MANAGING BUDGET CONFLICTS - CONTRIBUTION OF GOAL INTERDEPENDENCE AND INTERACTION

Managers are confronted with many conflicts when they use a budget How they discuss their opposing views may have a substantial impact on wh ether the conflicts contribute to the budget process productively or d estructively. This study used the theory of cooperative and competitiv e goal interdependence to analyze the interaction between managers as they deal with budget conflicts. Structural equation and other analyse s of interviews with managers in a large utility indicate that coopera tive goals support an open-minded discussion of opposing views, which in turn promotes productivity and work relationships that result in ac ceptance of the budgeting system and a sense of team unity. The result s were interpreted as suggesting that organizations that structure coo perative goals and develop constructive controversy skills help their managers use their budget conflicts productively.