Cliche #3 - Becoming a CEO

Frank's Management Cliche #3

"If you wait until you are a CEO to act like a CEO, you'll never be a CEO"

Explanation:

I adapted this cliche from one I heard when I was in the Navy and the word "Admiral" was used in place of CEO.  The meaning is the same.  Whether it be in appearance, demeanor, temperament, word choices, politeness, relationships, etc. this cliche should be foremost in the manager's mind.  One area where this cliche can be helpful is when it comes to strategy.  One of the main duties of the CEO is to set the strategic direction for a company.  The CEO must define the strategy for the organization and then mobilize all resources to carry out the strategy.   In this context, the word "act" in the cliche can be changed to "think".  Then it becomes "If you wait until you are a CEO to think like a CEO, you'll never be a CEO".   Even if there are only a few people in the group, and the manager is very junior, it is still important that they convey the strategy to the group and hold all members accountable for their role in making the strategy become a reality.  The common cliche of "Think globally, but act locally" is appropriate here also.  Even though a manager may have only a small role to play in the company's strategy, a successful manager will constantly strive to fully understand the strategy and make sure their actions are in support of the overall strategy.

Here are some questions a manager should ask themselves to make sure they are thinking and acting like a CEO:

1. Is my appearance appropriate?
2. How will my words be interpreted?
3. Have I thought this problem out thoroughly?
4. Am I treating people fairly?
5. Am I consistent in words and actions?
6. Are my decisions ethnically and gender neutral?
7. Is this the best use of the company's assets?
8. Are there any legal implications to this plan?
9. How would this look if I saw it on the 6 O'clock news?
10. Have I conveyed our strategy to everyone in a clear and concise manner?
11. Are my actions supporting the company's strategy?

Motivating Employees

Motivating a team is not an exact science.  What we will discuss in this post  is what motivates and what demotivates employees.  From that we will talk about what a manager should do to motivate their team and what they should avoid.

Today's questions:

1. What Motivates employees and teams?
2. What de-motivates employees?
3. What can a manager do to motivate his/her group?
4. What should all managers avoid in managing a group?

What motivates employees and teams?

1. Winning -Winning is the best motivator.  Everyone wants to be on a championship team.  If a manager can get every person on the team to understand their function and how their effort contributes to the group winning, they will be motivated.  Of course, defining what is meant by winning is very important and will vary by circumstances.  Creating an environment where the team expects to win is the ultimate goal of the manager.
2. Recognition and positive reinforcement - People are motivated when they are recognized for their efforts and results.  Encouragement and positive reinforcement makes people want to do even more.  Ignoring a person's efforts or harshly criticizing a person's efforts will usually not work to motivate them.
3. Respect - This comes up in every session as the foundation of a person's identification with a group and their desire for the group to succeed.  This goes deeper than a person's effort, it shows what a manager thinks of a person as an individual and a human being. Without respect there can be no motivation.
4. Autonomy - All employees want to feel they have some control over what happens to them and can shape the effort they put into their jobs. 
5. Challenging work - Work that is mentally stimulating and stretches the capability of the employee can be very motivating if the tasks can be accomplished.
6. Sense of achievement and adding value - If a person feels they are accomplishing their goals and they are adding value to the team by their efforts, they will enjoy their job and want to do even better work.  This doesn't need to mean achieving a large goal, it could be as simple as completing the days work or participating in a productive meeting.
7. Pride in work - People are motivated by their desire to do work that reflects their values and demonstrates their professionalism and ability.  Just doing the job is not what motivates people.  Doing the job as well as it can be done, or better than others can do it creates pride in work and motivates people.
8. Clear and obtainable objectives or goals - Realistic goals that are clearly defined can be very motivating to the team.  Goals that are "pie in the sky" may sound good to the manager, but will be frustrating to the team.  If the goal is to be "the best in the industry", then how this will be measured must be clearly defined. 
9. Consistency & Predictability - It is important that employees know how a manager and/or the company will react in routine situations.  Arbitrary decision making is very detrimental to morale and motivation.
10. Incentives and Rewards - Although compensation is not usually a reliable motivator, incentives and rewards can motivate specific behavior in employees. 

What De-Motivates employees?

