When Tension Strikes: Effective Ways to Manage Startup Challenges

The startup world is a hotbed of innovation, creativity, and passion. But with that intensity comes inevitable conflict. When opposing ideas clash, tensions rise, and growth stalls.

While some tension is healthy, it’s crucial for startups to recognize when conflicts have mutated to unbearable and destructive levels. When teams become divided, stakeholders lose faith, and the entire company culture suffers – it’s when teams have a serious predicament.

Moreover, startups – just as much as your advertised greedy corporation – are vulnerable to toxic relationships, microaggression, burnout, and human capital loss. With 90% of startups headed towards failure, by nature, it’s fertile soil for power imbalances, differences of opinion, misunderstanding, disagreements, and eventually total collapse. In fact, a Harward Business School professor, Noam Wasserman, argues that 65% of startups fail because their co-founders couldn’t settle on common ground.

So what can founders do to recognize the potential fallout from unresolved conflicts? More importantly, what proactive changes can they make to prioritize psychological safety and foster open communication? 

In this article, we’ll explore strategies to help startups manage conflict effectively, act against signs of destructive tension, and create a healthy, productive team dynamic.

#1 Clash of egos or constructive collision?

When a former Twitter India chief (Manish Maheshwari) and Microsoft senior engineer (Tanay Pratap) meet to build a promising platform, you know the thing is advancing towards a big success. 

Well, turns out you don’t. Indeed, Metaversity looked good on paper, hence 5M in capital from investors… but the swanky, neat, and polished software (and a company booming with talent) got bitten by unbending, opposing visions of the company. The egos clashed so hard that investors – desperate to save a company – proposed a payout of $100K for Maheshwari to leave the company. Seeing the offer, Maheshwari turned his head away and two founders, in a new-found unity, slowly turned Metaversity into a no-no lesson for articles of this kind. Simply put, compromise was never an option for either side. Sadly, neither was a success. 

Although you may have been led to believe this story is that of Metaversity, it reaches way further than one doomed company. It’s an immortal story of the majority of startups that steer off course due to the inability to separate egocentric clashes from constructive conflict. A snake from a ladder.

A little tweak in approach could possibly change the outcome of such projects. A pinch of self-awareness in one’s own actions (especially for founders). A question is whether or not the conflict is helping the company advance or it’s just protecting someone’s position of power. 

If co-founders or other team members are often involved in repeated discussions, a good step forward would be to keep a log of their arguments. Since, the conflict will be a tad harder to control in the moment, a history of their discussions could help everyone understand the full picture – especially parties involved in a conflict. It should also help teams identify and remove unhealthy behaviors that reduce individuals’ and teams’ safety, comfort, and performance.

#2 Avoid conflict debt

No organization is free of conflict. There are only those that avoid it and others that learn to manage, even better, leverage it. Shoving the problems under the blanket will only invite frustration, a sense of inequality, and dissent. Consequently, it leads to feelings of resentment, gossip, creating group divisions, and resignations (and lots of it).

When teams opt to sidestep conflict, a detrimental phenomenon ensues. They sink deeper into a conflict debt, where unaddressed and unresolved matters accumulate to unfold a far worse turn of events within the startup. This debt can manifest in various ways. It ranges from the seemingly trivial act of withholding feedback that could help colleagues perform better to the dilemma of postponing the strategic determination of when to expand the new product line.

Now, a reason this prevalent debt burdens us is this. We’re biologically wired to dodge the unsettling feeling the conflict provokes. To make things worse, we choose to stay loyal to the opinion of a group of people we spend more time with instead of the “right one”.

To foster productive conflict, psychologist Liane Davey proposes a methodological but simple approach. She advises teams to anticipate tensions within a team. To embrace them as an integral part of the process. By putting the characteristics of desirable, healthy, and productive tensions on paper, you can resist the thought that diverse perspectives are dysfunctional. To normalize conflict you can embark your team on an exercise that involves mapping out each role and identifying the inherent tensions that could naturally arise among them. To let this practice pave the way for a more harmonious and effective collaborative environment, Liane suggests you:

• Determine the unique value of each role on your team and what you’d miss if the role wasn’t there at all
• Map out which stakeholders this role serves and who defines the success of it
• Write the most common tension this role provokes in other teams

#3 Absolute transparency and accountability

Accountability is pivotal in a startup’s growth. After all, how do we expect employees, customers, and partners to put their trust in a startup they don’t have absolute control over? The most exceptional talent, what draws them towards startups and leaders is unequivocal trust. For customers, they’ll choose to buy products from companies that don’t fail to display dependability. Partners, too… They seek to build relationships with startups that truly walk the walk and breathe life into their promises.

Another crucial reason why you’d want to instill accountability is to stay free of unnecessary tensions. As we said already, as a startup you’re bound to have constant disputes and challenges along the rapid growth. It comes with a territory. Putting external stakeholders in a constant fog and giving them reasons for doubt your venture will not only create more conflict. It will amplify existing tensions with your team so much so that an omnipresent pressure will feel torturous. In order to uphold accountability, you can develop a rigorous routine of sending monthly or weekly reports and be diligent and extra detailed about it. Founders have attested that external accountability, joined by the habit of disseminating monthly updates, can serve as a catalyst for future growth and stout relationships. Beyond the mere act of sending these updates, this practice fosters a heightened sense of purpose and clarity of direction both to internal and external stakeholders.

#4 Amplify the voice of even-handed, unbiased parties

Within every conflict, there are two opposing sides. However, amidst the chaos, another group can be found: the spectators. These people that choose to watch and note may pose a unique ability to employ stoic wisdom to comprehend the situation and bridge the gap in understanding. Among spectators, startups could weed out the individuals that transcend the innate biases that often cloud decision-making. Intuitive sense of rationality, stoicism, and patience— signs of level-headedness your startup is probably craving right now.

These individuals are an invaluable resource. Especially in times of magnified tensions. To effectively navigate conflicts and move beyond unnecessary arguments, it becomes essential to identify and amplify the voices of these individuals. Even if their perspectives are occasionally different from yours or may unsettle people’s feelings, they serve to keep your startup on a steady course forward. 

We understand that many startups may not yet have established HR teams or onboarded psychologists as unbiased facilitators. Nevertheless, regardless of your startup’s current size, chances are there are individuals who cherish unbiased traits more deeply than others. Recognize their potential and empower them. If you’re wondering what to look for…

• They seem comfortable in their own skin, with both their strengths and flaws
• They accept responsibility for their work
• They seem to be aware of the consequences their actions have on people and circumstances
• They intelligently clarify ideas and summarize the crux of the matter in meetings 
• They seem to be better with words than most people
• They get facts straight
• They don’t draw conclusions before they fully understand the issue
• They have steady daily routines, families, intimate group of friends, and relationships

Embrace their insights. They hold the key to fostering a more harmonious future. By doing so, you subscribe to a wellspring of guidance that can steer your startup toward uncharted heights.