Explore reasons why conflict may arise in a British SME. Overview of practical strategies to foster harmony and clarity at work with the use of Mediation. What types of conflicts are there in a small to medium size business? Are your expectations causing conflict? Is it compliance or conflict? Dealing with conflict at work. How do you rate skills? Conflict is not always a bad thing. This episode explores the type of conflicts that arise internally and externally and how to solve them
Chapter 1
Annika Female
Hello and welcome to our Conflict Stories series from an SME. You're here with me, Annika Bosanquet from CYME. I’ve been CEO of my packaging companies for nearly 25years and mentored many individuals and businesses. We are here today to share stories rather that give advice, sharing anecdotes of how to mitigate risk of conflict. We would encourage all listeners to seek legal support to run their organisation.
Annika Female
Conflict in a small and medium-sized business???? Conflict is kind of... well, it’s inevitable, isn’t it? One may think with fewer people around, it’d be easier to avoid, but, sometimes it just gives those tensions a bit more room to build. However, the great news is that conflict can also create big opportunities in its healing.
Annika Female
I've seen all sorts of reasons for conflict—internal disputes such as…. two team members clashing over work styles or leadership styles, or the classic, “Wait, who’s even responsible for this project?” moment. And then, there’s external factors, like a misunderstanding with a longtime high net worth client but this conflict may have nothing to do with the offered product or service but maybe they’re ghosting communication because they’re grappling with some heavy stuff internally. Or maybe a supplier suddenly shifts contract terms that are affecting how trading relationship. And how about the effect on an organisation from macro economic political conflict or sudden currency devaluations or even a local or global pandemic? Things were going so smoothly till these wrinkles came along but there’s slack in your business plan to cope with this, right? Yeah right, if only!
Annika Female
For me, here’s 3 common reasons for conflict in an organisation. Expectation mismatch. Poor communication. Assertion of rights. Firstly, expectations mismatch. Maybe there’s a policy no one bothered to communicate properly, or boundaries of roles and responsibilities aren’t clear.
Annika Female
Take for example, responsibilities around the compliance side? How about when those government rules and regulations shift, its distracting to keep up when trying to keep focussed on productivity. Keeping informed and having the right support in the network to manage disruptions such as taxation for goods crossing borders and there are tariff changes, changes to employment law, new reporting rules around waste and sustainability; we haven’t got enough time to bring them all in here but they’re in your business continuity plan am I right? A pre-mortem is essential. (When did you last dust that document off and get team input to review that critical ‘what-if’ plan?)
About the podcast
A series on conflict and how to avoid it
Annika Female
Here's an example we came across years back relating to Expectations Mismatch. This situation arose where a demurrage invoice came in from our shipping team because our China export broker used one export goods code which did not match the European import code for the same goods. This caused shipping clearance delays; how can the same products imported to the UK clear with different import tariffs into our designated French warehouse? And yes, that was when the UK WAS still in Europe! Although, this was when containers from China were sometimes as little as $500 dollars so, glory days in some ways.
Annika Female
And let me say, with 5 days or so to redo the paperwork to avoid another couple thousand pounds more penalties and get updated information through to everybody in the supply chain, that’s challenging! We were also subject to time zones of 8 hours between China and Europe to get things cleared up. At that time, we were paper based in all our submissions; not like now where there are online portals such as CDS clearance that the clearing agents use today.
Annika Female
Ah, but all these very early mornings suited me. Coffee charged and my steps done for the day, I was totally ready to manage these battles. Like many fellow Operational professionals, my team and I started early in the morning to call our China colleagues to be ready to catch that UK magic hour of 8am-9am which was the last hour of the China workday of 4-5pm. And my reward was that I could finish my day on time to collect my kids from school and hang-out with them till their bed time which meant the early morning stress was well worth it!
Annika Female
Now, because our mantra to always put our client's needs first when we could, to resolve the shipping clearing conflict right there and get goods moving again, even though there were a number of parties in the supply chain that were responsible in their own way, we paid the penalty so our Clients got their Christmas goods into their warehouse on time to repack and distribute.
Annika Female
We learnt, really early on, fight for our clients to stay on track but get ready for it to happen again. Take responsibility, learn from our mistakes and quickly update and integrate the changes by communicating right across the team with company wide Monday morning meetings and catch-up daily departmental meetings. Yep, although there was a ton of extra homework and back up plans to review and put in place, this helped us keep nimble and lean. We took a rear view lens to shape up for the future.
Annika Female
But it was a lesson how from our careful planning and smooth operations across sampling, production, quality control and container loading, this export drama spiralled from a question of, “What’s required here?” to “Who messed up?!” and through no fault of ours, it became a real headache to get sorted. Suddenly, everyone’s defensive. It was a classic misunderstanding simply because the line between roles and requirements was fuzzy.
Annika Female
Second: Poor communication from the top. Blurred lines if you like. This happens more frequently when a Leader expects a team to just “know” how things should be done, but never actually says it outright. Throughout the hierarchy, there are leadership conflicts, style mismatches, one department not quite trusting another. Or, sometimes, perhaps there are those personality clashes in a team where one may think, “Why don’t those two get along?”
Annika Female
It could be an interpersonal battle—someone’s allowing themselves to be pulled in too many different directions internally and quite likely harassed and harder to work with; other times, it’s a full-on department stand-off.
Annika Female
So its common, that when critiquing the team – and this is especially relevant when a new boss comes in with the idea of making things better; more productive, working with purpose for a more harmonious and healthy organisation – there will be thoughts around, “have we got all the right people on the bus?” “Anyone here who is causing splits or draining energy?”