1. Lack of respect for individuals - People are comfortable with a boss to employee difference in responsibility and accountability, but that can not lead to the manager making their employees feel inferior.
2. Unclear or unrealistic expectations or demands - Everyone wants to win.  If an employee feels that there is just no way to be successful, they will be very frustrated and de-motivated.
3. Favoritism - Every employee wants to feel that they can rise to the level of their capability.  If a person perceives that their manager has favorites, they will lose the desire to put forward their best effort. 
4. Disorganization - A department doesn't need to be a "well oiled machine", but if the manager or the organization is disorganized, a person won't be able to see how their effort contributes to moving the organization forward towards its goals.
5. Unfairness - Perceived or actual
6. Arbitrary decisions by those in authority - Respect for the competence of one's manager is sometimes rare, but one of the biggest determinants of whether a person will be motivated to contribute will be their feeling that the organization is being competently led.  If decisions from management do not make sense to employees, they will not be motivated to participate in the goals and objectives that are set.
7. Manager jumping to conclusions without understanding - It is inherent in the job of being a manager that decisions must be made with incomplete information.  Everyone would like to know all aspects of a problem before formulating a solution, but that would be a luxury in most cases.  However, a manager must know enough to make a credible decision and if a manager has a reputation of jumping to conclusions without understanding important aspects of a situation, their employees will avoid going to them for a decision.
8. Finger pointing - An organization that feels that anything that goes wrong must be someone's fault, leads employees to make sure that the blame doesn't fall on them.  A manager that looks for solutions without regard to blame will be far more motivating to their team.  This is not to say that poor performance should be ignored, but should be kept in perspective of cause and effect.  If a person's specific performance produced a predictably poor result, then it should be addressed as poor performance.
9. Poor work environment (Physical environment, temperature, equipment, etc.) - If it is too hot, loud, cold, dark, etc. it is hard to be motivated, especially if these conditions are fixable.  It is the same with tools and equipment.  If there is clearly nothing that can be done, it is sometimes motivating for an employee to overcome these obstacles.  However, if they feel that their tools or equipment are inferior to what others have, they will be de-motivated.
10. Not seeing the result of efforts - If a person doesn't see a difference between working very hard, or doing very little, they will not be motivated to do their best.
11. Work that is not seen to be adding value - If an employee does not see how their efforts contribute to the success of the organization, then they are only doing what they are told for a paycheck.  This leads to a "do the minimum" mentality.
12. Personality conflicts - This is not necessarily between the employee and their manager.  Any personality conflicts within a group will be de-motivating to everyone.
13. Inconsistency of management
14. Lack of communication with management - It is management's responsibility to keep everyone informed.  If an employee feels that no one is talking to them about how the business is going, or if rumors are allowed to proliferate, they will be demotivated.

What can managers do to motivate?
Almost everything that a manager does contributes to either motivating or de-motivating their team.  For this reason the list below is really a road map for effective management of a team.  There isn't one thing that needs to be done to motivate an employee or team; these must all be done. 

1. Show respect to all personnel - This is the most basic, but also the most important.
2. Provide leadership - Some people believe that there is a difference between management and leadership.  Maybe the ability to motivate is the difference.  Most employs believe it is the manager or leader's job to figure out what needs to be done and then they appreciate a collaborative approach with the team to figure out how to do it.  When the situation arises in any team or group where someone needs take charge, employees look to their manager to be the one to step forward. 
3. Show appreciation for work and effort - Although this can be in the form of formal recognition, it can be just as effective in simple ways of showing a person that their effort has been noticed and appreciated.
4. Listen to what people tell you - Good listening skills by a manager are critical to long term effectiveness with a team.  An employee will not want to go the extra mile for a manager that doesn't listen.  A key function of a manager is to "help" the team be successful.  The team reciprocates by trying to help the manager be successful, but many miss this because they don't listen to what their team is telling them.
5. Clearly define expectations and objectives - The more formally the better, preferably in writing.
6. Demonstrate fairness in all dealings - Fairness is sometimes hard to define, but most people know it when they see it.
7. Delegate important and challenging tasks - A paycheck may be what makes people go to work, but what makes them look forward to work is the chance to be mentally stimulated, do work that is important to the business, and to have some say in how that work gets done.
8. Be consistent - Predictable behavior by the manager keeps the stress level down in a team.  Arbitrary decisions raise anxiety and lower morale.
9. Recognize good and bad performance fairly - It is not enough to just recognize good performance.  That is what a cheerleader does.  A manager must create an accountability consciousness in his organization where everyone knows that although poor performance may not be addressed publicly, it will definitely be addressed.
10. Communicate both good and bad news openly - Employees look to their managers to know what is going on in the business and to communicate to them all relevant things that could affect them.
11. Encourage initiative and allow mistakes -  The person who steps forward to accept a large challenge and fails should be celebrated as much as the person who succeeds.  If it is only the successes that are celebrated, then there will only be volunteers for the jobs where success is certain.
12. Confront problems and don’t avoid them -
13. Demonstrate a sense of humor and have fun - This doesn't mean to constantly clown around, but if the manager clearly enjoys interacting with the group, it can be shown through a sense of humor.
14. Don’t shoot the messenger - A manager must be able to receive bad news without becoming emotional, over reacting, or blaming the messenger.  In order to confront problems, the manager must know they exist and hopefully in enough time to address them before they become unmanageable.
15. Set the example of a positive attitude - The attitude of the manager will be reflected in attitude of the whole group.
16. Provide proper tools and equipment

