within charitable organisations Roger Bennett London Metropolitan University, London, UK, and Sharmila Savani Harrow College, London, UK Keywords Marketing, Psychological research, Charities Abstract Extensive research has been undertaken into the proposition that certain organisational arrangements and working methods (e.g. centralisation, functional specialisation, multi-disciplinary teamworking and training, organisation-wide reward systems) inuence the levels of dysfunctional conict in businesses. The present study assessed the relevance of these variables for explaining the existence of conict between marketing and other departments within non-prot organisations. Additionally the investigation examined the role of psychological distance (a construct borrowed from the international marketing literature) as a possible determinant of conict. A total of 148 marketing managers of large UK charities completed a questionnaire exploring these matters. It emerged that several of the factors known to mitigate dysfunctional conict in the commercial world exerted similar effects in many of the sample charities. Psychological distance was signicantly associated with both the presence of dysfunctional conict within a charity and the manners whereby conict resulted in adverse organisational consequences. Introduction A charitys ability to full its mission depends critically on its fundraising capacities, for without a steady stream of income a charity cannot continue to complete its philanthropic work. Moreover charities that are heavily involved in raising public awareness of social issues (child abuse or domestic violence for example) need to possess excellent advertising and other marketing communications competencies in order to put their message across, and must therefore apply the highest levels of professionalism to the creation and implementation of their campaigns. It follows that charities have to employ top calibre people to undertake specialist marketing tasks, and that the marketing function should occupy a key organisational role (see Bond, 1996; Cervi, 1996; Bennett and Gabriel, 1998). Examples of the consequences of marketing orientation within charities abound. Numerous charitable organisations now merchandise wide ranges of charity branded products not directly connected with their philanthropic activities (e.g. credit and retail loyalty cards, insurance policies, foreign holidays, confectionery, sun tan lotion, CDs, bank accounts, burglar alarms (see Bennett and Gabriel, 1999)), and non-prot fundraisers are at the forefront of developments in direct and database marketing, in the The Emerald Research Register for this journal is available at The current issue and full text archive of this journal is available at www.emeraldinsight.com/researchregister www.emeraldinsight.com/0143-7739.htm LODJ 25,2 180 Received August 2002 Revised January 2003 Accepted July 2003 The Leadership & Organization Development Journal Vol. 25 No. 2, 2004 pp. 180-200 qEmerald Group Publishing Limited 0143-7739 DOI 10.1108/1437730410521840 application of market segmentation software and techniques, and in the protable utilisation of emotive advertising imagery (Bennett, 1998; Bennett and Gabriel, 1998). It follows that a key function of the leadership of a fundraising charity is the effective integration into the wider organisation of a variety of marketing tasks. There is evidence to suggest, however, that marketing departments do not always t comfortably into organisations motivated primarily by values rather than by wealth creation or the phenomenon of power (Lewis et al., 1997, p. 279), and where the main focus is on helping the needy rather than on raising funds. Indeed, anti-marketing bias has been observed in a number of the UKs leading charities (see Burnett, 1986; Clutterbuck and Dearlove, 1996; Bennett, 1998). Charities have numerous and diverse stakeholders (beneciaries, donors, volunteers, government agencies, politicians, trustees, programme managers, employees, funding bodies, etc.), some of whom may believe emphatically that a charity should devote virtually all its donor income to purely philanthropic activities, not to marketing and public relations. Often, individuals join a charitable organisation because of the compatibility of their beliefs with the values of the organisation (Catano et al., 2001, p. 257), and competence at marketing might not be among the characteristics of an organisation that the person most admires. In particular, volunteers (especially those occupying leadership positions) have been found to be heavily involved psychologically with their organisations (Catano et al., 2001). Such involvement is mainly with the philanthropic operations of the charity concerned, not with the ways in which it presents itself to the outside world. Hence a marketing department might be seen by detractors as a cost (as opposed to a revenue generating) centre that, through its glossy promotions, expensive advertising and public relations (PR) stunts, drains resources from charitable programmes and inhibits the pursuit of philanthropic goals. Further objections to charity marketing could derive from the assumptions that anything gained by one charity from a successful campaign is necessarily lost by others and that high-prole promotions create among potential donors feelings that their contributions will merely be spent on additional advertising, not on beneciaries. The latter conviction might be widely held. OSullivan (1993) reported survey data indicating that 40 per cent of a sample of 1,312 people thought that charities wasted money on advertising. It is relevant to note in this context how the UK press has routinely attacked charities for having relatively large fundraising to total expenditure ratios (see Omisakin, 1997; Paton, 2002). Margolis (2001), for instance, noted the furore surrounding the press expose of the fact that in 1999 the National Society for the Prevention of Cruelty to Children (NSPCC) spent more on administration and marketing than on helping children in need. (This pattern of expenditure was in fact fully justied because the NSPCC is quintessentially an awareness-raising institution that, ipso facto, spends large amounts on public education campaigns.) Conict between marketing and other functions 181 Clearly, conict between the marketing function and other areas of a charitys operations can arise. Marketing staff may themselves feel alienated. For example, they might perceive the marketing department to lack status and to be regarded as little more than a cash cow which nances the rest of the organisation but is not given the resources necessary to perform its duties satisfactorily (see Barclay, 1991). A charitys marketing department requires