FROM ESCALATION BACK TO STRATEGIC GOALS
How in 2 weeks we found the causes of the conflict.
The result - conflict ceased, emotional pressure lifted, the owner back to strategic goals
This is a deep dive.
For those who want to see how we decode complex team dynamics
— and turn invisible patterns into business clarity
ABOUT THE CLIENT
The company operates in the financial markets. It was established two years ago based on two affiliated companies. The business has seen exponential revenue growth (tenfold in the last year), and the product is in high demand in the market.
The startup consists of nine people, with three key departments, each led by its own manager.
The owner, who is also the CEO, manages the team
PSY Element:
What would you like to work with?
owner:
We have a conflict between two key employees in our team: a lawyer and an accountant. The entire team is on the accountant's side and insists on the dismissal of the lawyer. But I don't want to do it, I want to deal with the causes of this conflict.
PSY Element:
Why did you decide to contact organizational consultants?
owner:
We tried to resolve this conflict on our own, but it didn’t work out. We brought in a senior partner from another firm, but when he delved into the problem, he realized he couldn’t help. We also organized team-building activities to ease the tension, but that only lasted a couple of weeks before everything returned to the way it was.
We know that a conflict in a team is always something more than a confrontation between two people. There is always some systemic problem in the company behind the conflict. And until it is solved, there is no point in working on relationships. Therefore, to understand the root of the problem, we start with diagnostics
CONTRACTING

  • At the start we informed the owner that we would be on vacation in a month and that we would have enough time to conduct the diagnosis and provide a report within that month. However, at the contract signing stage, we encountered an issue where the accountant (one of the key figures in the conflict) was not approving our contract and requested changes to the wording. This prolonged the signing process.

  • And when we concluded the contract, there were 3 working days left. Therefore, we offered to start the interviews immediately after our return. The owner agreed, but asked us to contact the staff in advance.

NOTES ON CONTRACTING PHASE

We pay attention to the form and content of our communication with the client. This communication contains valuable information that helps us understand and solve the client's problem. Here we paid attention to 2 things. We're just recording it and coming back to it later after the interview
  • An important role of the accountant
    The accountant seemed to have deliberately slowed down the process of signing the contract and focused his attention on the little things. This made his role the leading one, and the owner could not resist it
  • Lack of time
    When we were asked to contact the employees before the vacation, we thought that the owner had artificially created a feeling of lack of time, when at the beginning he delayed the process, and then accelerated it
DIAGNOSTICS
After signing the contract and returning from vacation, we started diagnostics
DIAGNOSTICS INCLUDED THESE STAGES
Analysis of open sources
We analyzed open sources information to see the image of the company in the outside world
In-depth interviews
Interviews with the owner and key employees gave us valuable information on the current problem. As well as the way of communication within the company
Analysis of consultants' dynamics
We observed our feelings and behavior during work. It is important as the team of consultants begins to "play" the same dynamics as the client's while working with the client
ANALYSIS OF OPEN SOURCES
Usually, before the start of the interview, we conduct an analysis of open sources - website, interview, media about the company, etc. But since our client does not have a website and publications, we turned to the reviews of employees on job search sites.

WE NOTICE SOME RECURRING PATTERNS


  • There is a lack of cross-functional interaction among employees
  • There are no business processes in place for projects
  • Employees are given a lot of freedom in decision-making
  • There are many new and non-standard tasks
INTERVIEWS
At this stage, we conduct interviews and watch how they take place
PREPARATION
Before the interview, we prepare a list of questions. They are based on a psychoanalytic approach, which allows us to learn the "hidden layers" of the company - how the business task is described, what fears it causes, how employees protect themselves from these experiences, etc.
"Hidden layers" help us see how the company functions as a system and what hinders it
List of questions
INTERVIEW WITH THE OWNER
Here’s what we noted from this interview:
  • No planning
    Due to rapid growth, the company has no planning for goals and income
  • There are no project managers
    This controlling function is most often performed by the accountant
  • No work being done on mistakes
    The loss of deals is not discussed within the team; the owner reassures everyone in the chat, saying, “Nothing serious has happened; let's keep working.”
INTERVIEWS WITH KEY MEMBERS
When we agreed on the time of the call,
two employees did not understand who was writing to them and why

As consultants, we believe there are some fundamental issues with trust and communication among employees in the company. It seems that informing colleagues was done in a hurried manner, without discussing the purpose of bringing in consultants and how the work would be conducted
WHAT WE NOTICED FROM THE INTERVIEWS
  • "Transitional" Process
    Work is structured in a "transitional" manner — each person does their job in a chain, one after the other.
  • There is no understanding of the overall process
    No one is interested in what their colleagues are doing; the focus is solely on individual tasks
  • There is no division of tasks
    There is no clear allocation of tasks among employees, leading to conflict situations
  • Lawyer's mistakes
    The conflict between the lawyer and the accountant arises from the lawyer frequently making mistakes
  • Ignoring messages in chats
    Messages in group chats are often ignored
  • No one understands the structure
    The most challenging question that left employees confused and unsure of what to say was about the structure of their company.
  • Division of the team into groups
    The company uses designations like “senior/junior” and “old-timers/newcomers
  • Hiring issues
    It is difficult to find employees due to the specific nature of the work (there is a shortage of available candidates)
PLUS SOME INTERESTING DETAILS
We analyze not only WHAT employees tell us, but also HOW they do it. This allows us to see the hidden dynamics in the company, which no one talks about
  • On the run
    Almost all employees were on the walk during the interviews
  • Without energy
    Everyone’s phone or laptop was either running out of battery or they were finishing their coffee during the interview
  • No time
    Some interviews were rescheduled multiple times
  • No privacy
    nterviews were interrupted when a third person entered the room with the employee
These observations tell us that the company has a problem with roles and their boundaries, as well as that employees may be close to burnout

