Organizational conflict remains an inevitable feature of contemporary workplaces, but its consequences for organizational growth and productivity depend considerably on the nature, intensity, and management of such conflict. This study examined the relationship between organizational conflict, organizational growth, and productivity among Nigerian firms, with particular attention to the mediating role of employee engagement and the influence of leadership style. The study utilized data from 750 respondents drawn from manufacturing, services, banking, and agro-based firms across Lagos, Abuja, Rivers State, South-East Nigeria, and other parts of the country. Organizational conflict was measured in terms of task conflict and relationship conflict, while organizational growth was assessed through revenue growth, market-share growth, and employee growth rate. Productivity was measured using output per employee, service quality, and project completion rates. Employee engagement was incorporated as a mediating variable, while leadership style and union presence served as control variables.

Descriptive and inferential results showed a consistent deterioration in organizational outcomes as overall conflict increased. Firms experiencing low levels of conflict recorded a mean employee engagement score of 3.84, average revenue growth of 13.5%, a productivity index of 109.8, and an average project completion rate of 88.4%. In contrast, firms characterized by high conflict recorded mean engagement of 2.82, revenue growth of 5.0%, productivity of 89.2, and project completion of 73.9%. Relationship conflict exerted a particularly strong negative effect, as a one-unit increase was associated with an 8.2 percentage-point reduction in revenue growth and a 9.4-point decline in productivity (p < .001). Task conflict exhibited an inverted U-shaped relationship with productivity, with the optimal level occurring around a score of 3.2. Employee engagement mediated approximately 42% of the effect of organizational conflict on productivity. Democratic leadership was associated with a 0.41-point reduction in conflict and a 6.3-point increase in productivity. The study concludes that relationship-based conflict is substantially detrimental to firm growth and productivity, whereas carefully managed task conflict may provide limited performance benefits. Nigerian organizations should institutionalize effective conflict-resolution systems, strengthen employee engagement, promote democratic and participative leadership, and distinguish constructive task disagreements from destructive interpersonal conflict.