money, information and properly paid personnel, yet it may have to seek these from people who are not sympathetic to marketings role. Hence, intense negotiations may be needed to secure funds for the proper discharge of the marketing function (see Srivastava et al., 1998), and to prioritise and implement marketing activities (Hudson, 1995). Positive and negative interdepartmental conict Positive aspects of conict Conict between functions within an organisation, according to Lewis et al. (1997), is inevitable consequent to the boundaries arising within any organisational structure and the need for the organisations members to compete for scarce resources. In the words of Appelbaum et al. (1999, p. 62), conict is a process of social interaction that involves a struggle over claims to resources, power and status, beliefs, preferences and desires. Accordingly, Appelbaumet al. (1999, p. 62) continued, conict is a natural phenomenon in social relations, as natural as harmony. Nevertheless, conict within organisations can be managed (see Amason et al., 1995; Menon et al., 1996; Lee, 1998; Darling and Walker, 2001; for reviews of the academic literature on conict management within organisations), and may have positive as well as negative consequences. Thus conict can be a healthy incentive for action and competition when present in some forms and degrees (Lewis et al., 1997, p. 275). Ideas, beliefs and pre-assumptions are challenged vigorously (Bagshaw, 1998), innovation and the willingness to consider fresh approaches are encouraged, information exchange and the free and frank expression of opinions and feelings are stimulated (see Menon et al., 1996). Arguments about how best to complete tasks and/or attain objectives allegedly facilitate individual and group learning (Senge, 1990), increase critical vigilance and self-appraisal (Darling and Walker, 2001, p. 232) and, according to Lee (1998) represent a necessary and inevitable aspect of organisational change. Moreover the consideration of a wider range of options resulting fromhelpful conict arguably improves decision-making and generates stronger commitment to chosen strategies (Amason, 1996; Menon et al., 1996; Lewis et al., 1997). Dysfunctional conict On the other hand, interdepartmental conict can be dysfunctional and frustrate initiatives in other departments (Maltz and Kohli, 2000, p. 479). Dysfunctional conict is said to be emotional in nature and, typically, to involve personal disputes (Amason, 1996). Disagreements are seen as personal criticism; debates as political gamesmanship. Manifestations of LODJ 25,2 182 dysfunctional conict include interference with another functions work, exaggeration of a persons inuence, withholding and/or distorting information (Barclay, 1991), the creation of coalitions to block certain proposals, non-response to requests for information, rigid adherence to procedures, and generally apathetic behaviour (Mechanic, 1964; Lewis et al., 1997). Individual reactions to dysfunctional conict may differ substantially. Some people might respond by withdrawing from situations, sulking and becoming resentful. Others may seek to compromise and accommodate (McKenna and Richardson, 1995). In extreme cases conict of this type can result in stress, hostility, dissatisfaction, ill-feelings and greatly reduced co-operation (Pondy, 1967). In the specic context of non-prots, Lewis et al. (1997, p. 275) observed how dysfunctional conict could cripple their ability to function in goal setting, stafng, the conduct of meetings, problem-solving and decision-making, the identication and utilisation of individual skills, and writing submissions for government funding. Dartington (1996, p. 12) concluded that typically the accountability of the leadership of a non-prot organisation is complex, and hence that criticisms and support are likely to come from any and all quarters. This had the potential to destabilise a charity and generate conicts capable of destroying its main aims and objectives. As accountability within a charity is so complex, Dartington (1996) continued, the design of an organisation so as to avoid dysfunctional conict represented a major leadership task. It is relevant to note however that a number of studies have found that leaders of non-prots need not adopt particular approaches to leadership in order to succeed. Thus, for instance, Egri and Hermans (2000) study of the leadership styles of leaders of North American non-prot environmentalist organisations concluded that, although the leaders in the sample differed from leaders of for-prot green businesses in relation to their levels of emotional maturity, there were few actual differences in leadership behaviour. Similarly, a survey of 29 non-prot organisations completed by Adeyemi-Bello (2001) found that effective leadership style did not depend on whether an organisation was for-prot or not-for-prot. Similar genres of leadership behaviour were associated with successful outcomes in both sectors. Johnson (1999, p. 21) argued that the competent leadership of UK charitable hospices depended not on charismatic leadership styles, but rather on a shared, clear corporate vision. Origins of conicts between departments Interdepartmental conict can arise from, inter alia, differences in aims, values, expectations, intended courses of actions, and ideas about how best to handle situations (Darling and Walker, 2001). Differences of this nature have been variously attributed to dissimilarities in organisational demography (in terms of cultural diversity, work relevant expectations, and employees education and technological levels), to the ways in which organisations are designed, and to personality factors. Allegedly, demographically dissimilar Conict between marketing and other functions 183 people approach and solve problems in divergent manners (Chatman et al., 1998) and perceive the characteristics of their jobs and organisational roles differently (see Pearson and Chatterjee (1997) for details of relevant literature). Individual demographic dissimilarity has been found to impact on both task conict and emotional conict between departments (see Pearson and Chatterjee, 1997; Pelled et al., 2001). Organisational design involves such matters as the mechanisms whereby employees share tasks, the degree of centralisation, extent of formal rules and procedures, and the intensity of the division of labour (see Barclay, 1991). Inappropriate organisational design can lead to differences in departmental goals, communications breakdowns, anxieties emerging from organisational change, competition for resources, and unattainable desires for departmental autonomy (Pondy, 1967). The design of the team structures and procedures that govern the ways through which employees