At McBride for Business (www.mcbrideforbusiness.com), and the R. Shawn McBride Law Office, PLLC (www.mcbrideattorneys.com), we spend a lot of time on partnerships – planning partnerships, preparing them and protecting them. This is embodied in The 3 Laws of Empowerment (www.rshawnmcbridelive.com/3laws), and through our experience, we’ve seen things that can harm partnerships.
After much study, we start finding certain themes that are common in partnerships that are not successful versus the ones that are successful.
What have we learned? What has our experience taught us? There’s one hidden dagger in many partnerships – miscommunication. The successful partnerships spend a lot of time early in the process of communicating shared vision, shared purpose, shared business plan and making sure everything is in alignment.
Those that are less successful think that they have this worked out. They rarely think that they don’t have a shared vision. They rarely think that they’re not moving in the same direction. However, the partnerships that are doomed find that as the business evolves and situations emerge they find out their agreement wasn’t as strong as they thought it was. They figure out there was a hidden problem.
Usually, they had different visions of what the business is and often this is not intentional. The partners are going along thinking that they have an agreement and that they’re talking similar language. They agreeing on the surface as far as what the business is and what the future is, but the devil’s in the details and low and behold a few years later a problem crops up and boom we have a major issue. Partners are disagreeing.
Then the partners get defensive. They don’t trust each other. Meanwhile, the business isn’t moving forward, and it may even result in litigation.
What do we do? How do we avoid this kind of situations happening before they happen?
Here are some practical tips:
# 1 We need planning. We need the partners to get together and really plan. Not just talking vague generalities, not just having a verbal agreement, but really write down things and agree about what the business is and isn’t – the vision, the exit strategies and all the critical details that need to be written down and agreed to.
# 2 Involve others. One written and agreed, run your plans by others. Make sure they make sense. Make sure the business is coming together the right way.
Let others check your details to make sure you have them right. Talk to trusted advisers, whether it’s another business person or somebody you’ve hired to be on your team to make sure everything’s coming together correctly. Really vet things. Update your business plans, keep in constant communication from the beginning to the end – because miscommunication can be such a killer. It destroys trust and can hurt the business.
#3 Revisit and update your plans. As you learn, revisit and update your plans with the evolution of time.
#4 Protect the Value. Know that you and your partner may split ways as no set of partners will agree forever on the future of the business. But if you do split ways, make sure there are mechanisms in place to split the value rather than go into costly litigation. Better to walk away with a check you don’t like than get nothing for years of effort.
What’s been your experience? Have you been surprised when a partnership went an unexpected direction? What have you done in the past? What are your strategies to minimize disruptions? Share with us in the comments below.
Make sure you download our free checklist to assess your business: www.mcbrideforbusiness.com/BlogGift
This posting is intended to be a tool to familiarize readers with some of the issues discussed herein. This is not meant to be a comprehensive discussion and additional details should be discussed with your attorneys, accountants, consultants, bankers and other business planners who can provide advice for your circumstances. Each case is unique. Past results do not guarantee future outcomes. This article should not be treated as legal advice to any person or entity. Freeimages.com/photographer Keigirl.
About the Author
Shawn McBride is the Chief Innovation Officer at McBride For Business, LLC. His signature keynote, The 3 Laws of Empowerment (www.rshawnmcbridelive.com/3laws), gives audiences an entertaining look at how they can prepare, plan and protect themselves. You can reach R. Shawn McBride at email@example.com or (214) 418-0258.
Get Shawn’s latest book: www.mcbridebook.com
Add us on Twitter: @McBrideForBus #McbrideForBusiness #3LawsofEmpowerment
Like us on Facebook: https://www.facebook.com/mcbrideforbusiness/?fref=ts