What should managers avoid? 

1. Favoritism
2. Sarcasm
3. Talking behind people’s back
4. Avoiding problems
5. Reacting too aggressively to problems or bad news
6. Jumping to conclusions
7. Losing composure in pressure situations
8. Allowing rumors to spread
9. Fraternization
10. Allowing cliques to form
11. Allowing people to be excluded.

Cliche #2 - Reports and Data Gathering

Frank's Management Cliche #2

"Any Report or Data Gathering that does not lead to a decision is a waste of time."

Explanation:

Every manager that takes over a new position finds that there are many reports that will be delivered to him/her that are already in existence.  It is someone's job to create these reports and submit them to management for review.  Most of these reports are a waste of time for both the creator and managers.  Some managers are reluctant to stop these reports because there may be something in them that they feel they should know.  They don't know what it is, but to question the reason for the reports opens them up to criticism or loss of credibility.  I say stop all reports and information gathering that is not leading to a decision.  That decision may be to continue the current course, or to do nothing, but it is a conscious decision based on what is in the data.  Sometimes information is valuable, or critical, for a short period of time but after the need passes the report keeps getting generated and distributed.

This is not to suggest that all standard reports are a waste of time.  Productivity reports, inventory reports, sales reports by customer/region/sales person, gross margin reports by product, etc. may need to be constantly reviewed to make routine and necessary adjustments.

A healthy organization will be constantly gathering information on the business to make better decisions.  There will be a continuous stream of new reports and a equal stream of killed reports that are no longer useful for making decisions.

By far the best type of report is one that is needed by several people to do their jobs.  The information is needed to make decisions on a daily, hourly basis.  For instance, a report that shows products that are on hand that satisfies a current or past due order would be critical for the shipping department to maintain customer satisfaction.  As products are being completed, it would be very useful to know which ones should go on the inventory shelf and which ones should be packed and shipped to a customer.  The way for a manager to know that they have produced a good report is when their group demands it, or is lost without it.

Look at every report you receive, or you generate yourself and ask if it is leading to a decision, and how important is that decision.  The best thing to do is err on the side of getting rid of as many reports as possible.  Think about what other information is needed and determine if there is a way to get it without generating a report. 

It is always a good idea to automate any routinely recurring report so that no one has to collate the data every time it is needed.  Don't think, however, that because a report is automated that it is not harmful to just keep producing it.  Automated reports tend to create noise in an organization that gets in the way of efficient decision making.  It doesn't matter how much work went into generating a report that has lost its value.  Kill it.

Overcoming Resistance to Change

The one constant in the business world is change.  All managers will implement changes as part of their responsibilities.  Some of these changes will be small and some will be large.  Inevitably some people will resist these changes.  They will either resist them openly, or more subtlety.  Every manager will benefit from a discussion of why people resist, how they resist, and what the manager can do to overcome this resistance.

Some managers think that people resist all changes; that any attempt to upset the status quo will be resisted.  Try offering to raise everyone's salary by 15% and see how much resistance is created.  People tend to resist changes that they perceive will threaten something they hold to be valuable.  To some this might be a comfortable routine, to others it may their status in the organization, to some it may be their proximity to peers or coworkers,and to still others it may be their physical location or environment.