work can also affect the level of conict (positive or dysfunctional) within an organisation. For example, Erez et al. (2002) found that teams which rotated leadership among their members experienced less conict than teams with appointed leaders. If conict did arise within a team that rotated its leadership, the teams members were more likely to offer constructive suggestions for change. The central argument Whereas all of the above-mentioned issues have been researched extensively in the context of commercial businesses (for reviews see, for example, Ruekert and Walker, 1987; Barclay, 1991; Amason, 1996; Menon et al., 1996; Maltz and Kohli, 2000), they have not (to the very best of the authors knowledge) been investigated in relation to charitable organisations. Yet, a priori, conicts between certain departments within a charity might reasonably be expected to occur. The aim of the research reported in the present paper was therefore to add to what is known about both charity management and the antecedents of interdepartmental conict via an empirical study of these matters in the non-prot sector. In particular, the investigation assessed the inuence on conict of a variable well-known in other areas of marketing research, but which has not been fully explored in the context of interdepartmental relations, i.e. psychological distance. The central argument underlying the work was that organisational factors have the capacity: to determine whether dysfunctional interdepartmental conict exists within a charity; and if it exists, to inuence the level of intensity of such conict. It is suggested moreover that the forces known to be relevant to these matters in the commercial sector apply equally to fundraising non-prots. A priori, it is posited that conicts between marketing and other functions within a charity are to be expected as a matter of course, for the reasons previously outlined. A factor not previously considered by the organisational conict literature is examined, namely psychological distance. It is hypothesised that the presence of a LODJ 25,2 184 substantial degree of psychological distance leads to dysfunctional conict and that thereafter dysfunctional conict impairs organisational performance. Development of the hypotheses Psychological distance as a source of interdepartmental conict The term psychological (or psychic) distance was coined by researchers in the eld of international marketing to describe differences in language, behaviour and culture that deter business people from wanting to enter certain foreign markets. It is a perceptual state arising from disparities in norms and values and which depends, therefore, on experiences and differences in the cultural backgrounds of the people involved in the process of interaction. Psychological distance does not imply dislike (Swift, 1998), but it does make individuals feel less at ease with others they perceive to be different. Also the higher the level of psychological distance the greater the effort required to understand and effectively communicate with the other party and hence form a close working relationship (Conway and Swift, 2000, p. 1391). Psychological nearness, conversely, enables managers to notice (and appreciate) subtle yet critical aspects of other peoples behaviour, hence facilitating learning (Evans et al., 2000). A number of variables can contribute to the level of psychological distance between groups including, according to Fisher et al. (1997) and Swift (1998), differences in education, values and attitudes, ethical and moral positions, status, management style and working practices, decision-making processes, tolerance for risk and, above all, language. Fisher et al. (1997, p. 57) observed how language is the principal means whereby people access culture and communicate. Language misunderstandings can impair communication therefore even if the volume of communication is extensive. Marketing professionals employed by charities frequently possess business qualications and experience (Bond, 1996; Bennett and Gabriel, 1998) and are likely to speak about revenue surpluses, efciency and performance. Their world view might focus on market orientation, communications techniques and technologies, the development of corporate image and identify, etc. Conversely, managers in charge of a charitys operational programmes may come from a wide range of backgrounds, possess non-business related qualications, and have been attracted to charity work by heavily altruistic as well as employment motives. Operational programme performance is rarely measured in purely nancial terms (Hudson, 1995), but rather against successes achieved in relation to helping and caring. It is suggested here that a positive connection may exist between the presence of dysfunctional conict and the extent to which charity marketing managers are psychologically apart from the rest of the organisation. The rationale for such a proposition is that functions that are psychologically close should in principle be easier to learn about and understand (see Evans et al., 2000); thus engendering trust, empathy, the formation of mutual Conict between marketing and other functions 185 understandings and appreciation of the other partys work (Swift, 1998). Each side might be better able to comprehend the value systems and priorities of the other, resulting in common perceptions of reality and uniform approaches to problems (Barclay, 1991). Accordingly, the rst substantive hypothesis tested in the course of the investigation was that: H1. The greater the degree of psychological distance between marketing and other departments within a charity the more likely that dysfunctional conict will occur. Co-ordinating mechanisms Studies that have examined relationships between marketing and other functions in commercial organisations (see Pinto et al. (1993) for details) have identied a number of factors which seemingly affect levels of co-operation. These factors include the presence of co-ordinating mechanisms (e.g. formal rules and procedures), the degree of interfunctional interaction and the similarities of the duties undertaken by various departments, physical proximity of staff from disparate functions, and compensation systems that reward the attainment of interfunctional (rather than departmental) goals. Barclay (1991) noted how the existence within an organisation of competitive reward systems might encourage employees to relate more to their functional specialisms than to the attainment of superordinate goals. If people are paid substantially on the basis of the achievement of organisation-wide rather than functional objectives then, arguably, dysfunctional interdepartmental conicts will be less likely because managers have material incentives