BY ANDI GRAY
Dilemma: I have a partner who cuts corners all the time; I want to do things the right way, even if it costs a little more. Seems like we don’t see eye to eye very often. What should I do?
Thoughts of the Day: Start by outlining goals to be clear about what each of you expect from the company. Think about how well matched the two of you are. Communicate a lot. Resolve your differences now.
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 must be a common understanding about what concerns are big and those that are smaller.
Lay out a picture of where you each want to take the company over the next three, five, and 10 years. Look for both 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 apart.
Take stock of the big issues: start with ethics, handling finances, workload, accountability, payoff, brand value, customer base, and how employees are treated. It’s much easier if you both see the world the same way—and in some instances, it’s essential. For example, if you agree to pursue a customer base that values price over quality, you had better be prepared to make sacrifices on how the product or service is delivered. If you’re not willing to budge on quality, find out now if your partner is ready to raise prices to afford what it will take to deliver a higher standard.
Differences can add value as you apply critical thinking to building the business. Divide tasks by playing to each other’s strengths. Avoid weaknesses that might be more problematic if you were the only one running your business. Just make sure that you both respect all the different ways 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 compromise on a decision and move forward—and respect your partner for doing the same. You’re both going to make mistakes along the way, so you must allow for failure in others as well as yourself. You should also confirm that your partner is as committed as you are to digging deep in order to fix problems once they occur.
Many problems arise from misunderstandings. Agree on both how and how often you will communicate with your partner. Weekly meetings, daily email updates, written reports, monthly results reviews, and quarterly check-ins are tools that will 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 a substantive sticking point and not just stubbornness or ego.
Decide who holds the majority of shares. In most cases, majority shareholders ultimately get to be the decision-makers. If shares are split equally and no partner can make a decision without the other agreeing, set up a long-term process for resolving disputes, both the one you’re currently facing and any future differences of opinion.
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 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. [CD0816] Looking for a good book? Business Partnership Essentials: A Step-By-Step Action Plan for Succeeding in Business With a Partner, by Dorene Lehavi.
Andi Gray is the Founder of the business consulting firm Strategy Leaders. She can be reached at andi@strategyleaders.com.