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System Conflict and Resolution

Employees at a specialty steel company are divided into the "hot end" and the "cold end" of the production process. The hot end forms the steel rods that make their way down the line to the cold end, where they are packed for shipment to clients. Employees at the cold end are primarily responsible for quality control because they are the last ones to see the product before it leaves the plant. Their performance is measured by an index of customer complaints and returns, so they are motivated to reject any rods that don't meet quality standards. But employees at the hot end of the production line earn bonuses based on their output and rejection rate. The fewer rods rejected by employees at the cold end, the fatter the bonuses of the employees at the hot end. This creates conflict between the hot-end and cold-end employees. Hot-end employees complain that their cold-end colleagues are too fussy about product quality. Cold-end employees don't like the hot-end employees questioning their quality control decisions. Discuss the source(s) of conflict in this situation and recommend a solution to this conflict.

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The source of the conflict is the award system created by the company which rewards one side and simultaneously punishes the other side by not rewarding them. The higher the reward on one side the lower the reward on the other so we have a ...