to co-operate and interact harmoniously with their colleagues (see Fisher et al. (1997, p. 57) for details of relevant literature concerning this matter). Co-ordinating mechanisms have been investigated extensively. Pondy (1967, p. 299) for example noted how, by the 1960s, there existed a substantial body of evidence recognising the desirability of institutionalisation, programming and making routine of procedures for dealing with recurrent conict. Bureaucratic rules and procedures offer a convenient mechanism for integrating or co-ordinating activities, particularly those that cut across departmental boundaries (Pinto et al., 1993). They make relationships predictable, reduce the need for arbitrary decisions and clearly delineate departmental responsibilities. On the other hand, they could rob people of their autonomy and cause frustration that leads to aggressive behaviour towards other departments. Likewise, specialisation allegedly carries the potential to remove sources of disagreement through stipulating who does what and how (Amason, 1996; Menon et al., 1996). Typically, staff working in a specialised departmental structure will report to a single functional manager and will become trained, experienced and competent in a particular functional area. This competence may be recognised and valued by people in other departments (Mechanic, 1964; Pinto et al., 1993). Specialised organisation systems are logical, easy to understand, and have transparent chains of command that LODJ 25,2 186 clearly dene personal obligations and departmental activities. Thus, interdepartmental conicts may be less likely to arise in these conditions. On the other hand, specialisation might stimulate conict by encouraging departments to develop their own objectives, values and working methods and not to communicate with others (Barclay, 1991). Managers could become inexible and believe that their own function is more important than others (Bennett, 1991), and conicts of interest between specialised departments might emerge (Stoner and Wankel, 1986). For research purposes, however, the current paper follows the greater part of the previous academic literature in the eld (see Maltz and Kohli (2000) for details) in proposing that the impact of specialisation on conict should be benecial. The centralisation of authority within an organisation might also reduce conict. Centralisation means that senior management takes all the most important decisions. Departments do not determine the problems they are to address, nor the methods to be used to overcome them. Employees are bound by xed decision making protocols and exercise little discretion in the course of their work. There is no question of decentralised units competing against each other for resources or to undertake similar tasks (Bennett, 1991). The activities of all sections can be related to the objectives of the organisation as a whole. In principle, therefore, fewer opportunities for conict should arise (Bagshaw, 1998). The above mentioned considerations imply: H2. The closer the physical proximity of the staff in marketing and other departments the less likely that dysfunctional conict will occur. H3. The greater the degree to which compensation systems reward the achievement of organisational rather than departmental goals the less likely that dysfunctional conict will occur. H4. The presence of co-ordinating mechanisms involving: (a) large numbers of bureaucratic rules and procedures; (b) high levels of specialisation; and (c) the centralisation of authority, will reduce the occurrence of dysfunctional conict. Training and teamwork Other integrating factors that have been substantially researched are multifunctional training and multidisciplinary teamworking (see Amason, 1996; Maltz and Kohli, 2000; Mollenkopf et al., 2000). Multifunctional training is said to help managers to understand the: . jargon of other functions (thus reducing language barriers between specialisations); and . aims, priorities and perspectives of other departments. Similar outcomes allegedly emerge from having people work in cross-functional teams. A substantial literature supports the proposition that groups take decisions more effectively when composed of individuals Conict between marketing and other functions 187 possessing a variety of skills, knowledge bases, abilities, points of view and attitudes (see Amason, 1996). Team members interact (socially as well as formally) and gain experience of other functions that facilitates learning and understanding (Swift, 1998). Ruekert and Walker (1987) suggested that a further benet of cross-functional teamworking was its encouragement of managers to focus on organisation-wide superordinate goals rather than functional targets. A superordinate goal, according to Pinto et al. (1993) is one that is urgent and compelling for all the groups in an organisation but which requires the efforts and resources of all the organisations groups for its attainment. A high level of identication with the superordinate goals of the wider organisation supposedly motivates interaction between functions (Ruekert and Walker, 1987). Additionally it might strengthen the impacts of various managerial devices introduced to minimise dysfunctional conict (Fisher et al., 1997). These comments suggest: H5. The greater the amounts of: (a) multifunctional training; (b) cross-functional teamworking; and (c) communication and information sharing within a charity the less likely that dysfunctional conict will occur. The investigation The above-mentioned matters were examined in the charity context through a survey of the views of charity marketing managers. Although it would have been desirable to compare the responses of marketing managers with those of charity employees responsible for specic charity operational programmes, this was not feasible in the context of the present study in consequence of the diverse range of the activities in which the sample charities were involved. There is no generic job title of eld operations manager within charities. Rather, the humanitarian and/or philanthropic tasks undertaken by each charity are unique to that organisation and the job titles within the charity will reect those particular duties. Third World assistance charities, for instance, have managers in charge of disaster relief and food distribution; whereas health care charities have people responsible for providing medical facilities. Animal charities build veterinary hospitals and rehoming units, employ police liaison inspectorates, and so on. Hence, it was not possible to mail the questionnaire to a single meaningful job title reecting the operational charitable programmes of all the sample organisations. The questionnaire A questionnaire was