Alan Canton knew that developing a sophisticated new software product would present a few management challenges. The president of Adams-Blake Co. in Fair Oaks, Calif., would be overseeing an 18-month project in which 12 programmers, working in three teams, would write some 200,000 lines of code. When completed, the Web-based accounting software would serve as the company's premier product, replacing two less sophisticated programs that were to be mothballed. Getting it done on time and under budget was key and Canton, 57, knew he'd have to wield both carrot and stick with great skill to make sure that happened.

Canton's first real quandary presented itself about two months in. Reviewing one team's progress, he noticed that one programmer's coding differed markedly from that of his teammates. "I called him in and asked him why," Canton recalls. "He told me that he'd never had the chance to see the work the others did." Why not? "They wouldn't show it to him."

Canton investigated, and found that indeed, three members of the programming team had joined forces. They held informal meetings of their own, helped solve one another's problems -- and essentially ignored the two other teammates. Canton knew that daily life had to be pretty miserable for the two guys who were shut out of that cozy little cabal. But he was more concerned about what it might mean for the development project. "I had deadlines to meet, a budget to keep, things that needed to get done," he says. "I needed five people to do it, not three."

Canton's task as manager was clear: He had to bust that clique. But how?

It's tempting to dismiss cliquishness as a relic from high school, along with midterms, lockers, and prom dates. But the fact is, adult workers often behave much more like teenagers than they care to admit. Put people together in any group and it won't be long before they coalesce into subgroups, says Virginia E. Schein, an industrial psychologist and professor at Gettysburg College. "We grow up and move into organizations, but we don't necessarily change much," Schein says. That's not a problem if groups remain reasonably inclusive. But as Canton learned, a benign subgroup can rapidly become a malignant clique. And the issue is much larger than simply wanting your employees to be nice to one another.

Cliques can have a profound effect on an organization's productivity, says Rob Cross, professor of management at the University of Virginia's McIntire School of Commerce and co-author, along with consultant Andrew Parker, of The Hidden Power of Social Networks: Understanding How Work Really Gets Done in Organizations. The book grew out of a study of 60 companies at which Cross mapped employees' informal connections with one another -- who they turned to with workaday questions, who they socialized with, and so forth. Cross found that employees rely extensively on these informal networks to get their jobs done. In fact, according to Cross, the more co-workers employees know, and the more aware they are of their colleagues' particular skills, the easier it will be for everyone to share information, solve problems, and perform at peak productivity.

Cliques get in the way of all of that. People shut out of a group seldom talk to those on the inside, Cross found. Similarly, those in a clique don't tap into the expertise of outsiders. In other words, if you've got cliques, your company isn't as productive as it could be, and you're probably not getting full value from your employees.

Alan Canton couldn't afford to get less than full value from his staff. So, he decided to end his next companywide meeting with a strong statement. "I'm the one who's writing the checks for this team," he said. "This is a team effort. If I come across any instance of anyone withholding information from anyone, they're out the door." He calls it his "big stick" approach, and says that it was effective. The cabal of three began including their two colleagues in their work -- and Canton was relieved when the new software was completed on time and on budget. "These guys were young, they didn't have a lot of time in the sandbox," he says. This made them more responsive to a "tough love" approach, he believes.

Threats may result in short-term clique dispersal, but experts say they may not be the best way to clique-proof your business. "It's a Band-Aid approach," says Joshua Estrin, a consultant and psychotherapist in Plantation, Fla., who counsels small-business owners.

Cliques generally become a problem during periods of uncertainty, such as when job cuts loom.

A more effective approach may be to examine why the cliques formed in the first place. Experts say cliques generally become a problem during periods of uncertainty, such as when job cuts loom or senior managers squabble. Other warning signs: when one group of employees is physically isolated from the rest of the company or when some employees have a prior relationship. At Canton's company, for example, it turned out that members of the clique of three had all worked together in the past.

Another common problem is an office environment in which it is difficult for employees to get to know people outside of their immediate group. Social connections among co-workers -- however faint -- make it easier for people to reach out to their peers on work-related matters. They also make it more likely that a colleague will respond to a request for help. You can't mandate friendship, of course. But you can encourage employees to develop personal ties. An employee directory, for example, might include professional qualifications, as well as information about hobbies or answers to questions like "Describe an ideal vacation you've never taken" or "Who would you like to be stuck in an elevator with?" Says Cross: "When people look at information about a colleague, it's the personal information that they always read first."

You've probably noticed that when given the chance, employees tend to congregate with people who are similar to them in age, race, education, and gender. Such clustering is known as homophily, or the tendency to seek out those who are similar. Managers need to work to mitigate this natural human instinct, says Cross. One way to do that is to create projects that involve people from different groups within your company. At Dixon Schwabl Advertising, a 70-employee firm in Victor, N.Y., for example, a rotating team of four to six employees plans a companywide event each month, such as paintball or horseback riding. While the events are good for team-building, the planning process itself is what keeps cliquishness at bay, says Lauren Dixon, the company's CEO, who once had to fire a group of employees after they formed an unproductive clique. The teams at Dixon Schwabl are deliberately designed to expose employees to people they don't normally work with, such as a senior exec and a delivery person. "Everyone has equal input," Dixon says.

Finally, while addressing the behaviors of your employees, don't forget to take a good look at yourself. It's not uncommon, after all, for a company's head honcho to create an inner circle. That's just a polite way of saying clique, says Estrin. Dev Patnaik, managing associate at Jump Associates, a research and consulting firm in San Mateo, Calif., with 30 employees, readily admits that he has a group of senior executives that he considers his key advisers. But about a year ago, Patnaik took steps to make sure that he wasn't becoming entrenched in a clique of his own by asking a junior staffer to serve as his assistant and his shadow. Whatever Patnaik does -- making a sales call, running a meeting, giving a speech -- the assistant is there, watching and learning.

It's a learning experience for the junior staffer. But it's also a way for Patnaik to keep himself from becoming isolated in his own company -- a dangerous situation for any entrepreneur. "This has been great because I get to know some of the younger folks much better," he says. "And I get an understanding about how things happen on the ground -- I'm always saying, 'Wait, wait, we do what?"