Can this business partnership be saved? I have a partner who cuts corners all the time. I want to do things properly. Seems like we don’t see eye to eye very often. What should I do?
Thoughts of the day: Start with business partnership goals to get clear about what each of you expects from the company. Think about how well-matched the two of you are. Communicate a lot. Resolve your differences now.
How to save a business partnership
In most instances, businesses with multiple partners tend to grow faster, have greater depth, and last longer than companies with a single owner. That’s with three caveats: all partners need to be on the same page when it comes to big picture items, partners can agree to disagree on small issues and there’s a common understanding about what’s big versus small.
Layout a picture of where you each want to take the company over the next three, five, and 10 years. Look for common ground and inconsistencies. If you’re in agreement on the big picture, but disagree on tactics, that’s OK. But if you’re trying to go in two very different directions, you could end up pulling the company into pieces.
Check on the big issues: ethics, handling finances, workload, accountability, payoff, brand value, customer base, how employees are handled. It’s much easier if you both see the world the same way. In some instances it’s essential. For example, if you agree to pursue a customer base that values price over quality, you better be prepared to make sacrifices on how the product or service is delivered. If you’re not willing to give on quality, find out now if your partner is ready to raise prices to afford what it will take to deliver a higher standard.
Identify issues, present solutions
Differences can add value as you apply critical thinking to building a business partnership. Divide tasks by playing to each other’s strengths. Avoid weaknesses that might be more problematic if you were the only one running the business. Just make sure that you both respect that there’s more than one way to reach an end goal.
If either of you is a control freak, be prepared to let go of that inclination now or think twice about going any further as partners. You can’t spend all your time second-guessing or countermanding each other. It’s wasteful and unnecessary.
Make sure you both can make a decision and move forward — and respect your partner for doing the same. You’re both going to make mistakes along the way. Make sure you can allow for failure in others as well as yourself. Also, make sure your partner is as committed as you are to digging deep in order to fix problems once they occur.
Agreements will save time and money
Many problems arise because of misunderstandings. Agree on how and how often you will communicate with your business partnership. Weekly meetings, daily email updates, written reports, monthly results reviews, and quarterly check-ins are all tools to help you communicate. Use them. Err on the side of over-communicating and make sure your partner is prepared to do the same.
If you disagree on a fundamental issue, such as ethics, don’t kid yourself. Move on now before you’re any more invested. Just make sure that it’s really substantive and not just stubbornness or ego talking.
Decide who holds the majority of shares. In most cases, majority shareholders ultimately get to decide. If shares are split equally, and no partner can make a decision without the other agreeing, set up a process for resolving disputes.
Set up responsibilities and authority of decision-making — CEO, CFO, chief of sales, marketing, operations, human resources, etc. Assign positions to your partner and yourself. Clarify the chain of command and what kinds of decisions need to be escalated. Make sure you can live with the level of authority granted to each of those positions.
“Business Partnership Essentials: A Step-By-Step Action Plan for Succeeding in Business with a Partner” by Dorene Lehavi.