developed to explore relevant issues and pre-tested via discussions with 18 senior employees within three leading UK charities plus an initial mailing to 75 charities drawn at random from the sampling frame (see below for further details). This pre-test facilitated the renement of the wordings of the questions and the removal of excessively overlapping items. The LODJ 25,2 188 document itself opened with a general section querying the respondents background (business, helping and caring or other), the persons experience and qualications), the charity sector involved, the number of years the charity had operated a marketing department, and the size of the charity. Thereafter the questionnaire (which is summarised in the Appendix) contained sections concerning organisation design, communication and information sharing among departments, compensation and training systems, perceptions of psychological distance between marketing and other functions, and the possible presence and consequences of dysfunctional conict. A newinventory was developed to assess interdepartmental psychological distance. The other constructs were measured using instruments adapted from pre-existing literature in the organisational conict area. Items concerning organisational design were based on those employed by McCabe (1987) and Barclay (1991) in earlier studies (see Appendix, Section A). The extent of cross-functional teamworking was explored via items modied from Bennett and Koudelova (2002) (Appendix, items A8 and A9); the degree of communication and information sharing was examined through items adapted from Ruekert and Walker (1987) and Fisher et al. (1997) (Appendix, items A15 and A16). Items based on instruments previously used by Fisher et al. (1997), Maltz and Kohli (2000) and Bennett (2002) investigated the charitys employee compensation systems (Appendix, items A13 and A14) and whether it engaged in multifunctional training (Appendix, items A10, A11 and A12). The presence of dysfunctional conict was assessed by items modied from Ruekert and Walker (1987), Barclay (1991), and Maltz and Kohli (2000) (Appendix, section C). An inventory to measure psychological distance[1] was developed in accordance with the procedures recommended by Churchill (1979). Accordingly, an initial pool of 12 items was generated from the applications of the construct reported in the previously mentioned empirical literature in the eld of international marketing. The 12 items were discussed with two senior marketing managers, two nance directors and two operational programme managers in each of three charities, and were circulated for comment via e-mail to a marketing manager and a programme manager in each of six further charities with which the authors had a direct relationship. Each interviewee or e-mail respondent was presented with a denition of the psychological distance construct and required to assess the 12 items on scales of one to ve in terms of their appropriateness and clarity vis-a` -vis the measurement of the construct. Only those items scoring four or ve were retained. Open-ended comments about each item were also invited. Subsequent to the feedback received, certain items were combined, reworded or deleted, resulting in the eight-item inventory shown in the Appendix, section B. All the items in the questionnaire other than factual queries were measured on ve-point scales: 5 strongly agree, 1 strongly disagree. The questionnaire together with a covering letter and stamped addressed reply envelope, was mailed to the heads of marketing of the UKs top 500 fundraising Conict between marketing and other functions 189 charities listed (by order of annual income) in the Charity Commission register (www.charity-commission.gov.uk). After a follow-up, 148 replies were received (29 per cent of the sampling frame). The replies of the rst 30 and the last 30 respondents were compared, no meaningful differences emerging. Analysis of the data An earlier section developed ve hypotheses concerning the central proposition that organisational considerations inuence the presence of dysfunctional interdepartmental conict within a charity. To test these hypotheses it was necessary to create from the questionnaire items (see the Appendix) a handful of composite variables (each reecting a particular construct relevant to one or more of the hypotheses covered by the investigation) that could be manipulated in an orderly manner. This was done by factor analysing each of the groups of items listed in the Appendix that contained four or more items, and examining the correlations within the item groupings with just two or three items. Consequently it was possible to form composite variables (i.e. averages of all the items belonging to a specic group) for the following: psychological distance, presence of dysfunctional conict, adverse consequences of dysfunctional conict, centralisation, specialisation, degree of bureaucracy, multifunctional training, interdepartmental communication, teamworking, and the existence of collective reward systems. (Details of the procedures employed are provided in [2], which also explains how the absence of common method bias (i.e. problems possibly arising from the fact that the same person in each charity had answered all the questions) was conrmed.) The sample charities The charities in the sample had a median of 101 full-time and 61 part-time employees. Hence it is reasonable to suppose that issues concerning organisational design, departmental structure and interfunctional communications were of major concern to the managements of these organisations. A total 87 per cent of the charities had operated a dedicated marketing department or section for more than 15 years. Thus marketing activities would be well-entrenched within the sample charities, the managements of which would have extensive experience of overseeing relationships between marketing and other functions. A total of 58 per cent of the respondents had marketing backgrounds, 18 per cent described their prior experience as being mainly concerned with their charitys philanthropic operations. The sample covered a wide range of types of charity (healthcare, animal welfare, disaster relief, etc.) with no single sector predominating. There were no differences in response patterns between people with marketing backgrounds and other backgrounds, or with respect to: . the individuals level of education (i.e. his or her highest qualication on leaving school or college); LODJ 25,2 190 . charity age or size; or . how long the organisation had operated a marketing department. A total of 27 of the 148 charities (18 per cent) fell in the top two response categories of the dysfunctional conict composite; 67 (45 per cent) were in the bottom two categories. This