The Critical Element for Building Successful Partnerships.
In my line of work, I see the best and worst of business. I celebrate my clients’ successes, which is my absolute favorite thing. (No surprise there.) I am also beside my clients in some of their darkest moments – helping them pick up the pieces of ideas, plans or partnerships gone bad.
Lately, I’ve been working with a number of partnerships. Several have been wildly successful. A few have been disasters – to put it kindly. Over the course of my career, I’ve seen a distinct practice that increases the likelihood of a partnership’s success.
In the Beginning….
Last week, I had the privilege of working with two incredibly bright and successful teams in Washington, DC. These two teams were deciding on whether to work more closely together. After all, success breeds success, right?!?
The dialogue reminded me of many other partnership conversations I’ve witnessed in the past. Excitement runs high and the focus is on the opportunities. At this stage, I’ve heard things like – “Let’s focus on the synergies. We’ll figure out the ‘details’ like revenue sharing later. We trust each other….”
And, that right there is where things begin to go wrong.
All too often, I’ve been asked to help resolve partnership issues – where those minor details become major misunderstandings that lead to the demise of the partnerships and businesses.
When any two parties (business, people, teams, etc.) decide to work together, it’s absolutely critical to build a concrete plan that maps out all of those ‘little’ details.
It’s not the fun or sexy part of new ventures. Yet consider this, no one gets excited about the foundation of a house. Without a strong foundation, the most incredible house is lacks structural integrity and is in danger of collapse.
Every new venture needs an agreement that at a minimum maps out:
- Ownership (if applicable)
- Revenue and expense allocations
- Roles, responsibilities and expectations
- Income expectations
- Time commitments to the venture
- Exit strategy
This forces partners to slow down and have the ‘real’ conversations. Do you have differing views on money? Misaligned perceptions of your and other’s values? Different approaches to business? What happens when Partner X goes off the rails?
The conversations can be uncomfortable, hard and may even border on confrontational. Yet, they are absolutely critical. You are forging a strong foundation. Without that, you might as well be building on quicksand. You never know when it’s going to give way.
Take the time. Have the conversations. Document your agreements. Hold each other accountable.
As I said, the DC groups are smart. They decided to deal with the details first and foremost. They had the hard conversations up front and left the meeting with a new-found respect for one another, a commitment to the venture and most importantly – agreements and a plan.
I expect to see great things from them very soon.