Workplace with employees connected by puppet strings, symbolizing organizational politics.

Is Office Politics Killing Your Company? How to Detoxify Your Workplace

Beau Callahan in Business & Economy July 2025 • 4 min read.

"Uncover the Hidden Costs of Organizational Politics and Build a Fairer, More Productive SME"

Organizational politics, the unspoken games and power struggles within a workplace, have long been a subject of academic and practical interest. While the concept itself isn't new, serious scholarly inquiry into its impact on organizations has only recently emerged as a robust field of study. These studies highlight that politics are an almost inevitable part of organizational life, demanding closer attention and empirical examination to understand and manage their effects.

The consequences of unchecked organizational politics can be severe, particularly concerning employee well-being and overall productivity. Research consistently demonstrates that a politically charged atmosphere fosters perceptions of inequity, diminishes organizational commitment, and ultimately drives employees to seek opportunities elsewhere. This turnover is costly, with expenses far exceeding the investment required to retain valuable staff.

While research into organizational politics is growing, there's a significant gap in our understanding. The focus has largely been on large corporations, neglecting the unique dynamics within small and medium enterprises (SMEs). Given that SMEs are vital engines of economic growth and job creation, especially in developing countries, it's critical to address this oversight. The characteristics of large sized firms and the SMEs are different and the findings might be expected to be different.

The High Cost of Unfairness: How Workplace Politics Fuels Turnover

Workplace with employees connected by puppet strings, symbolizing organizational politics.

Justice judgment theory suggests that employees are deeply concerned about fairness. When they perceive fair treatment, they report greater satisfaction in their social relationships at work. A proliferation of studies in organizational justice suggests that Justice Judgment theory assumes that an individual's perception of fairness is based on justice rules. Justice rule is defined as an individual's belief that a distribution of outcome, or procedure for distribution of outcomes, is fair and appropriate when it satisfies certain criteria.

In contrast, organizational politics often undermines this sense of justice. Employees in politically charged environments are more likely to feel insecure due to ambiguity, unfair treatment, and perceived inequity. This can lead to dissatisfaction, decreased commitment, and, ultimately, a higher intent to leave the organization.

Reduced Productivity: Employees disengage when they feel unheard or undervalued.
Damaged Morale: A toxic environment breeds resentment and distrust.
Loss of Talent: High turnover disrupts team dynamics and institutional knowledge.

Studies show a clear link between perceptions of organizational politics and turnover intentions. When employees believe their workplace is rife with political maneuvering, they anticipate unfair treatment and manipulative actions, increasing their desire to leave.

Turning the Tide: Practical Steps to Detoxify Your Workplace

Addressing organizational politics requires a multifaceted approach. SME owners and managers should prioritize strategies that promote transparency, fairness, and open communication. By fostering a culture where employees feel valued and respected, businesses can mitigate the negative effects of political maneuvering and cultivate a more engaged, productive workforce. Some of these measures might include instituting a strict code of conduct at the workplace and ensuring that the code of conduct is understood, observed and enforced. Managers are also encouraged to reward desired behaviors that follow the code of conduct while punishing undesirable behaviors that promote negative organizational politicking at the workplace.

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Everything You Need To Know

What is organizational politics and why is it important to understand?

Organizational politics refers to the unspoken power dynamics and competitive behaviors within a workplace. It's crucial to understand this because research demonstrates it significantly impacts employee well-being and overall productivity. Unchecked, it can foster perceptions of inequity, diminish organizational commitment, and drive employees to leave, leading to costly turnover. The impact of the organizational politics demands closer attention to manage its effects effectively.

How does organizational politics specifically affect employees and their commitment to a company?

Organizational politics creates a work environment where employees perceive unfair treatment due to ambiguity and inequity. This can lead to dissatisfaction, decreased commitment, and a higher intent to leave. Employees in politically charged environments often feel insecure, which undermines their sense of justice. This is explained by the Justice Judgment theory, which highlights how an individual's perception of fairness influences their satisfaction and commitment at work. When employees feel the rules are not fair, they are more likely to be dissatisfied.

What are the direct negative consequences of organizational politics on a business?

The negative consequences are: reduced productivity, damaged morale, and loss of talent. Employees disengage when they feel unheard or undervalued, leading to lower productivity. A toxic environment, fueled by political maneuvering, breeds resentment and distrust, damaging morale. High turnover disrupts team dynamics and leads to a loss of institutional knowledge, costing the company significantly. These factors together affect the company's performance.

Why is it particularly important to address organizational politics in small and medium enterprises (SMEs)?

While research on organizational politics has largely focused on large corporations, SMEs are a vital engine of economic growth. Addressing organizational politics in SMEs is critical because their unique dynamics differ from those of larger firms. The findings from studies done in large firms may not apply in SMEs. Understanding and mitigating the negative effects of politics can foster a more engaged and productive workforce, which is especially important for the success and sustainability of SMEs.

What practical steps can SME owners and managers take to mitigate the negative effects of organizational politics?

SME owners and managers should prioritize strategies that promote transparency, fairness, and open communication. This includes fostering a culture where employees feel valued and respected. Implementing a strict code of conduct at the workplace is crucial, ensuring that the code is understood, observed, and enforced. Managers should reward desired behaviors that align with the code of conduct while punishing behaviors that promote negative organizational politicking. These steps help detoxify the workplace and create a more positive environment.