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Posted on March 27th, 2012, by

In actuality, the conflict of interests between shareholders and employees of IBM is one of the major and most dangerous conflicts, although this conflict of interests is similar to the conflict of interests between employees and managers. In this respect, it is important to place emphasis on the fact that, unlike the conflict of interests between employees and managers, the conflict of interests between employees and shareholders lacks the direct communication between employees and shareholders. In fact, shareholders communicate with employees via managers, who perform the function of mediators. In such a situation, the natural desire of employees to have better conditions of work and higher wages come into conflict with interests of shareholders, who want to increase the profits, even at cost of poor conditions of work and wages of employees. For instance, shareholders can insist on cutting costs on the labor force through reducing wages or job cuts, if such a decision increases their profits.

Naturally, employees oppose to such policies and, in contrast, they insist on the improvement of conditions of work and higher wages.

Another serious conflict of interests can arise between employees and customers of IBM. In this regard, it is worth mentioning the fact that customers are always interested in the high quality of products and low price of a product.

However, this means that employees need to work hard to create products of the high quality, whereas conditions of work remain unchanged to save costs of production. As a result, grow dissatisfied with their position, whereas the insistence of customers on the necessity to produce products of the high quality remains unchanged. In addition, customers can easily refuse from buying products of the company that puts under a threat the position of employees, whereas employees are interested in sales of their products en masse. For instance, if employees manufacture products of a poor quality because of poor conditions of work, customers refuse to buy these products and the position of employees deteriorates even more because the company has little resources to improve conditions of work. Instead, the company can start saving costs cutting jobs or using other tools that deteriorate the position of employees.

Possible solutions to the conflicts of interests

Obviously, the conflicts of interests need effective solutions. In this regard the conflict of interests between employees and shareholders can be solved through sharing dividends with employees. What is meant here is the fact that employees should get their share in the company that will motivate them to work better and to improve their performance that will increase revenues and profitability of IBM. In such a way, interests of shareholders and employees will coincide.

As for the conflict of interests between employees and customers, the training of employees to develop positive models of communication with customers can help to prevent this conflict because employees will able to communicate with customers effectively. Hence, customers will understand employees better as well as employees will understand customers better too. The mutual understanding of employees and customers will balance the quality of products manufactured by employees and the buying power of customers. In such a way, the risk of the conflict of interests between customers and employees can decrease consistently.

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