Leaders and managers spend considerable time resolving conflicts and negotiating. A frequent estimate is that they devote about 20 percent of their time to dealing with conflict including negotiation. Conflict arises frequently among top executives, and it can have enormous consequences for the organization. Departmental competition is a challenge for companies of all sizes, often resulting in product delays, increased costs, and dwindling market shares as departments fight each other for domination behind the scenes.

Until conflict between or among the groups is resolved, collaboration is unlikely. Another type of intergroup conflict leaders might face is dealing with heavy demands from a large employee group, such as employees uniting to complain about working conditions. A frequent conflict of this type is a group of workers demanding a higher minimum wage, particularly at large discount retailers and fast-food chains. Leaders are sometimes involved in conflict with groups outside their organization, and such conflict may need to be resolved.

Conflict resolution is more a study of managerial skills than leadership because it has more to do establishing equilibrium than with helping the firm or organizational unit reach new heights. It is helpful to understand conflict resolution styles and negotiating and bargaining skills.