What does it assess?
This question is meant to evaluate your ability to work collaboratively.
How to answer it?
There is no one-size-fits-all approach to fostering positive team dynamics. Here is one way to answer this question
"In my previous job, I worked with a colleague who was very difficult to get along with. He was constantly negative and would often dismiss others' ideas without giving them a fair chance. It was frustrating to work with him, and it was affecting the team's morale and productivity.
To handle the situation, I decided to ... (fill in based on your past experiences)
The outcome of this situation was that our... (it is good to include outcome as well)
Before the interview, you can develop a story to answer such questions. Consider times in your work experience where interpersonal communication or differences in work style impacted your team dynamic