broadly matched the numbers in the top two and bottom two categories of the adverse consequences composite. Of the respondents, 52 (35 per cent) reported the presence of substantial psychological distance between the marketing function and the rest of the organisation (in the sense that their composited responses fell in the agree or strongly agree categories of the amalgamated psychological distance scale). A total of 38 per cent of the composited responses were in the disagree or strongly disagree categories. Clearly, there existed within the sample organisations a fair spread of circumstances pertaining to the topics under investigation. Specically, the presence of psychological distance and dysfunctional conict was a fact of life for a substantial number of the charities in the sample. Tests of the hypotheses The hypotheses were tested via a regression analysis that used the presence of dysfunctional conict, psychological distance, and the adverse consequences of conict as the variables to be explained. Signicant relationships among the variables were identied through an experimental procedure whereby all the candidate independent variables were entered in regression equations in various combinations. An independent variable was removed if it failed to attain signicance at the 0.05 level in any conguration of independent variables. Then the composites for the presence of dysfunctional conict and the adverse consequences of conict were correlated, the result (R 0:56, p , 0:001) indicating that it was indeed the case that interdepartmental conict within a charity was associated with inferior performance (in terms of the items listed in Appendix, section C2). The data were also examined for the possible presence of moderating inuences among the variables. A moderating variable is one that affects the strength of the relationship between two other variables, hence producing an interaction effect[3]. Accordingly, an independent variable that is moderated by another variable will exert a high or low impact on the dependent variable according to the value of the third (moderating) variable. Tests for interaction effects suggested the existence of two moderating variables. Psychological distance was found to moderate downwards the inuence of specialisation on the avoidance of conict. This means that specialisation within a charity did in fact lead to an overall reduction in the level of dysfunctional conict, but that the magnitude of the reduction in the degree of conict was lower in organisations that also exhibited a high degree of psychological distance between departments. In other words, the presence of psychological distance dampened the benecial effects of a specialised organisation structure. Similarly, centralisation appeared Conict between marketing and other functions 191 to moderate the link between the presence of dysfunctional conict and its adverse consequences. Respondents who reported high levels of dysfunctional conict in organisations that were highly centralised stated on average that their charities experienced relatively fewer adverse consequences. Thus, the detrimental impact of dysfunctional conict on operational difculties such as the absence of co-operation, lack of trust between departments, resentment and lack of understanding, etc. (see Appendix, section C2), was lower in charities that were highly centralised. It seems that centralised organisation systems could better accommodate and overcome some of the organisational difculties arising from the existence of dysfunctional conict. Consequent to the identication of signicant relationships among the variables using the experimental procedure previously described, the nal model emerging from the data analysis was estimated via the structural equation modelling facility of the AMOS 4 package. (The degree of communication and information sharing between marketing and other departments was highly correlated with cross-functional teamworking (R 0:66) and with multifunctional training (R 0:54) and thus was not used as a separate regressor.) The results are listed in Table I and are illustrated diagrammatically in Figure 1. It can be seen from Table I that several of the variables posited to exert an inuence on the levels of dysfunctional conict within commercial organisations by the academic literature in the eld (e.g. Pondy, 1967; Ruekert and Walker, 1987; Barclay, 1991; Amason, 1996; Menon et al., 1996; Maltz and Kohli, 2000) had a signicant impact on the occurrence of dysfunctional conict within the sample charities. Accordingly, the central proposition of the investigation (i.e. that organisational factors have the potential to contribute to the presence of dysfunctional conict within charities) is substantiated so far as this particular sample is concerned. Beta coefcient Critical ratio Adverse consequences of conict Presence of dysfunctional conict 0.401 3.667 Presence of dysfunctional conict times by centralisation a 21.121 3.004 Presence of psychological distance Centralisation 0.386 3.904 Presence of dysfunctional conict Cross-functional teamwork 20.212 2.133 Multifunctional training 20.169 2.007 Specialisation 20.116 1.999 Presence of psychological distance 0.547 4.333 Specialisation times by the presence of psychological distance a 1.024 2.309 Note: a Moderating variables were mean centred to avoid problems of multicollinearity Table I. Parameter estimates LODJ 25,2 192 Table I shows that specialisation within a charity signicantly reduced the level of dysfunctional conict experienced. Within a specialised structure, individuals concentrate on completing just a part of an organisations work rather than being concerned with the organisations activities as a whole. This compartmentalisation of duties presumably enables people to avoid getting in each others way and hence to side step many potentially conict-ridden situations. The diversity of skills that employees possess in a specialised set up might be mutually recognised by everyone concerned. Cross-functional teamworking and multifunctional training also exerted negative inuences on the emergence of dysfunctional conict (see Table I). Activities of this nature automatically bring people together and can help create common perspectives on problems and how they might be resolved. Intergroup relations are likely to improve in consequence of the enhanced familiarity with the work of other departments that these integrating mechanisms generate. However, organisation-wide reward systems and the existence of numerous rules and procedures were not signicant. Arguably, bureaucracy (in the sense of having to follow rigid rules) inhibits creativity and free thinking within organisations. This might impact predominantly on a persons relationship