What are some changes in the workplace that can cause people to resist?

1. Location - This means the physical location of the work.  It can range from moving to a different office on the same floor to moving to another city to consolidate factories or offices.  In the extreme case of moving to another part of the country the person may or may not have an opportunity to move with the job.
2. Role - If a person, or group of people are asked to perform work that was not in their job description previously. It could be more work, or just different work.
3. Process - This is probably the biggest area of change in the workplace.  How things are done changes.  This could be a result of any number of causes, from a new strategic direction, to just the whim of management that is hoped to make the organization more efficient or profitable.
4. Standards - Customers are constantly asking for better and better products and services.  Sometimes performance that was once acceptable, is no longer acceptable.
5. Organization - Personnel changes often cause resistance.  A person in the group is promoted, the colleagues of a person are moved around, or reporting structures change and a department is assigned under a new manager.

Why do people resist?

1. Current routine and environment is comfortable.
2. Worry about job security or pay security - Companies have not demonstrated a great deal of loyalty to employees and management makes changes to be more efficient.  Being more efficient is often viewed by employees as a euphemism for impending layoffs.
3. Worry about reduced actual or perceived status - This is particularly true for employees who have gained their status over a long period of time by doing things the way they are done.  What if some of their function can be automated, or eliminated. 
4. Worried that workload will increase
5. Doubt about advertised benefits of the change - A manager should fully communicate  the benefits of any change, but must be careful not to exaggerate or oversell.  Everyone knows that whatever sounds too good to be true, probably is.
6. Distrust of management - If management has been in place for a long time and has demonstrated that they have the employees best interests at heart, then changes will be have less resistance initially.  However, many changes come with new management, or there has never been good open communication between workers and management.
7. Decisions were made without their participation - As we will discuss shortly, one of the ways to reduce resistance to change is to involve as many people as possible in the reason the change is needed, the desired result of the change, and implementation of the change.

What are ways that people react to change?

1. Aggressive resistance (Resistor)
1. Strongly resisting either verbally or by actions - This is the manager's nightmare.  If this person can influence enough people in the group, they can derail the change.
2. Saboteur - The saboteur is actually easier to deal with if they can be caught.  Unfortunately the saboteur is not always easy to identify.
2. Passive Resistor  (Fence Sitter) - This person is not in favor of the change, but is not openly resisting it.  They are not, however, embracing the change and are doing nothing to further the implementation.
3. Passive Acceptor (Fence Sitter) - This person may be in favor of the change, but if there is a critical mass of detractors, they will not want to be seen as against them.
4. Active Acceptor (Champion) - This person sees the value of the change and is whole heartily in favor of it.  The champion is a person that can influence the fence sitters in a positive way.

What can a manager do to overcome, or reduce, the resistance to change in their organization?

1. Prepare the team for the change.
1. Discuss the reason for the change and why it is important.
2. Discuss the objectives or outcome of the change in terms of benefits.
3. Be open and realistic about the risks and obstacles.
4. Be open about any negative aspects of the change.
5. Consider and use input from all stake holders.
6. Provide training - A common cause of new procedures not being followed is that employees have not been adequately trained on them.  The more effective and extensive the training, the higher the probability for success.
7. Identify an implementation team
1. Include Champions, Detractors, and Fence Sitters
8. Provide a timeline and milestones.
9. Establish success criteria.
10. Provide a realistic view of the future state.
2. Identify what is really changing -  Minor modifications may be viewed differently than wholesale changes.  For example: a new form is being used, but the underlying program is unchanged.
3. Identify and emphasize what is not changing - Especially if rumors are rampant about the impending changes.
4. Identify those people and job functions most impacted by the change - It is not uncommon for people to resist a change that doesn't affect them in the least.  If the manager can state definitively which jobs or functions will experience changes and which will not, they can head off some resistance.
5. Identify what will be perceived as both good and bad results of the change - Don't sugar coat what will be perceived as a bad result of the change.  It does make sense to highlight how the benefits outweigh these negative or unpopular results.
6. Identify Champions, Detractors, and Fence Sitters - Try to determine who will help and who will hinder the change process.
7. Enlist Champions - Get these people on the team as soon as possible.  Ask them to speak with their peers to gain favorable momentum for the change.
8. Lobby fence sitters.
9. Focus special attention on the biggest detractors.
1. Clarify more
2. Listen to their concerns
3. Involve them in the planning and implementation of the change. Value their input
10. Make every effort to minimize the effect of the change while realizing the full benefits.
11. Don't just listen to, but strive to understand the reasons for the resistance.
12. Be willing to learn and adjust as you implement the change.
13. Weigh benefits compared to problems - A partial implementation is sometimes more desirable than a derailed or aborted change.  Consider taking what you can get and moving on to the next biggest issue.
14. Evaluate the implementation and results after the change is made.
15. Formalize lessons learned for the next change effort.