OUR THOUGHTS

We collect all the information we received from communication with the client, open sources and a series of interviews. We are looking for "keys" that will help us formulate the hypothesis.


Here's what seems to us the most significant:

  • the company has too much client flow, which is difficult to process by the current team
  • three key employees without assistants
  • employees do not have an understanding of the general process
  • high cost of a mistake
INTERNAL DYNAMICS
Usually, after a series of interviews, we hold internal meetings where we discuss our feelings while working with the client and our dynamics. It is important because when working with a client, our team of consultants has the same process of interaction as the client's team, so called "parallel process". Through this analysis, we can see what we were not told in the interviews
To distinguish the client's dynamics from our own, we observe behaviours that are atypical for us and reflect on how they relate to the client's challenge
Problems to define the project manager
  • Meanwhile, we were working on another project, which led to confusion about who would be the manager for this project and the other one.
  • As a result, we mixed up roles and duplicated each other's work. Also, there is no project manager in the company and each time this function is performed by different people, but most often an accountant. It is he who controls the process and is forced to constantly violate the boundaries of his role. Here we recall his important role in the process of signing the contract
Corrected each other's mistakes
  • When reading internal reports, we corrected each other's spelling mistakes, although we had never done so before.
  • Errors are the main theme of the conflict between the accountant and the lawyer.
  • In the company, the cost of mistakes is high, as the shortcomings of one key employee can lead to catastrophic consequences (due to the transitional nature of business processes). Therefore, the accountant is forced to double-check the work of other employees.
We clarified the age during the interview
  • For some reason, a question about age appeared in the interview structure, although it had not been included before. It didn’t make much sense, as we already knew the ages of all participants.
  • This reflects the dynamics within the company. No one understands the structure and hierarchy or who holds higher positions. This creates confusion in the workplace, so to orient themselves, employees have resorted to determining hierarchy by age or length of time in the company (senior/junior, old-timers/newcomers).
BASED ON THE ANALYSIS WE FORMULATE THE HYPOTHESIS
The conflict highlights two main issues
- high cost of mistakes and lack of a clear structure and hierarchy
The lawyer, who constantly makes errors, demonstrates that mistakes pose a significant risk to the company
The accountant, forced to fulfil not only their own role but also that of a project manager (a controlling function), continuously oversteps the boundaries of other employees and double-checks their work
REPORT
We prepared a report outlining the shortcomings in the company's operations that we observed that indirectly provoke the conflict. We developed an action plan with a checklist for the owner and highlighted the team’s strengths that can serve as a foundation for resolving the conflict
Analytical report with check list and recommendations for the owner
REPORT DISCUSSION
After the client reviews the results of our work, we schedule a meeting to gather their feedback on the report and discuss the next steps
Discussion of the analytical report with the owner
RESULTS

What the owner implemented within three months
The owner began ticking the checklist proposed by us and introduced the following changes
  • TEAM MEETINGS
    The owner began arranging regular meetings with the whole team and with key employees. They discuss the goals and vision of their company, as well as analyze complex cases of their clients
  • HIRING
    The owner clearly saw that the "bottleneck" is lack of employees in key functions and began to actively hire new people who unloaded the key team
  • ONBOARDING
    Now the company conducts training for new employees to make a smooth entry
  • TASK TRACKER
    Now all project tasks are transparent for each employee of the company
IN THREE MONTHS
The owner shared that, thanks to the work done, the situation within the team has noticeably improved
  • Regular meetings have helped employees better understand the company’s goals and share experiences on complex cases
  • The task tracker has significantly optimized project work and eliminated conflicts over contentious tasks
  • New employees have taken on some of the responsibilities of the top team, alleviating concerns that all work depended on just a couple of employees
  • The conflict between the accountant and the lawyer has ceased
  • As a result of these changes, the team has become more self-sufficient, allowing the owner to become less involved in day-to-day operations and focus on the company's strategic development.

  • We also received positive feedback from a partner of the affiliated company who knew about this strong conflict

WHY COULD NOT OTHER TOOLS HAVE HELPED?
Training sessions, corporate events, educational programs would not have helped in this situation, as the conflict was not caused by specific individuals but rather by internal issues within the company. Terminations would not have resolved the situation either, as, this would paralyse the entire company (due to the transitional business process), and it would not address the company’s problems — sooner or later, they would resurface in other "symptoms."
The first step in addressing a conflict is to identify its root cause. Only then should efforts be made to resolve it.
In 99% of cases, the conflict dissipates along with other symptoms.