How to Prevent Petty Conflicts and Nasty Rumors From Destroying Your Startup Grudges and rivalries are a more dangerous threat to a growing company than any competitor.

I have a long-time friend who was part of a software startup company in Silicon Valley. He said that even though the idea and logistics of the organization were truly fantastic, the whole thing fell apart. When I asked him why, he said what destroyed the organization started out as petty conflicts from within. Those conflicts resulted in false rumors, which broke down the foundation of the organization. As one of the insiders, he could clearly see the rumors were completely ludicrous and based on distorted or limited understandings of one situation or another. His story reminded me of one of those sayings I heard when working on my MBA -- "Rumors destroy organizations."

Related: Is Your Company Suffering From EAD (Employee Alignment Dysfunction)? Probably.

Venting.

There's a principle I've witnessed through the years regarding how people express their negativity. First, it's quite common to have misunderstandings or get our feelings hurt on a regular basis. It's also common to vent our hurt and frustration to a friend or associate we regularly work with.

Inflammation.

Then enters the inflammatory principle. When the friend or associate repeats the story, it will be embellished tenfold. This process continues as the story is related from person to person. This results in the story being distorted every time, sort of like the game Telephone. By the time that rumor has circulated through the company, it has morphed into something huge and horrific, leaving many wondering if it is wise or safe to work for the organization.

Inevitability.

It's important to understand that rumors will happen. It's inevitable. People just can't help but spout off and give verbal expression to their frustrations and any negativity that dwells within them. The question then is not how to eliminate rumors, but how to minimize and deal with them.

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Speaking up.

So many times, people have come to me as head of my organization, saying that this person or that was going on and on, saying some terrible thing. Invariably when I ask, "Did you say anything?" they respond by saying, "No." When I ask why not, they'll say something like "I didn't know what to say," or "I was afraid I'd get into an argument or make them mad at me."

It's important to let team members know that when they hear someone spewing negativity, they should clearly, firmly, yet respectfully, say it's not okay. They don't need to make an enemy. They can say it kindly, but it's something that absolutely must be said. Sometimes the very survival of the organization can depend on it.

Collusion.

If there's a group of people that all seem to be sharing the same negativity, I will call them in and have a heart-to-heart talk to find out what is behind the negativity. It's incredible the things you find out. If it is based on rumors, then the sooner you take care of it the better. I handle these things immediately.

Believing what's heard first.

One problem I've noticed is the first thing somebody hears tends to be what they believe. In such cases, even though you can logically show what was said is false, it can be hard to change their perspective. The most effective tool to remedy that is to point it out by saying, "Just because that's what you heard first, doesn't mean it's true."

If you fall into the rumor trap.

Of course, it's too much to expect that your behavior will always be perfect. You will, from time to time, for one reason or another, become the source of a detrimental rumor. When this sort of thing happens, it's important to nip it in the bud. Go to the people you spoke to inappropriately, and clear up the situation. Know full well there is no shame in that. Rather, in doing so, you attain an honorable stature in the eyes of others. It is fine to say that, in a heated or irrational moment, you spoke inappropriately and would like now to clear up any misconceptions that might have occurred.

Related: What's the Secret to Successful Teamwork? Just Be Nice.

Preventing and addressing rumors.

A positive environment can be restored by doing the following:

1. Go straight to the source of the rumor, and work it out.
2. Model behavior free from gossip and rumors, which inspires others to do the same.
3. If a rumor has already spread throughout the company, find the source(s) of the rumor and request they correct it with the people they've spoken to. They should then ask those people to do the same.
4. Address the whole group if necessary.
5. If a particular type of rumor (for example, claims there are financial troubles) keeps occurring, find the source and address it.
6. First and foremost, create a positive spirit within the group. The purpose and intention of the organization must always be held up as a guiding light of nobility, honor, sincerity and well-intendedness. This must become a shared theme for every individual in the organization. Any momentary deviation from that must be understood as a natural human slip up. Rectify it, let it go, and move past it as quickly and seamlessly as possible. Instead of holding onto any negative feelings, hold onto the laudable ideals that are the very fabric of the organization.