Reference no: EM132757240

Nuzhat Lotia, University of Melbourne

• Struggle For Development (SFD) is a community development organization based in Sydney. It was set up in early 2014 by a group of students who were studying International Development. The students-Bryan, Elsa (originally from East Timor), Ali, Shanti, Sophia, and Amira-had been involved in a project in East Timor as part of their development practice. The project, a modest literacy, and education program for women in the village that Elsa was originally from had been extremely successful, and they had returned to Australia determined to continue the work that they had started.

• SFD was established by a group of 11 people-the original six from the development practice project and five of their university friends. Its founding vision was one of empowering marginalized communities including the economically disadvantaged, women and children. The organization implements projects focusing on education and skills development for women and works towards their greater participation in decision-making in all spheres of their lives, both in East Timor and Australia.

• Only one of the founders, Sophia, worked full-time for SFD (as its coordinator), while the others worked full-time elsewhere. Together they formed the Board of SFD. The coordinator's role involved managing the day-to-day operations and decision-making. Most Board members visited SFD's office in the evenings to discuss issues and work on funding applications, reports, and administrative tasks. They were all closely involved in running the organization and managing its various projects.

• SFD's operations grew, and in late 2015 the Board set up a management committee (a sub-committee of the Board). Comprising of the three most experienced Board members (Shanti, Ali, and Amira), the management committee's function was to work closely with the coordinator. The Board was happy to hand over its overseeing role to the management committee because of SFD's growing size and operations. The management committee made most decisions and worked closely with Sophia, who would often seek advice from one or all of its members on operational issues.

• By 2016, SFD had employed two more of the founders in full-time positions: Elsa became a project officer and Mark became administration and finance coordinator. Some Board members were unhappy with this as they felt that the management committee had not fully explored all recruitment options. Some of them raised this issue but, after some heated arguments, decided to let it go as they did not want to offend their friends. At this point, Shanti decided to resign from both the management committee and the Board. She felt she was being targeted because Mark was a close friend of hers. The management committee was reduced to just two members, Ali and Amira (see Figure 1), which became an issue as they were unable to devote the necessary time to the organization, which had grown substantially. SFD now had 23 full-time workers and its activities had spread out to several villages in East Timor. The other Board members felt that the management committee was not playing its proper role and raised this as an issue.

• The management issue was exacerbated when, towards the end of 2016, Sophia resigned from her position. As a temporary measure, the management committee decided to give Elsa the additional responsibility of overseeing work in all regions (see Figure 2) as a temporary project coordinator. Elsa rose to the challenge and worked very hard to fulfill this new management responsibility, doing quite a good job (with Ali and Amira's support). To fill the void created by Sophia's resignation and the reduced size of the management committee, Ali and Amira initiated discussions around bringing about some structural changes in the organization, especially as SFD had just been funded to do some work in a new region (Region 3).

• They proposed to the Board that the management committee should be disbanded and that an executive director's (ED) position be established to manage the organization (see Figure 3). They suggested that Fred (a Board member) be hired for the ED position. Fred was seen by some Board members and staff as being a close associate of Ali and another board member, Mary. Amira and Ali wanted to take Fred on as the ED because they felt that the current staff in general-and Elsa in particular-did not have the skills needed to manage the organization. Elsa, they felt, did not have the skills required for managing donor relations and supervising a large and growing staff base and operations. They also recommended hiring project officers for Regions 2 and 3 to enable Elsa to move back to managing Region 1 projects. To facilitate a handover process, the proposed working with Fred as the new ED for a four-month period, after which all management responsibilities would be passed on to the ED.

• Ali and Amira presented their proposal in a Board meeting in March 2017, the first time that Elsa and the majority of members of the Board heard about it. (Two members of the Board had heard about it through informal discussions with Amira. These two, who were regarded as allies of Ali and Amira, supported the proposal, along with the putative ED, Fred.) However, four Board members were not happy with the proposal and felt that the ED position should be offered to Elsa. They argued that bringing in another person over her head would undermine her authority and reputation. (These were the members who had worked with Elsa in the past and had close affiliations with each other.) Initially, they did not convey their opposition directly, but blocked and stalled the decision-making process by getting into long discussions on the proposed organizational structure. Meanwhile, Elsa saw this proposed change in SFD's structure as a demotion in terms of her position and in terms of reporting to another Board member. She threatened to resign if the new structure was implemented.

• Two factions had been created in the Board-pro-Elsa and pro-Fred. Consequently, there was a lot of tension among the Board members, the tension that was filtering through to the staff. In an attempt to reconcile the differences, Amira and Ali suggested recruiting an outsider for the ED position instead of Fred; but this was unacceptable to the Board members who supported Elsa. Finally, two of the pro-Elsa faction stopped participating in Board meetings. The interpersonal relationships of this once very cohesive group had become extremely strained.

This case is based on actual events, but names and characteristics have been changed to maintain anonymity.

Problem 1) What are the sources of conflict at SFD as it considers changes in organizational structure?

Problem 2) What is the impact of the conflict?

Problem 3) What conflict-handling styles can you see being used in relation to the issues of structural change at SFD?

Problem 4) What conflict-handling style should be employed to resolve the conflict in this situation?

Problem 5) What structural approaches can Ali and Amira employ to resolve the conflict and minimize the resistance to the proposed change in organizational structure?