Charles Helliwell's Answer:
Managing or supervising a friend is a challenge we all face from time-to-time, Sally, and is rarely done well, to the benefit both parties.
First of all, don't be too hard on yourself, as often the first and most natural reaction is one which is drawn from the emotions of the friendship.
Remember that in work as in life, there is personal; and there is professional. Consequently, your first task is to separate the two.
Behaving as a professional and responsible manager is little different from behaving as a professional and responsible individual. In fact, you may well have earned your position on your ability to separate the two; whereas your friend may be stuck where she is because she cannot.
Envy and resentment resulting in disruptive and dysfunctional behaviour is a common enough outcome, although what is less understood is that the envy and resentment mostly emanates from a lack of confidence and self-esteem.
You can overcome this by engaging positively and directly with your friend and talking to her about how much you value and how much you've learned from her key skills and qualities. By making her an integral part of your success, you will be impressing on her the importance of her role as both a friend and a colleague.
But beware of allowing this relationship to sour your ability to manage your responsibilities and make the difficult choices you will face; otherwise you may become tainted with the dreaded brush of favouritism.
It is a very fine line that you will have to walk and a very delicate balance indeed. It is one which requires much practice to perfect and is one that so many managers fail to.
There is no easy way to ask a friend to do something they may dislike, but you can sugarcoat the pill by engaging with them first and asking for their opinion or viewpoint on how best to proceed. Sounding out colleagues is a common enough practice for most managers; just as long as you remember that you and only you, must make the final decision.
And if all this fails to engage your friend in a positive and mature manner ? Then the personal side of friendship must be brushed aside for the sake of your professional integrity. The name of the game in managing any group of individuals is to raise them to a higher level than they thought themselves capable of; not lower yourself to the standards they decide to set.
Sally has a choice; what is more important to her - Her friendship with this woman or her position as supervisor.
Actually the friendship is over. The envy and jealousy of this woman has poisoned it. A true friend would have worked hard to support Sally instead of undermining her authority behind her back, which makes her a dangerous enemy. Furthermore, there will be no pleasing this woman. She expected favours out of this promotion because of the friendship and when they weren't forthcoming she turned nasty. No amount of sugary words will turn her around, she will only make impossible conditions involving preferential treatment.
She now has to be treated the same as any other member of the team. Sally should focus on building her team. If this woman does not like the arrangement she should transfer to another group, if they will have her.
Of course Sally's position as a supervisor takes precedent and the friendship may well be at an end. That's not the issue she's mostly worrying about. She's more concerned about why this might have happened in the first place and whether or not this is a reflection of her own style and ability. It isn't. It's a symptom of a deeper root cause, which I diagnose as insecurity, based on a lack of self-esteem and self-confidence. Unless and until Sally understands that her friend's dysfunctional behaviour may not be directly a result of her own style and behaviour, she will attempt to modify her own natural style of management to accomodate this. This adaptation may, in turn, create lack of confidence in her own abilities. It's important that Sally learns quickly from her experiences; not what is necessarily right or wrong, good or bad. Her key learning is that whatever circumstances may throw at us, be prepared to meet the unexpected with an open mind.
word of advice-follow up with policy on what your company requires as form of documentation in case you have to start the disciplinary process; if you have proper documentation in place with date, time, examples, etc, there is little room to argue if things progress to that next step...speaking from experience
I have a similar problem managing a so called 'friend', who has given me no support in my new role and in fact makes life very difficult for me. She expects the relationship to be unchanged which of course it cannot be. She expects me to help her with her work, but does not understand that my role has changed and I have my own work to do, which I have no help with. I have eventually decided to end the friendship which is nonexistent now anyway, because as Sandy has said- 'A true friend would have worked hard to support....... instead of undermining..... authority behind her back'. Still, it's not an easy situation.
Here is a Youtube clip with one key strategy for managing friends to help prevent the 'teacher's pet' syndrome and also allow for open accountability for performance on their part.