You may have heard that people who go further and those who go alone go faster. Either way, partnerships could mean working towards a common goal. They could also mean working on the same cycle of goods, services, and information. This means the parties will need each other’s help to achieve their own goals. For example, sole proprietorships could partner up with suppliers to get the products they need while suppliers gain financial value.
Strategic and best partnership practices will help develop a healthy and fruitful business relationship. However, there are those that end in conflicts and could even end up in court which is a costly affair and could damage your business reputation.
How Do You Ensure Your Partnership Is Fruitful?
We can break down how to run a successful partnership into three major stages.
- At the start of the partnership
Before you get into a partnership deal, you will need to make some considerations that will affect the outcome of the partnership and potentially the results of your venture. The steps to take before the partnership are:
1. Personality and skill check
What is the business personality of your potential partner? Is he or she an optimist, a realist, a strategist, doers or a cynic? Their business personality is like their strengths. The strategist, for example, will see the bigger picture and the cynic will be able to provide a cautionary approach to business.
What are the skills of your partner? Do they complement your skills? If you both have the same skills, it means the business will grow slower. However, a team that has diversified skills, will double the productivity of your team. For example, a tech expert and a marketing expert give the business two departments both of which contribute to the growth of the business.
2. Are your values aligned?
As mentioned earlier, your goals may differ slightly but your partnership is necessary. However, you should consider if the other values of your partner are in the interest of your business. What is your partner’s dream? What is their vision? Ensure that you have a similar work rate and vision. It will give you an easier and enjoyable time translating the vision into action and achieving various milestones.
3. Generate partnership documents
What are the terms of your partnership? First, agree on the role each partner will play and the rewards. Once everyone is content, you can produce the following main documents:
- Memo of Understanding
The memo of understanding is not really a contract but a definition of agreed roles, responsible parties, and due dates. It sheds light on some of the organization’s activities.
- Partnership agreements and Share documents
These are legally binding documents. You may have a lawyer present of the lawyer to have custody of the copies of documents. The documents should also state the rules of the partnership. If any of you violate contracts or legally binding documents, the conflict can be settled in court.
- During the Partnership
Here are some of the best practices to ensure sustainability during partnerships.
4. Information free flow
Communication is an integral part of any business or any other relationship. It will help build trust, facilitate growth, and tackle challenges effectively and on time. You will also know customer needs and how to address them effectively and efficiently. In case, you feel oppressed in the partnership, you should speak up. Silence in such a situation may hinder your productivity in the business.
5. Build trust
Consistency and honor build trust. It is a good idea for each partner to have a sense of equity, especially in long term business relationships. Yes, you will need to provide accountability but a sense of equity can be promoted by casual acquaintances. This means that to a rational scale, you will not keep track of all the benefits your partner has received and this will promote him to contribute more to the business.
6. Proactive conflict management
Conflicts can damage relationships and good business projects. Successful partners mostly rely on proactive conflict management. Some proactive measures to conflict management are:
- After the Partnership
What happens when the partnership ends?
7. Possibility of future projects?
It depends on how the partnership and project ended. A successful partnership could bear another project. You could also mutually agree to part ways. After the partnership, take some time and figure out what you learned, what you could change in upcoming partnerships and what you would want to keep.
There are various forms of partnerships. People are an asset to your business for the skills and perspective they contribute towards goals. Furthermore, in successful employee management, employers should make their employees feel like part of the company to optimize performance.