While many businesses are identified with certain people — Steve Jobs and Apple, Mark Zuckerberg and Facebook — such businesses were built solely on their efforts. They had partners who shared their vision, perhaps financed their venture, connected them with investors or helped market the business.
Ideal partnerships can be hard to find, regardless of variation of roles and responsibilities and ownership of business. Understanding a partner’s strengths, weaknesses and interests can help an entrepreneur forge lasting relationships which helps business thrive and succeed.
So when we enter into joint ventures, partnerships and other forms of connections, whether with a fellow investor, a supplier or a party with lesser stake in the business, there are things to bear in mind.
Identify the need for partnership
Maybe you are someone who has knack for innovation but not adept in business development, thus the need for partner who has such strong skillset. Identifying your strengths and weaknesses will help find a suitable partner who will not only complement your skill, but also do not appear to duplicate it and cause friction down the road. Unless you think you can handle all aspects of the business, you need someone who will fill in what is lacking — whether experience leadership, technical know-how or running the business the same way when you hire an employee.
Define your roles and responsibilities
You bring another stakeholder for a reason and that does not include overlapping of responsibilities. So it’s crucial to get each partner’s roles and responsibilities so that each can focus on task at hand and anticipate potential problems that might arise, and become the go-to person when similar problems surface. As business progresses, such roles may evolve, but they still need to be defined up front at the beginning to avoid conflict.
For example, you bring someone who has great marketing skills who will promote the business, create marketing strategy and formulate solutions to issues such as finding the most cost-effective advertising model. You will then defer to this person for such issues.
Discuss your business goals
While you and your partner may not initially have the same goals in mind, it’s important that it will resolve to one common goal and you share the same vision. Will you be able to reach the defined goals working together? That’s the question that you and your partner will have to affirm.
Make regular communication
Sounds obvious, but as the business grows, each stakeholder becomes engrossed with outstanding tasks or problems to solve. Without regular communication, whether morning catch up meetings or weekend business updates, there is less transparency on opportunities to grow the business nor getting consensus on approaching problems that inevitably hamper business operations.
Vendor raising fees, high employee turnover or competitor closing down are some of the issues that present opportunities or threats to the business that partners need to be aware of all the time.
Personal or phone communication is a better option especially when making clarifications or bringing out plans; email communication lacks tone and message can be interpreted in a negative light.
Respect each other
Respect encompasses multiple facets in partnership: strengths and weaknesses, working habits, personal beliefs and so on. Partnerships exist to help each other, and an act of respect can go a long way towards managing a thriving business. Supporting each other is a concrete way of respecting each other, knowing that each has limits that the other acknowledges.
Document business decisions
Verbal agreements are fine but can be a cause of discord among partners especially when miscommunication occurs. Although documenting agreements might appear like there is less trust in the organization, but this is a standard practice all parties should be aware of, so that when conflict or confusion arise, there is a reference point to get back to.
Sometimes when you think partners have made bad decisions, you just let it pass, but there are cases that you need to call him or her attention and make necessary correction in a respectful way. Similarly, if you made a mistake, admit it quickly so your partner will understand and both of you move on quickly. Without airing grievances promptly, they could blow out of proportion at some point, resulting to big distraction to the business.
Before making a formal agreement, it makes sense that you are in the same page with the above items. It’s normal to have different views, but at the end of the day, one can compromise if an opposing idea is justified, and move forward to building the business.
Partnerships in business are a perpetual work in progress. Don’t let issues that arise be swept under the rug as they always emerge anyway.