What is conflict costing you?

What is conflict costing you?
June 16, 2017 Ken Ashdown
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There is always a price to be paid when conflict goes unresolved, or is poorly handled. The key question is, how much is it costing you and your creative team or organization?

In war, its most extreme form, the value of buildings, businesses, and infrastructure destroyed, never mind lives lost, quickly reaches billions of dollars. Even low-level, interpersonal conflict in the creative industries can exact a shockingly high toll on those afflicted. Unlike war, however, much of the expense is hidden, manifesting as other issues or symptoms. The “collateral damage” is still significant, and it’s tragic because it’s arguably the single most preventable expense in the workplace.

It’s hard to cite accurate figures precisely because the costs are disguised, but in 2005, Section 207 of the Canadian Public Service Labour Relations Act mandated that all federal government departments and agencies install mechanisms for employees to access alternative dispute resolution (ADR). Why? Because costs of harassment and grievance complaints for Canada’s single largest employer (i.e., the public service) were found to be dramatically reduced when effective conflict resolution processes were made available.

Conflict in the arts & entertainment business produces all kinds of expensive, unwanted drama that can play out behind the scenes (and sometimes, in the media). When it comes to the creative industries, the costs of conflict are alarming. A selective list includes the following:

 

Absences due to stress/health. Record companies, game developers, movie studios, and ad agencies — among other creative organizations — all suffer from absenteeism arising from one person’s unwillingness or inability to deal with another at work. An April 2016 story in Canadian Business noted that “according to a recent study from Willis Towers Watson, highly stressed Canadians take nearly 50% more sick days than their blissed-out peers.” Some absences result from genuine physical complaints related to stress, such as headaches, nausea, or other symptoms. Chronic lateness can stem from a subconscious desire to avoid conflict, or the need for restorative sleep after stress. Conflict can have knock-on impacts on those covering for absent coworkers and taking on extra responsibilities. This can result in even more stress and anxiety, perpetuating the cycle. Medical care, prescriptions, and physiotherapy all add up, whether the costs are covered by the individual or borne by an insurer.

Drug or alcohol abuse, another cause of absenteeism, could indicate a coping mechanism to deal with the stress and anxiety of conflict. Some creatives get high to escape, dull the pain, or avoid the harsh reality of interpersonal issues. The costs of treatment for addiction and the side effects of substance abuse must be factored into the equation.

Related mental health issues. The expense of counselling or therapy to help manage the fear and anxiety of a conflict can be as prohibitive as treating the physical symptoms.

Reduced productivity and production delays. Conflict drains energy and wastes valuable time. Output is diminished when individuals ruminate and fret over difficult conversations; teams waste precious resources bickering unproductively; and organizations face potential cost overruns. This is especially true in film and television, where every minute’s delay can cost thousands, or even millions when funding and delivery deadlines are at risk.

Role confusion or disruption. Conflict between formal or informal roles can inhibit productivity and cause other direct or indirect losses. Some duties or tasks might be abandoned if they lead to internal struggles. This may appear less of an issue on film sets where job functions are highly specialized, clearly defined, and critically interdependent, yet it’s surprisingly common. It’s arguably worse for indie productions where creatives wear multiple hats and the traditional hierarchy is less rigidly enforced.

Role conflict occurs frequently in larger organizations such as studios, agencies, labels, and so on. Conflict resulting in denial of individuals’ voting rights or other powers and privileges can have significant financial impact.

Sabotaged or destroyed work. Sometimes, frustrated artists erase recordings or destroy video footage. (Dexys Midnight Runners famously ransomed the master tapes for its debut album in a dispute with their label, EMI.) Code can be deleted and computers deliberately infected with malware. Gigs get cancelled when band members walk out. Sets can be smashed. The added security to prevent such things isn’t cheap. Every sector of the creative industries has its own legends, and the stories are both truer and more common than we think.

Loss of uniquely skilled team members. With rare exceptions, everyone suffers when a key creative leaves. The Velvet Underground kept going, but lost a vital ingredient to their signature sound when John Cale left; Roxy Music was never quite the same without Brian Eno, or The Clash without Mick Jones. From comedy troupes to screenwriting teams, the losses add up: dejected fans, reduced income, lost creativity.

