One of the qualities you need as a manager is having proper conflict resolution skills. No matter how great a workplace is, there will be instances when conflict will emerge among employees. This is not a sign that things are going wrong. It could simply be a disagreement, misunderstanding or clash of personality.
Solving Conflict Among Employees:
Go to a private place: Find a quiet and private place where the conflicting parties can talk privately and freely, especially if you have an open office. You do not want a situation where they feel humiliated as you try to solve their conflict in the open.
Listen to both sides: Resist the temptation to take sides during conflict resolution. Genuinely give each party a chance to express themselves so that you understand the genesis of the conflict. This gives you the insight you need to make an objective and fair decision.
Focus on peace: Do not gloss over the issues by forcing the conflicting people to bury the hatchet and return to work. There are many effects of unsolved conflict, including the fact that there will be a lot of resentment in the process. This ultimately affects productivity. On the other hand, do not stir conflict by exaggerating the gravity of the conflict. Keep reminding the employees of the importance of focusing on co-existing. This depends on the gravity of the source of conflict.
Be fair but firm: If you want employees to take you seriously, you must be fair and form during conflict resolution. Remind them of consequences and go through with it. For instance, if the source of conflict was because an employee was being unethical or disrespectful with the other, follow it up with a cautionary letter or a reminder of the code of conduct.
At the end of it all, you need to come off as in control and dependable. You do not want to give an impression that you are not able to mediate between conflicting colleagues.