Cliche #1 - Good Decisions

Frank's Management Cliche #1

"The way to train yourself to make good decisions is to live with them."

Explanation:

Many managers make an easy decision when the consequences of that decision are not immediate.   This is especially true when a manager knows they will allow themselves to remake the decision later. 

For instance, a subordinate makes a good argument for hiring an additional two people into their area.  The manager says that sounds like a good idea based on their argument.  A month later the subordinate walks into the manager's office with the paperwork to extend offers to the two candidates the subordinate has identified after extensive interviewing.  The manager, now faced with the immediate consequences of their casual decision a month earlier, balks at allowing the hiring.  All of a sudden, the company finances must be considered, the return may not justify the expense of the two people, and the manager is concerned with what his boss will think.   What has happened is that the manager is now faced with a decision that they will have to live with and wants to consider all factors.  This is a very typical scenario.  All the factors that are now present were also present a month earlier when the manager made their first decision.  The manager now makes his subordinate start all over in justifying the new hires and introduces several hurdles that weren't mentioned the first time.

Whether or not the decision is ultimately sustained or reversed is not important.  What is important is that the subordinate can not count on the decisions the manager makes.  If the manager reverses their decision, the subordinate will have wasted all the time in acting on the original decision along with the time wasted in rejustifying the actions.  The subordinate will think twice before acting on a decision the manager has made until they know it is the "real decision".   Many organizations fill up alot of time making, remaking, justifying, and rejustifying the same decisions.  Even if the manager sustains the original decision, the subordinate will be very frustrated with the process of carrying out what she thought was a settled issue.

The environment does sometimes change between the time a decision is made and when the actions from that decision are to be carried out.  In this instance it is acceptable, and necessary to consider these changes before proceeding with the original decision.  If the changes are sufficient to make the original decision imprudent, the subordinate will understand a manager's reversal (although they may not like it).

The benefits that a manager enjoys by living with their decisions are many: 

1. The manager can be confident in their decision if the topic comes up a second or third time.  Since the manager knew they would have to live with the decision when it was made, they considered all known factors before committing to a decision.  The manager will grow confident over time that they do not have to "rethink" the decision and simply state what they decided the first time.
2. Subordinates will learn that in order to change a manager's decision, they will have to come up with a different, or better argument rather than simply re-presenting the same argument at a later date.
3. The manager will be viewed as thoughtful, but decisive by everyone in the company.  The label of "wishy washy" will not apply.
4. The time saved by both the manager and their subordinates can be considerable.

Managing Conflict

Most of what is written about managing conflict states that conflict isn't inherently bad and that conflict is needed to create innovation or change.  That may be so, but for the purposes of this post, conflict is defined as unwanted and detrimental to the company's success.  Whether it be an argumentative confrontation or physical violence, managers must be prepared to deal with conflict.  For the purposes of this post, the nuanced differences in the definitions of conflict management and conflict resolution are not important.  The strategies employed here are basically the same for both.

