Dear Shmuly I’m starting a new business with a partner. How do we keep our working relationship productive for the long-term?
The relationship between partners is one of the most important facets of a business, so it’s good to hear that you’re concerned about keeping it healthy.
This relationship is like a marriage, in that communication and trust are necessary in order to make it work. Here are some key points:
- Managing expectations : It is absolutely essential that each partner understands what exactly their role and responsibilities are. The easiest way to ruin the relationship is if one partner is upset at the other for not fulfilling his role while the other one is unaware that his partner even expects those things out of him. The also applies when it comes to the reward aspect. Both partners need to be completely clear on what salaries they will be taking and how they will manage profit-sharing. This is one of the most common points of friction that I see and not being careful about this can easily sink the whole partnership. Smart partners will also set up periodical reviews of the arrangement; this lets them deal with the evolution of the business and allows for role-changes without accusations of laziness or dishonesty
- Conflict Resolution: There needs to be a mechanism that all parties trust to deal with any conflicts that may arise. It can be a mutual friend or a professional mediator, the most important thing is that this must be agreed upon by both parties before any difficulties actually come up.
- Trust: This is your most valuable business asset. A business that has partners that trust each other has a great chance of succeeding, a business without trust will almost certainly fail. You don’t have to be friends, but you do have to be sure that each partner is acting in good faith to fulfill their responsibilities and has the business’s best interest at heart. If trust is lost, the partnership can quickly turn into a poisonous thing that ruins everything it touches, and can spill out into your personal life. If one partner feels like they can no longer trust the other, they are better off dissolving the partnership as soon as possible.
A good partnership is an incredibly valuable thing. Treasure it, and always be willing to put in the work to keep it healthy and functional.
Shmuel Goldman founded Intrasphere Technologies and served as it’s COO, leading the pharmaceutical consulting firm to its place as one of the leading life sciences agencies in the world. Shmuel is available to help you plan your business strategy and systems.