Salespeople at Widget Co. complain that they lose sales bonuses when the production department is out of stock of a particular item. This sometimes causes customers to buy elsewhere rather than wait for the next production run. Meanwhile, production employees complain that salespeople don't appreciate the need to minimize inventory costs, for which production staff is rewarded.
This instance is an example of conflict due to:

A. rule ambiguity.
B. communication problems.
C. pooled task interdependence.
D. differentiation.
E. goal incompatibility.

E. goal incompatibility.

Explanation:

There is a scenario here that needs to be unraveled

First, the Salespeople at Widget Co have a goal of getting the highest number of customers to patronize their goods. This goal is in order to get sales bonuses on each customer

However, the Production employees at Widget Co have a goal of minimize the inventory cost during production. this goal is because they are rewarded for minimizing inventory costs. This leads to shortages that make customers go elsewhere to buy goods making the salespeople lose sales bonuses.

The challenge therefore is that their goals are different and not compatible.

Goal Incompatibility refers to the conflict that ensues when two different people in the same organisation or business unit have different goals.