1. What types of conflict are managers likely to encounter?
1. Verbal argument - There is no threat of violence, but the conflict is heated and getting in the way of productive work.
2. Physical assault - No contact has been made, but there are threats of violence or violence is probable. If blows or an actual fight occurs, then the disciplinary and administrative consequences are for another topic.
3. Nonverbal aggression - The conflict is transpiring without words.  That doesn't mean there isn't communication.  This type of conflict destroys collaboration and productivity.  It makes even those not involved uncomfortable
4. Passive resistance - One or more participants simply ignore the others or won't participate in any collaborative work.  This is usually directed at a single person.
5. Email "flame wars" - Someone sends something they shouldn't and it quickly escalates with an email chain a mile long.  This usually means lots of capital letters, large and bold fonts, and exclamation marks.
2. Who are the participants, or combatants?
1. Peers in the same group - This may be the easiest to manage because both people report to the same boss. 
2. Peers in different groups - The way the respective managers of each group treat each other will be reflected in the other members of each group.  The managers must work together to manage conflict that crosses departmental or organizational lines.  This is a very important point to understand.  If the managers fight, or treat each other with disrespect, the people in their organizations will do the same thing.
3. Supervisor and subordinate - Because of the difference in authority and "power" of the participants, it is important for the supervisor to conduct themselves appropriately and it is useful to understand why the person who perceives themselves as having less power may behave more aggressively.
4. You are a participant with someone who reports to you - This is a risky predicament to be in.  If you conduct yourself well, you can gain credibility, but if you allow yourself to be drawn into unprofessional behavior, your credibility will be greatly damaged.
3. Why do conflicts arise?
1. Different opinions on how to proceed on joint tasks - This is the most basic work disagreement which starts with both sides just wanting to do good work.  If there is a right and wrong way to do things, then this is easy to resolve.  Unfortunately there is almost never a easily identified right or wrong way to do anything. 
2. Failure to communicate - If we would talk about what is bothering us instead of bottling it up until it explodes, many conflicts would be avoided.  Providing a forum for open discussion amongst the group or groups can often head off conflicts.
3. Perceived/Actual inequities (workload, preferred assignments, etc.) - This is really an underlying issue.  Usually the actual disagreement is about something else, but this is what fuels the emotion.  If one of the participants feels this way, these feelings could have been brewing for a long time and erupts over a sometimes trivial disagreement.
4. Wrong interpretation of actions or intentions - One person's statement of fact without malice can be interpreted as a put down: "If you hadn't been sick all last week, we would have gotten the order".  A poor choice of words can lead to a conflict.
5. Cultural barriers - This is really a combination of a misinterpretation of actions and intentions and failure to communicate.  An example is that some parts of this country talk fast and move fast, while others talk more slowly and seem to move in a more deliberate fashion.  The fast talkers can be seen as untrustworthy and the slow talkers can be seen as unmotivated.  Both perceptions are probably false.
4. What typically accompanies conflict?
1. Emotions (anger, frustration, contempt, etc) - Dealing with the conflict without recognizing the emotions may not satisfy the participants.  People show emotions so that others will know they are upset, and recognizing the emotions can help them let go of the emotion.  This is most effective if discussed away from the other combatant.
2. Failure to listen
3. Introduction of non-related grievances - Sometimes just figuring out what the conflict is really about can be a challenge.  There can be several layers of "noise" involved.
4. EGO - When EGO's get involved the conflict stops being about right and wrong in the eyes of the participants and becomes a contest to see who will win and who will lose.  
5. Digging in one's heels
5. What are some strategies for dealing with conflict?
1. Avoidance - Don't have the conflict in the first place.  There may be a price to pay in terms of innovation or creativity, but if the goal is to get along, avoiding conflicts may be the way to go.  There are many things the manager can do to avoid conflicts without sacrificing other areas.  Managers should be available for subordinates to air grievances, provide a good example, and provide a forum for people to communicate amongst themselves.
2. Accommodation - There may be something that the manager can do to remove the reason for the conflict by changing the environment in some way.
3. Adjudication - The manager, or person of higher authority, decides who is right and who is wrong.  This approach may work if the participants just need an answer and they aren't highly invested in their positions.  Usually this will just push off the conflict to another day and another cause.
4. Compromise - Each side yields some ground to meet in the middle.
5. Collaboration - If the manager can remove the things that typically accompany conflict (see above), the participants may be able to work through the issues themselves and come up with an acceptable solution.  This is different from compromise because there doesn't have to be give and take in the solution.  It may be something completely new that satisfies both parties.
6. Arbitration/Mediation - Get someone else to help resolve the conflict.
