Invisible Business Losses: Why Internal Conflicts and Executive Burnout Eat Into Profits

We continue exploring touchpoints and leaders’ critical mistakes.

A satisfied customer is not the sole victory of a front-office employee or a department head, but the result of the well-coordinated work of the entire company. And here it is important that the leader does not lose contact with colleagues and business partners. Unfortunately, a gulf of misunderstanding and resentment often arises between departments. Psychologically, this begins with the “we” and “they” effects. The “we” effect creates a unifying sense of belonging to a group, while the “they” effect creates a sense of detachment from people in other groups. These two phenomena are exacerbated at moments when interests overlap and conflict situations arise between departments and companies (contractors and clients). The result, as a rule, is strained relationships that can provoke constant disruptions not only in change initiatives but also in day-to-day operations. To increase efficiency and alignment in working with other departments, it is necessary to create, document, and track the fulfillment of mutually comfortable agreements on joint work. At the same time, it is important to be sensitive to emerging misunderstandings and clarify the situation in the moment, changing agreements if necessary.

In one travel company, a decision was made to automate part of the processes, and already at the stage of collecting expectations, it became clear that due to a lack of trust in the IT department, many teams were sabotaging the process. This was related to frequent situations of “cool,” formal attitudes from IT staff toward the difficulties users were experiencing. After several meetings and one-on-one conversations, the IT team collected feedback on their work and requests regarding the plan for implementing the new system. Based on the information received, an automation implementation plan was created. As a result, the team of department heads established agreements on the stages, clearly dividing areas of responsibility and specifying sanctions for failing to meet commitments. The automation was successfully implemented.

A leader can see areas for growth and introduce tools to increase efficiency, first and foremost, by being in contact with themselves. Such contact can be severed by emotional burnout. The main sponsors of this condition are usually an irregular work schedule, toxic communication, hyper-responsibility, and perfectionism. Unfortunately, employees, like children, quickly pick up these vices from their leader. Such a Molotov cocktail will mercilessly reduce the team’s effectiveness. Productive work in such an environment becomes a difficult task—people aren’t working, they’re surviving.

To overcome this problem, as well as others mentioned earlier, it is necessary to create a culture of respect for oneself, for others, for one’s personal space, and for the right to opinions and mistakes. In such an atmosphere, changes and challenges strengthen and develop the team.

Building such a management culture will allow the leader and their team to feel energy and excitement in achieving goals, as well as establish well-coordinated teamwork, which will ultimately lead to increased efficiency.

We will talk about how to build an effective communication culture at all levels on September 10 at 10:30 at the 10th Anniversary International Real Estate Business Forum. Join us!