Annika Female
Or more positively, “who are the people making things happen round here? Who brings people along with them?” This is really important if your vision is for innovation and bring about change. “Is it fun or fulfilling to work here or is there too much macho, lack of trust or a “divide and rule” culture which can be oh so destructive?”. It could simply be that some people are in the wrong role or, they are a poor fit to the company culture. Perhaps more training is needed keep skilled to do the job efficiently and keep engaged with the job they do. Is there someone bored or stuck with no further roles to get to up the hierarchy so this person appears to be trying to create opportunities for themselves that clashes with organisational vision? Or, is the market and company is going through a change; perhaps people need training or more communication to bring them up to speed.
Annika Female
Whatever it is, don’t let it continue; act fast. Seek out and listen to the team which can be time consuming or even upsetting, but it needs to be done. Treated as a period review, means that individuals are not singled out and the purpose is contextualised around key reporting; quarter ends for example. Consider bringing someone to the meetings such a person with additional HR training to witness and record and save notes to be saved on their employee file. There are some great HR softwares to help with this.
Annika Female
So, is your company culture clear? Does your customer know your company culture? Ask your client, what do they say about your organisation?Has the team been recruited with the culture in mind? Does the team even know what the culture is? Do they live it and breathe it so everyone is pointing in the same direction?
Annika Female
For example, if there are strong values around sustainability, at the most basic level, in this instance, are there recycling bins everywhere so staff can recycle their snack pots? Is the waste disposal team reporting back the amount of recycling tonnage? Is the energy supplier on a green tariff? Are there incentives for using public transport, walking or cycling to work? And that’s even before the company innovates its sustainable offering to their customers!
Annika Female
Thirdly, outliers exerting power and control definitely causes conflict. This is when the classic business “winner takes all” showdown couldn’t be starker. Perhaps two people are contesting for overall leadership; two jostling contending leaders needs to be resolved to protect harmony. In too many organisations or broken trading relationships, conflict is something to bulldoze through: someone wins, someone loses, and usually there’s resentment lingering after. This conflict can build up and exert inside or outside an organisation. So here’s where early intervention with mediation could work. Because the mediation process is voluntary, the power to resolve is left between each of the parties rather than by a judge. This means the mindset must shift from that of position to Interest and needs. The more pragmatic.... “Hang on, what about finding middle ground?”
Annika Female
What about preserving working relationships or morale?” I keep coming back to their ethos—deal with things early, keep communication open, and most of all, don’t make it critically personal. A sort of pragmatism to bring people together can lift nearly any company out of the usual blame cycle.
Annika Female
So, how what help is available? I’ve just given 3 major examples for conflict that are within an organisation control to resolve. Consider talking through a resolve with the help of voluntary Mediation, the industry Code of Practice is about handling disputes in, a non-confrontational, impartial and non judgemental way. No drama, no unnecessary battles, just focusing on solutions, right?What stands out to me is solve it rather than parties rushing to court if they can help it—very important, ‘cause I’m all about avoiding court at all costs! And while we’re taking about costs, courts are a whole lot of money. Solving a case via mediation is estimated to cost around 10% of a litigation according to ADR. Mediators support both sides to talk through things, almost like responsible adults... who’d have thought? I mean, jokes aside, this approach is definitely sensible: actively listen, make sure everyone gets their say, and help both parties get to a solution they can live with and move on.
Annika Female
Where courts focus on Power and Rights of a contract, solving a conflict for a relationship with a future requires can be facilitated by a neutral third party - the mediator - to reach what they call the ZOPA "the zone of possible agreement". By focussing on the ZOPA in order to achieve a desired outcome for both parties, which is then written up by their legal team to approve and sign off, there may be a positive future without conflict for that relationship.
Annika Female
Taking on the more official but voluntary process of hiring an external Mediator to support negotiation is that they will key communicate expectations upfront, set boundaries, and find out everyone’s underlying needs, not just what they say they want on paper for example the framework in the contract. Boundaries, clear communication, and empathy—they’re universal currencies. And, maybe it’s a bit obvious, but isn’t it more productive—and less exhausting—for everyone, if we apply those principles, especially in SMEs where every team member makes such a difference to the day-to-day atmosphere?
Annika Female
To resolve any conflict, there are the basics, listen first, don’t judge too quickly, and don’t take sides prematurely. Empathy goes a long way. Pause, reflect, paraphrase back what you’ve heard—even if it feels daft at first. Setting ground rules for tricky conversations is a life-saver.
Annika Female
A productive conflict resolution session doesn’t ignore those little personality differences. Remember, the Mediator cannot give opinion or judgment and have to be neutral. Keen on resolving will require an amount of curiosity and without judgment; to uncover Party A’s feelings and emotions and for them to review how it may be seen from Party B’s point of view or even from the point of view of what would a third person need to be able to judge this outcome rationally???? To be able to spot the gap between “this is about how we work, not who we are,” that helps manage, say, a clash between a fast-paced salesperson and a detail-focused accountant. Sure, know the legals and underlying framework of the contract and how it deviates is helpful, but moving towards the humane part and looking for that gap means, I always say, get people together early for a chat—don’t wait until it’s a full-blown row.
Annika Female
Until then, take care and remember—a good chat beats a good row, every single time. None of what I have said is new to you; just a reminder that all SMEs go through conflict especially around change. So thank you for sharing this time with me. And if you have YOU got a story to share, I invite you now to comment with your own story of a positive example on conflict.
Annika Female
Or to discuss a situation, visit www.Cyme.co.uk to contact us at Cyme for a meeting. So until our next Conflict Stories session, keep the peace.
Annika Female
Disclaimer: CYME shares stories and does not give advice so we encourage all Listeners to get legal advice to support running their organisation.