Human Capital Review - Managing the Costs of Conflict… A Novel Idea

Managing the Costs of Conflict… A Novel Idea - Calculating the Cost of One Conflict in Your Organisation

The following worksheet will help you to calculate the cost of conflict in your workplace. Use it to get an idea of just how costly just one conflict can be. Complete as much of this form as possible. You may not know all the answers, so feel free to make educated guesses.

COST OF ONE CONFLICT WORKSHEET
Describe a significant or ongoing conflict in your workplace (you do not need to be directly involved):
Estimate the combined number of hours these people spend on the conflict on a weekly basis (include the time spent complaining and gossiping about the people involved in the conflict):
Number of people involved
Number of hours in one week	X
Weekly hours of lost productivity owing to conflict	=
Average hourly wage of people involved	X
Weekly compensation	=
Estimated number of weeks	X
Subtotal: Cost of time	=
If this conflict has (or could) lead to turnover, multiply the annual compensation of each person who has left (or who may leave) the organisation by 150%:
Number of employees who could leave
Estimated average salary	X
Subtotal	=
Cost of turnover (150%)	X 1.5
Subtotal: Cost of turnover	=
Estimate the actual and potential costs of reduced decision quality, disengagement, sabotage, and increased health care needs related to this conflict:
Potential legal and HR costs
Lost business, missed opportunities, sabotage, absenteeism, etc.	+
Subtotal: Other costs	=
Use the subtotals to calculate the total cost:
Cost of time
Cost of turnover	+
Other costs	+
Total cost of one conflict	=
Can your organisation afford the cost of conflict?

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