods for developing top managers who are infused with the spirit and values of the company [6]. In a democratic society the voters tend to elect leaders who espouse values similar to their own. Research on the link between group leaders and conformity to group norms has found that leaders are high in conformity, both because leaders tend to influence the norms and because groups tend to choose leaders who embody the existing norms [1:430].

Another method of resolving the conflict in favor of the social system is to make the rewards of leadership so attractive that the leaders' interests become fused with those of the organization. Societies sometimes crown their leaders, making the nation a personal kingdom of the leader. Corporations generally attempt to structure the rewards of the CEO and other corporate leaders so that decisions which benefit the corporation also benefit the leaders.

This method of conflict management may backfire, if not handled carefully. It breaks down the compartmentalization between personal decisions and decisions for the social system. The leader may begin to think that all national or corporate values are consonant with personal values. Decisions then are based on the belief that “what is good for me is good for the company (or nation)." Because the individual and the social system are separate and distinct living systems, however, this belief cannot be true. There may be much convergence of interests, but there must also be divergent interests.

Dictatorships and owner-managed business firms often deteriorate or become involved in harmful conflict with other systems precisely because the leader is unable to distinguish between personal interests and those of the social system. A dictator who feels personally threatened may dedicate excessive societal resources to defense. A business owner who is nearing retirement may lose interest in maintaining the vitality of the business or providing for management succession.

Eliminating conflicts caused by the divided loyalty of leaders does not seem to be the best method of conflict management. As with other forms of conflict, there may be benefits both to the social system and to the leader in maintaining a moderate degree of conflicting interests and values. Organizations often gain from infusion of different values from new leaders, particularly if the environment is changing [7].

Checks and Balances

To avoid problems such as these, successful social systems have developed checks and balances that moderate the power of leaders and subsystems. Pluralism of interests and values is encouraged. No leader is given absolute control, nor are leaders encouraged to identify themselves completely with the social system. Instead, leadership processes are divided and shared, as in the division of responsibilities between a corporate CEO and the board of directors, or the division of powers in the Constitution of the United States of America. Leaders are required to consult with each other, to negotiate, and to obtain consent before acting on behalf of the social system. Control processes operate to monitor leaders' decisions and their consequences. A set of corporate policies or laws exists to offer formal guidelines for decision making and to provide a basis for adjudication, if necessary. Dynamic tension among conflicting interests is maintained and becomes a source of strength in the living social system.

Specifically with respect to the problem of divided loyalty of leaders, conflict management strategy should be based on understanding that it is neither possible nor desirable to eliminate this source of conflict. Leaders must represent both themselves and the social systems they lead, and their interests cannot fully coincide with those of the social system. A degree of strain generated by differing values, purposes, and goals is healthy both for social systems and for their leaders. Social systems should not expect absolute loyalty from leaders or any other part of the decider subsystem, but should provide a set of checks and balances whereby conflicts can be discussed, negotiated, adjudicated, and controlled. If this set of checks and balances works properly, the strain on leaders will not become excessive.

Summary

Examining the topics of conflict management, decision making, and leadership from the viewpoint of living systems theory, we find that conflict is inherent and unavoidable in living social systems because of certain characteristics of their decider subsystem. The decider subsystem is composed of several echelons corresponding to levels in the hierarchy of the social system. At each echelon choices are made by people or groups for the benefit of the social system. However, these people or groups are living systems in their own right and must also make decisions for themselves. Additionally, they may be leaders of subsystems and may be required to make decisions based on subsystem values, purposes, and goals. Finally, decider processes at any echelon may be divided and shared among two or more leaders.

Conflict is generated in leaders because (1) they must represent the sometimes incompatible interests of two or more living systems, (2) they must often share leadership, and (3) they receive incompatible commands from two or more levels of the hierarchy. Such conflicts are often managed by means of compartmentalization. Leaders represent different systems at different times and places, decision processes are divided and assigned, and decision-making responsibilities are defined for each echelon. Another conflict-management strategy is to attempt to make the various interests consonant. It appears, however, that the best strategy is to encourage a moderate amount of pluralism in the values of the various systems and subsystems, coupled with a set of checks and balances to assure that all interests are adequately represented.

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[2] T. Connolly, E. J. Conlon, and S. J. Deutsch, 1980, "Organizational effectiveness: a multiple-constituency approach." Academy of Management Review, Vol. 5: 211-217.

[3] R. L. Daft, 1989, Organization Theory and Design, Third Edition. St. Paul: West Publishing, p. 105.

[4] J. G. Miller, 1978, Living Systems. New York: McGraw-Hill.

[5] I. 1. Mitroff, 1983, Stakeholders of the Organizational Mind. San Francisco: Jossey-Bass.

[6] W. G. Ouchi and A. M. Jaeger, 1978, "Type Z organizations: Stability in the midst of mobility." Academy of Management Review, Vol. 3: 305-14.

[7] G. R. Salancik, B. M. Staw, and L. R. Pondy, 1980, "Administrative turnover as a response to unmanaged organizational interdependence." Academy of Management Journal, Vol. 23: 422-37.

[8] L. Tracy, 1979, The Living Organization. New York: Praeger.