The extent to which integrators felt they were evaluated and rewarded in accordance with the overall performance of their product group was the third factor that we expected could be related to their effectiveness in resolving conflicts.4 If the integrators felt that their superiors were evaluating them on the basis of the profitability of their product group or on a similar overall standard of performance, they would be more motivated to work at achieving integration. Since, as we have pointed out, all of these integrators had some other responsibility in addition to integration (e.gsupervision of development activity or marketing planning), when they felt that their own individual performance or the performance of their subordinates was the most important factor in their evaluation, they might devote less effort to purely integrative activities.
Information about the importance of different bases of reward in each organization was collected as part of the questionnaire.* The integrators in the two low-performing organizations reported that, for them, the total product-group performance was significantly less important as a basis of evaluation than did their counterparts in high-performing organization B and medium-performing organization A (Table III—2). Interestingly enough, the integrators in the two low- performing organizations also reported that their own individual performance was a significantly more important factor in their superiors’ evaluation of them than did the integrators in the other organizations. These data suggest that the integrators in the organizations with the most problems in achieving the required states of both differentiation and integration were less concerned with the superordinate goals of total product performance than were their counterparts in the other organizations. The integrators in high-performing organization B and medium-performing organization A were probably most concerned about these goals, since they indicated that this was a significantly more important factor in their evaluations, while the integrators in high- performing organization A and in medium-performing organization B were concerned to a moderate extent with these superordinate product objectives.
Integrators in these four organizations were apparently getting either explicit or implicit signals from their superiors that a relatively important part of their job was to contribute to the overall performance of the products for which they were responsible. In the low-performing organizations this particular incentive to work at the resolution of conflict was not so noticeable, which may have contributed to the difficulties these organizations encountered in achieving the required state of differentiation and integration.
So far we have reported on three determinants of effective conflict resolution which are especially related to the behavior of the integrators—intermediate orientation and structure; high influence based on competence and knowledge; and the presence of incentives for conflict resolution. Each of these three factors has to some extent discriminated among the more effective and the less effective organizations. As we have already indicated, our interest is not in whether any one or two factors distinguished the high-performing organizations from the lower ones, but rather in the total configuration of the several factors that seem to determine how effectively conflict is handled in an organization. Before we can examine the overall pattern of these determinants of effectiveness, we need to consider three other factors that had an impact on the decision-making behavior of the functional specialists as well as that of the integrators.
Source: Lawrence Paul R., Lorsch Jay W. (1967), Organization and Environment: Managing Differentiation and Integration, Harvard Business School.