7. Persuasion - This doesn't happen very often, but sometimes one person is able to persuade the other person with the logic of their argument.
6. What do you do if you are called to, learn of, or happen onto a conflict?
1. Exert your authority - It is important that a manager address a conflict when they see it, or know about it.  It is important that a conflict is addressed, if action needs to be taken.  The reason is that a manager's credibility as a leader depends on everyone knowing that all issues will be addressed.  There may be issues that can be left to subordinates to handle on their own, but this is a conscious decision to stay out of it, as opposed to a decision to avoid taking charge.
2. Stay calm - It is not just the participants that are watching the manager.  If a manager comes in with guns blazing it will set the standard for how to approach conflict.  The standard needs to be professional and rational.
3. Listen with an open mind - Make sure to hear both sides before taking a position.  If the manager has a reputation of jumping to a conclusion, the participants will fight to get their side known first.
4. Separate participants if needed - The manager has authority and must use it.  The participants will know that if they ignore an order to move away they could be in greater risk.
5. Take time to "clear the air" - Sometimes this is all that is needed for the participants to cool down and rationally resolve their differences.
6. Discuss the issue with the participants separately - Here are some tips for the one on one discussion with a conflict participant.  They come from accepted communication techniques, psychology, and experience.
1. Recognize emotions - People show emotions so that others will see how they feel.  Recognizing these emotions helps the person let go of them.  Avoid a direct label.  Don't say "I know you are angry".  A better way is to say "You appear angry to me".  This allows the person to hear it in a little less threatening way, and gives the manager the ability to be wrong without losing credibility.
2. Set expectations - The expectations that need to be set are for the way people treat each other and culture wanted for the organization.  This should be done in a non-threatening way. 
3. Listen first - Things aren't always what they seem.  The manager must be open minded and just listen to each participant's perception of what happened and why.
4. Repeat back for clarity - This is a very powerful tool.  Repeating back what is heard ensures that both the speaker and the manager are on the same page.
5. Probe for underlying issues - Just ask if there is anything else that has caused the conflict.  Ask twice if needed.  If you ask, they will tell you.
6. Deal with emotions/behavior/underlying issues separately - The more noise, the harder it is to get resolution.  Separating them allows a manager to deal with them one at a time.  
7. Ask what they want to happen - Maybe their solution will be acceptable to both management and the other participant.  They may not be expressing it well and the manager can help them convey what they want to the other participant in a way that is acceptable.
8. Appeal to maturity - This has been surprisingly effective.  No one wants to be viewed as immature, or childish.  If asked to take the high road, a person usually will.  If the expectation is set that everyone will be treated as an adult, people will want to be recognized as one of the adults, especially in comparison to the other participant.  Obviously this should be done with both parties.
9. Appeal to empathy (both other participant and manager) - Just asking someone to view their actions from the other person's perspective can get them to see how they are acting.  It is sometimes also effective to ask them what they would do, or how they would perceive the situation if they were the manager.  This sometimes help them see their behavior for what it is.
7. What if you are one of the participants as the manager? - This happens frequently with lower level managers who are not yet very experienced and/or dealing with less senior or experienced workers.  Much of what has been discussed above applies here, but it is worth reiterating.
1. Stay calm
2. Don't lose the power of authority - The company's upper management, Human Resources Department,  and Legal Department are all standing behind the manager who is in the proper performance of their duties.  If the manager lowers themselves to the level of the other participant and uses volume, intimidation, threats, etc., then the backing goes away.  If the manager stays calm and professional, the other person has no choice but to obey legitimate orders.  The manager has the authority to pick the time and place that the conflict will be dealt with, and usually can accept or reject any of the ways described above to resolve the conflict.  A good manager will use this authority to their advantage in managing the conflict in an effective way.
3. Recognize why the subordinate is behaving aggressively - It is useful for the manager to understand that the subordinate knows that the manager has all of the power and they themselves have very little if the manager is acting properly.  The frustration of being over matched can cause the subordinate to try to overcome this disadvantage by being louder, or acting in a more aggressive manner.  This makes it harder, but even more important that the manager  maintain their composure and professionalism. 
4. Stop the confrontation - Use the authority as a manager to direct a time and place to deal with the problem.  Allow some "cooling down" time, but the conflict should be dealt with promptly.

Summary

1. Address all conflicts
2. Set the example with peers/superiors 
3. Maintain composure
4. Always be available for the legitimate airing of grievances
5. Treat everyone as an adult (even if they don't deserve it)
6. Appeal to maturity