with the entire organisation as opposed to the individuals dealings with other departments. Group reward systems failed to affect the presence of dysfunctional conict, possibly because the co-operation between departments anticipated on a priori grounds from joint bonuses might have been counterbalanced by frictions arising from the realisation that money would be lost if employees in other departments were to underperform. The existence of psychological distance (though not physical distance) between marketing and other departments was heavily associated with the presence of dysfunctional conict, conrming the critical role of this previously under-researched (in the organisational leadership context) variable. Psychological distance also affected the strength of the impact of Figure 1. Signicant pathways Conict between marketing and other functions 193 specialisation on the degree of dysfunctional conict within an organisation. Centralisation did not mitigate dysfunctional conict directly (the regression parameter was only signicant at the 0.1 level), but it did act as a moderator in that it helped prevent the transmission of the presence of dysfunctional conict into adverse consequences. The greater the degree of centralisation, the higher the likelihood of psychological distance occurring between departments. (There was no evidence of multicollinearity among the independent variables explaining the presence of dysfunctional conict[4].) Presumably there was relatively little contact between departments in highly centralised systems, where all substantial decisions would be taken by people at the apex of a structure. Arguably there is less need for the sharing of information, interdepartmental interaction and co-ordination in these circumstances. Conclusion The rst hypothesis of the present paper, i.e. that the existence of substantial psychological distance between the marketing department and the remainder of a charitable organisation has the potential to aggravate dysfunctional conict within that organisation, is supported by the outcomes to the investigation. Moreover, psychological distance moderated downwards the capacity of a highly specialised organisation system to prevent the emergence of dysfunctional conict. These are disturbing outcomes, which suggest strongly that the leadership of a non-prot organisation needs to pay a great deal of attention to the application of measures that will minimise the extent of the psychological distance between departments. What exactly these measures should involve is a matter for further research, although the literature in other elds offers a couple of suggestions. Thus, for example, differences in personal norms and values among people in various departments might be addressed through internal programmes for disseminating information about the roles, activities and (importantly) the values of the contributions of specic operational functions. Short-term secondments and interdepartmental planned work experience assignments could also facilitate a sense of psychological nearness between sections. H2 and H3 concerning the possible benecial inuences of close physical proximity of marketing to other employees and of widely based compensation systems, are rejected so far as this particular sample is concerned. Perceptions of nearness to the work of other departments appear to have subsisted more at the mental than the physical level. Physical closeness to the ofce space occupied by people from a different function did not emerge as a signicant consideration. Likewise there was no evidence to support H4(a), that bureaucratic rules and procedures help an organisation avoid dysfunctional conict. H4(b), conversely, is accepted: specialisation seemingly provided a charity with clear departmental boundaries, roles and duties that mitigated the development of dysfunctional conict. It was not the case that people in LODJ 25,2 194 specialised organisational structures failed to communicate or work effectively with others (see Barclay, 1991). When dysfunctional conict occurred it did indeed result in damaging consequences. Hence the withholding of information, negative interference with the activities of other sections, blocking other departments proposals, etc. (see Appendix, section C, item 1) were not only annoying; but actually led to lack of trust and co-operation, resentment, dissatisfaction, and so on (Appendix, section C, item2). Thus the effects of the behaviour described in Appendix, section C, item 1 were concrete and generally harmful to the organisation. The centralisation of authority and decision making within a charity was associated with lower levels of conversion of dysfunctional conict into adverse consequences. As an integrating mechanism, however, centralisation did not of itself appear to prevent dysfunctional conict. Moreover, highly centralised charities were more prone to exhibit psychological distance between departments. Conversely, all three of the elements of hypothesis ve are accepted, conrming the outcomes to prior research in the eld. Accordingly, dysfunctional conict between marketing and other functions within a charity is apparently less likely in organisations wherein there is extensive cross-functional teamworking, much socialisation across departments, free and easy interdepartmental communications, and cross-functional training. In these as in other areas, organisational factors played a key role in determining the extents and natures of operational problems relating to conict. Further research is needed into the non-signicance of the numerous rules and procedures variable, as this was the only organisation design factor proposed by the previous academic literature on the subject which failed to exert any sort of impact. Additional research would also be useful into the relations between charities marketing departments and specic operational programmes. What, for example, are the qualities of a marketing executive that are most admired by charity programme managers? What are the major factors that facilitate social bonding between marketing and other staff? What are the roles of programme managers in the process of marketing campaign planning? Case studies of individual charities with a view to exploring in detail the characteristics of interfunctional relationships would be extremely valuable. Equally useful would be a study of the antecedents and consequences of benecial as opposed to dysfunctional conict in non-prot organisations. Notes 1. The term psychological distance was employed by Fisher et al. (1997) in the course of their examination of the effectiveness of communications between marketing managers and engineers. Fisher et als denition of the meaning of the phrase differed radically from