I choose to believe that people are inherently good. I run my company with the same mindset. I believe my employees, contractors, clients and partners have intentions as good as mine. But when you run a company there will inevitably come a time when you will need to let people go, end client relationships, and retire partnerships in the best interest of the business. These are all difficult situations to navigate, which is why how you handle the situation will help you determine whether or not you’ve burned a bridge.

Employees often have little information about company issues despite the fact that their livelihoods may depend on the outcomes. When something difficult is communicated to you, how you react to that information says a lot about the type of leader you are. Despite the fact that these situations throw you off balance, it is possible to maintain control. Absorb the information, ask questions, and process it at your own pace. Handle the situation with poise and keep calm — whether you agree or not with the resolution. Chances are, the person on the other side of the argument will respect and admire how you handle a difficult situation.

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Here are a few things CEOs and business leaders can do to keep relationships intact during unsettling times:

• Honor your contracts. If you owe people, pay them. If they owe you, collect. Be honest and act with integrity. If you aren’t being treated with the same in return, bring in a third party to mediate — emotions should always be kept out of the conversation.
• Treat people with respect and kindness before, during, and after a transition. How you handle post-event communications, will determine if you have permanently destroyed a relationship or successfully ended it for the time being, with the potential to work together again in the future.
• If a bridge gets burned and it’s important for you to repair it, make a plan and act quickly. Relationships can be rebuilt, if both parties are willing to take the necessary steps to fix it.
• You never know how many people are impacted by your decisions, so always act with care. This is incredibly true with layoffs and terminations. Unfortunately, these are typically part of any CEO’s tenure but employees have families, life situations or health issues that will be affected so remember to be compassionate.
• Sometimes, it’s not up to you if the bridge is burned and you have to be okay with terminating a relationship.

I have made my share of mistakes in handling situations as a CEO. And nothing bothers me more than a negatively severed relationship. However, there are very few former customers, partners, or people I’ve hired and let go in my life that I wouldn’t invite into my home, even to this day. Whether they’d accept that invitation is the ultimate test.

Read all responses to the Leadership Insider question: “What’s the most important lesson you’ve learned in your career?”

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