Auditioning and orientation of new cast/crew/staff members. Hiring, “on-boarding,” and training staff is an expensive HR process for every business, especially when new recruits don’t survive the probationary period. Creative endeavours too: it takes time and effort to find and induct a new team member with just the right combination of skills, attitude, look, and chemistry.

Reduced innovation. Conflict can drain vital energy or rob teams of ideas and input. Contributions may be withheld in fear of judgment or strained relationships. Collaborators may begin stashing their best material for after the writers’ room, studio, or office.

Inferior decisions. Decisions taken just to “get it over with” (or made while creative input is being withheld) seldom last. Choices made once factions form are equally suspect. In either case, the results tend to be short-lived, and subject to much second-guessing; it’s hard to get wholehearted buy-in without proper consensus. (Conversely, conflict that is managed productively can ensure the best group output.)

Inefficient meetings and brainstorming. Most meetings are already ineffective enough. Why add destructive conflict into the mix?

Damaged relationships at home, in society, or the community. Conflict tends to spill over into other domains of life. We bring it home from the office; we enroll friends and colleagues in our drama; we suppress our emotions around it and bystanders suffer the unintended consequences. It’s hard to keep it from manifesting elsewhere, whether in your primary/romantic relationship, at home, or your social sphere, and while harder to quantify, these losses are just as devastating.

Reputation damage. Creative teams renowned for infighting are less attractive to recording, TV, or film deals, especially in a buyer’s market. A pattern of conflict is a warning sign to an agent or manager. Film sets plagued by feuds generate media coverage, but not always the good kind. Companies with “revolving door syndrome” find it very difficult to attract or retain new talent. In an industry based on relationships, few can afford a bad rep. Their marquee value may give some above-the-line talent a pass for bad behaviour, but it catches up with everyone eventually.

Limited (or failed) careers. Most of us can name at least one great act or production that imploded before (or at) its creative and commercial peak. Even the loss of a single member can permanently alter a team’s unique (and highly bankable) creative DNA. The Beatles’ solo career success, and the Rolling Stones’ ability to survive the death or departure of successive band members, are outliers: major exceptions to rule that the whole is greater than the sum of its parts.

Disappointed fans and customers. A basic rule of any business is that customer acquisition is more expensive than retention, and there’s only so much discord, or creative inconsistency, that even the most rabid audience will tolerate. In this Peak Entertainment era, an organization’s customers and clients have plenty of choice, and audiences will also go elsewhere if conflict infects product quality.

Threats to safety or security. When conflict escalates and civility breaks down, so can personal safety and security. Violence is rare, but it can happen onstage as well as off. The costs include potential lawsuits, hospitalization, police interventions, and more.

Collateral economic damage. Labour relations are a whole different dimension. The recent threat of another writer’s strike recalled the longest walkout ever by the film and TV unions & guilds, lasting nearly six months in 1988. By some estimates the U.S. entertainment industry paid the equivalent of half a billion dollars in opportunity costs. The city of Los Angeles alone lost around $1.5 billion in revenues, according to one National Public Radio (NPR) report.

Unmanaged (or mismanaged) conflict isn’t the only major, invisible drain on the creative industries. A dysfunctional (or toxic) organizational culture can also cost a business millions of dollars, as evidenced by the not-so-hidden Fox News harassment scandal. As I write, the story is still unfolding and the price tag keeps climbing; estimates in the tens of millions in settlements don’t even factor in the cost of replacing lost marquee talent.

But for every courtroom or on-set battle in the headlines, many more are being fought away from the spotlight. They may be hidden behind nondisclosure agreements (NDAs) and out-of-court settlements; or they just aren’t as high-profile and newsworthy. Either way, it’s further indication that the true costs of conflict are vastly underestimated.

They’re also very real and significant. There is too much at stake, whether it’s profit, reputation, or career opportunities, to let a conflict simmer at any level. Preventive measures like workplace training or coaching greatly reduce the likelihood of escalations, and dramatically increase the chances of successful (and early) resolution. The personal, professional, and financial costs are simply not worth the risks.

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