that employed in the present study however in that Fisher et al. (1997, p. 67) restricted the construct to decision-making time horizons, tolerance for risk and the degree of focus on technology. Conict between marketing and other functions 195 2. The eight psychological distance items were factor analysed (using the facility available on SPSS 11) and the resulting factor structure conrmed via the AMOS 4 package. A single factor seven item solution emerged l 5:1, a 0:86), with Appendix, section B (h) (i.e. different approaches to management and decision-making) as an outlier that failed to load signicantly on the signicant factor. Hence itemB (h) was deleted from the inventory. The seven remaining items were composited into a single psychological distance scale. Factor analyses of the items for dysfunctional conict (Appendix, section C, item 1) and its consequences (Appendix, section C, item 2) similarly generated univariate solutions l 4:3, a 0:79 for the former construct, l 5:1, a 0:81 for the latter). Accordingly, single scales were created for each set of items. The pairs and threesomes of items relating to each of the various dimensions of section A of the Appendix were signicantly correlated (R .0.45 in all cases). Hence amalgamated scales were created to reect each variable (the existence of rules and procedures (A1), centralisation (A3, A4, A5), etc.). As the measures used in the study were based on self-reported data it was necessary to test for the possibility of common method variance, i.e. the ination or suppression of the magnitudes of the relationships under investigation consequent to the fact that both the dependent variables and the independent variables were obtained from the same source (Feldman and Lynch, 1988). As is conventional, the issue was addressed via a joint factor analysis of all the variables employed in the study and an examination of standard deviations and correlations among variables not theoretically related to each other (Lindell and Whitney, 2001). For the joint factor analysis, the two items within each construct that displayed the highest factor loadings when the relevant construct had been analysed separately (see above), or which correlated most strongly with other items in the case of a three-item construct, were employed in a 20-item exploratory analysis. (This reduction in the number of items was necessary because of limited sample size.) An eight-factor solution emerged corresponding to a priori expectations (each factor having an eigenvalue greater than unity), and no one factor explaining more than a quarter of the total variation in the data. The analysis was then repeated using (where appropriate) two different items to reect the construct in question. This did not lead to any substantial changes in the pattern of the results. The standard deviations of the variables indicated a wide range of response, and correlations among variables not theoretically connected were insignicant. Hence there was no evidence to suggest that the results were affected by common method variance. 3. If Y a bX, where b c dZ; then Y a cX dZX. Hence the statistical signicance the parameter d on the variable Z times X would indicate that the strength of the impact of X on Y is moderated by the value of variable Z. 4. 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Swift, J. (1998), Cultural closeness as a facet of cultural afnity, International Marketing Review, Vol. 16 No. 3, pp. 182-201. Appendix. The questionnaire A. Organisational factors (1) This charity has very many formal rules and procedures that have to be followed when making decisions. (2) Senior management is very strict with regard to following written rules and procedures throughout the marketing process. (3) Decision making in this rm is very centralised. (4) Decisions made by the marketing department are subject to extensive review by senior management prior to approval. (5) Members of the marketing department rarely have the authority to exercise their own judgement in relation to the charitys fundraising activities. Specialisation/multi-functional activities (6) There are many specialist departments and sections in this charity. (7) Employees tend not to be involved in many duties or functions outside their own narrow specialism. (8) Members of the marketing department serve on many cross-functional teams. (9) People from many other functions participate in teams set up to undertake marketing tasks. (10) Employees frequently participate in training programmes that acquaint them with areas outside their own specic function. (11) People in this charity are trained to do more than one job. (12) Training and experience in more than one functional area are considered essential for advancement in this charity. Reward systems (13) Bonuses linked to the overall performance of the charity as a whole are an important component of an employees remuneration in this organisation. (14) If people in one department under-perform, other departments will be made to suffer nancially. Conict between marketing and other functions 199 Communication and information sharing (15) Communications between marketing and other departments are free and easy. (16) Managers of different functions routinely and extensively share information. (17) The marketing department is physically a long way away from other sections (e.g. occupying its own separate ofces). (18) People in the marketing department communicate extensively with people in other departments. B. Psychological distance. Compared to employees in the rest of the organisation, people in the marketing department tend to: (a) Speak a different language. (b) Have a different World view. (c) Have different norms and values. (d) Have different motives for choosing to work for a charity. (e) Have different educational backgrounds and/or work experience. (f) Hold different ethical and moral positions. (g) Have a different culture. (h) Adopt different approaches to management and decision making. C. Dysfunctional conict (1) People in other departments frequently behave in the following ways towards the marketing department: (a) they block our proposals; (b) they withhold or distort information; (c) they see disagreements as personal criticism; (d) they interfere with our work in negative ways; (e) they fail to respond to requests for information; (f) they frustrate our initiatives. Consequences of dysfunctional conict (2) Our relationships with other departments may be described as involving: (a) little co-operation; (b) many resentments; (c) little mutual understanding; (d) much dissatisfaction; (e) feelings of being ill at ease when dealing with other departments; (f) little appreciation of the importance of our work; (g) lack of trust. LODJ 25,2 200