Thomas-Kilmann Instrument (TKI): International Commercial Arbitration

Introduction

In the context of international commercial activities, it is worth noting that conflicts are inevitable. The manner through which disputes, which involve two or more business entities from different nations, are resolved depends on how they are perceived by the individual parties (Stanley & Algert, 2007; Thomas, Thomas & Schaubhut, 2008). It is prudent to recognize that commercial conflicts arise due to miscommunication and variations that could impact emotions, objectives, perspectives, and opinions. The Thomas-Kilmann Instrument (TKI) is a useful tool that could be applied to resolve conflicts in international commercial businesses (Thomas et al., 2008).

It is important because it helps to understand how different persons behave in conflicts (Morrison, 2008). This presentation focuses on evaluating how the TKI could be used to find solutions to international business conflicts.

How the tool could be applied

International commercial arbitration is aimed at ensuring that neither party in a conflict encounters major losses (Morrison, 2008). In fact, some disagreements could result in great short-term and long-term impacts (Stanley & Algert, 2007). Thus, every party seeks to have the best outcomes from an arbitration process. The TKI could be applied to learn about two important aspects, i.e. assertiveness and cooperativeness (Morrison, 2008). Assertive business people are exemplified by high degrees of concern for themselves. On the other hand, if a person is cooperative, then it implies that he or she shows concern for others. In fact, the TKI could be plotted to display dispute styles along two axes, which could further be analyzed to give the following conflict handling modes:

• Accommodating.
• Avoiding.
• Collaborating.
• Competing.
• Compromising.

Application of the ‘competing’ element of the TKI

The tool can be applied to resolve an international business conflict through the adoption of the aspect of ‘competing’ that is both assertive and uncooperative (Thomas et al., 2008). Using the approach, a party needs to assume that his or her needs are more important than those of other persons. For example, if Coca-Cola Company is in a dispute with Pepsi Company, then it could apply the aspect by behaving in a power-oriented mode. This could translate into “standing up for its rights and defending a position which it believes is correct” (Moses, 2012, p. 46). The business establishment could use the competing conflict handling style on a number of occasions. First, it can adopt the approach if it needs to make quick actions such as those required in an emergency. Second, when the management feels that it needs to make important decisions on unpopular courses of action. Third, it can use the strategy to protect itself in cases where it feels that there is a need to take advantage of non-competitive behaviors.

Application of the ‘collaborating’ element of the TKI

On the TKI scale, ‘collaborating’ is the type of conflict handling that uses both assertive and cooperative features. When two business entities are involved in a commercial dispute, they should work together to find mutual solutions. This requires business entities to consider the needs of each other in the conflict. For example, each party could consider its expected losses and/or benefits and those of its rival. The TKI model proposes that this approach involves creative thinking and exploration in order to learn about each person’s insights. Two business entities could use the approach to address concerns that are too important to be compromised. When a party gains commitment from a rival with regard to arriving at a consensus decision, then collaboration could be important. In addition, parties could collaborate if they want to bring together insights from diverse sources, which they believe they could use to find long-term solutions to issues (Stanley & Algert, 2007; Thomas, 2009).

Application of the ‘avoiding’ element of the TKI

On the TKI scale, ‘avoiding’ is the dispute handling approach that is both unassertive and uncooperative. When using this strategy, an international business “person does not pursue his or her own concerns nor the concerns of the other individual” (Moses, 2012, p. 65). Thus, issues that are the genesis of the dispute are not addressed. For illustration, it could be important to use two companies. For example, GSK and Roche Group could be used. The two firms could apply the ‘avoiding’ element of the TKI when their management teams realize that other parties, such as international commercial courts, can effectively resolve their issues. They might also avoid resolving issues if they learn that “the potential costs of confronting a conflict outweigh the benefits of its resolution” (Moses, 2012, p. 76).

Application of the ‘compromising’ element of the TKI

On the TKI scale, ‘compromising’ is the dispute handling style that is both moderate in assertiveness and cooperativeness. Although the parties involved in an international commercial dispute may aim at being satisfied, they may not find solutions that fully satisfy them. However, solutions partially satisfy them both in short-term and long-term. The ‘compromising’ element of the TKI could be applied to find solutions to an international commercial dispute when the parties want to achieve a temporary settlement. In addition, the approach could be applied when seeking a quick middle-ground solution (Thomas, 2009).

Application of the ‘accommodating’ element of the TKI

The last application of the TKI in the context of arbitration of international commercial disputes is the use of ‘accommodating’ element, which is found on the TKI scale. It focuses on “maintaining positive relationships rather than achieving an individual goal” (Moses, 2012, p. 87). People who accommodate concerns of other persons recognize that they have more to gain by adopting peace and focusing on remaining harmonized (Moses, 2012, p. 87). A party in an international commercial conflict could apply the approach if it realizes that an individual cost is not a significant loss. In addition, it could be utilized if a business entity feels that it is wrong and an alternative insight is superior (Thomas, 2009).

Conclusion

In the contemporary business world, it is difficult to avoid commercial conflicts. It is evident that disagreements occur because of miscommunication, which makes business entities feel threatened. In fact, disputes could result in major business losses. The TKI is an important tool that could be applied to find solutions to issues in international commercial activities. The conflict-resolving model is based on a thorough understanding of the behaviors of persons in disagreements. On the TKI scale, the following modes of handling conflicts have been identified: accommodating, collaborating, avoiding, competing, and compromising.

References

Morrison, J. (2008). The relationship between emotional intelligence competencies and preferred conflict‐handling styles. Journal of Nursing Management, 16(8), 974-983.

Moses, M. L. (2012). The principles and practice of international commercial arbitration. Cambridge, United Kingdom: Cambridge University Press.

Stanley, C. A., & Algert, N. E. (2007). An exploratory study of the conflict management styles of department heads in a research university setting. Innovative Higher Education, 32(1), 49-65.

Thomas, K. (2009). The four intrinsic rewards that drive employee engagement. Ivey Business Journal Online, 8(2), 1-6.

Thomas, K. W., Thomas, G. F., & Schaubhut, N. (2008). Conflict styles of men and women at six organization levels. International Journal of Conflict Management, 19(2), 148-166.

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