Successful business partnerships are an incredible testament to character, communication and well, let’s face it, fortitude.
The payoff for these traits can be great. Business partners enjoy the benefits of shared expertise, shared roles and shared success. But there’s also shared risk and, as in all human relationships, the potential for conflict.
So how do you marry these pros and cons and enjoy a fruitful partnership, that isn’t prone to constant friction? Here are some ideas to consider:
1. Settle on Goals
Before you get locked into a partnership, make sure you have a good idea of who you’re getting into business with. It doesn’t matter how long you’ve known or worked with this person before, are your goals similar? If one partner is looking to turn their hobby into a passion and enjoy a better work/life balance, while the other wants to pour every hour into creating a multi-million dollar enterprise, then you may be looking at problems down the road.
2. Have Clearly Defined Roles
One of the great things about partnerships is that each partner brings different skills and experience to the table. It’s a good idea to work these distinctions into your job roles. Instead of thinking of yourselves as sharing equal duties, approach your business as any employee-based organization would and assign roles and responsibilities. Perhaps one partner handles operations (employees, payroll, accounting, etc.) while the other is in charge of sales and marketing. If you’re both doing the same thing then you’ll tread on each other’s toes and create opportunities for conflict.
3. Don’t Be Afraid of Confrontation
Confrontation can be just as healthy for a business partnership as it is for a marriage. Don’t shy away from it. Saying what’s on your mind (I’m not advocating antagonism here) or calling a partner out on a decision or action, shows that you are both invested in its success. If you can’t tell your business partner how you feel, you can you make the partnership work?
4. Communicate and Motivate
Communication is key to teamwork. Whether you’re a head chef in charge of a busy kitchen or a football coach driving his team on, without communication nothing gets done. So make a point of communicating, or over-communicating, as much as you can. Have regular meetings, check-ins, and problem-solving discussions. Humans thrive on communication and running a business can be a lonely process, so take advantage of your partnership and motivate and excite each other at every opportunity.
5. Address Conflict ASAP
Speaking of communication, as conflict arises, and it will, make a point of dealing with it ASAP. Don’t let it linger. Discuss it, come to a resolution, and redirect your energies back into your business. It’s a good idea to come up with a formal resolution process early in the partnership.
6. Enjoy Your Time Apart!
Make a point of spending time away from each other. Have a separate life outside the office. You don’t have to be best friends. Your own social network of friends and family can provide relief and a new perspective on things.
7. Agree How You’ll Split Profits
How are you going to split your profits? How you do it is up to you (and it doesn’t have to be equal), but whatever you decide put it in writing (more on this below). Read my earlier tips on How to Split Profits in a Small Business Partnership.
8. Put Everything in Writing
Everything, from profit-sharing, to roles and responsibilities, contributions to the partnership (such as the assets you both bring to the table), decision-making (the scope of each partner’s authority to make decisions), how the partnership will be dissolved, and so on should be written up in a partnership agreement. Work with your lawyer and accountant to formalize the agreement.
9. Learn to Compromise
Another lesson we can learn from marriage – compromise. Accept that it’s not all going to go your way and you’re not going to agree on everything. As long as the business stays on course, don’t sweat the small stuff.
10. Give It Time
All of the above points, aside from the contractual stuff, will take time. For example, as your partnership and business skills mature your roles and responsibilities may change, so keep an open mind on that front. Likewise, it takes time to get to know each other’s style of working, hot buttons, how you deal with stress (which invariably follows when money problems arise) and get to a place where you’re really comfortable with each other.
For more tips on finding a happy equilibrium with your business partner read, 8 Questions to Ask Before Entering into a Business Partnership.