3 Key Ingredients for Successful Business Partnerships

by | Feb 4, 2020 | Blog, Inspiration, Mindset, Tips | 0 comments

Like any relationship, the key components of a business partnership include trust, accountability and good communication. 

What are the barriers to partnering with someone outside your business?

Personally, I have felt afraid of being let down or taken advantage of. I’ve heard many stories of people who have been cheated out of profits, their bank accounts emptied and their intellectual property violated. Partnering with others can be scary but there’s no question that collaboration brings many benefits. As a business owner, it can be quite lonely to take on all the responsibility for ideas and running of the business. Others bring their insight, experience and skills to a collaboration that can be highly beneficial for both parties.

Traditionally, people have preferred to engaged in business partnerships with other people in the same location, for ease, and so they could meet face-to-face to iron out any problems. Today’s global society and technology have opened up opportunities for us to work with people in any part of the world. Partnerships across continents are now so much easier, but there are still cultural barriers that can interfere. We have expectations that people will do what we want them to do, will have the same values and will operate the way we do. Now more than ever it is important to be open about what we expect, and to communicate what we want out of the partnership in order to avoid disappointment.

Trust

The first ingredient is trust. Entrepreneurs are often used to doing their own thing and it can be an adjustment to let go of control. Personally, I love the feeling of being trusted to bring my own expertise to a situation where my contribution is valued. In contrast, it doesn’t feel good if I’m not trusted. So once things are clear and agreed upon, let go and trust that your partner will do their part. Often trust is built when things go wrong, when we have disagreed and then repaired the relationship. I’m a conflict avoider but I have seen that relationships are made stronger on the other side of a disagreement, once both parties have had the opportunity to truly express their perspective and how they feel.

Accountability

The second ingredient is accountability. It goes without saying that we need to deliver on what we promised and to take complete responsibility for everything that is ours to deliver. If you mess up, own it and fix it. People tend to forgive you if you rectify the situation proactively. A mature relationship is one in which we take responsibility for our own actions and trust that the other party does the same.

It’s clear that working together is highly beneficial. I’m currently partnering with someone to create online content, using his incredible skills and knowledge to make my content shine. I have the material but I’m not proficient in making it appealing and interesting. I don’t want to invest in a lot of equipment to do this so it makes sense to partner with someone who already has the equipment and the expertise. He is very interested in my content and loved reading my book. And he is excited to bring my content to the world in a different way. As we commence this partnership, I’m mindful of what I’ve written here. To become explicit in what I’m expecting in terms of pricing, responsibilities and how the final product will work. I’m excited to be part of something that I could not do alone but that I can benefit from professionally. I can’t wait to see what we create together.

Good communication

Good communication is the third critical ingredient for a business partnership, whether it is with someone across the globe or in the next cubicle. Be clear about your own expectations first. What do you want to get out of this relationship? What are you willing to give? How much time, effort and money are you willing to contribute? Once you’re clear on your own requirements, it’s important to communicate your expectations to your partner. These include expectations around outputs to be delivered by each person, time frames and level of quality. It’s also important to cover the revenue and costs splits. Who pays for what? When, and how, to split the proceeds? It’s important to be clear on these mechanisms before the partnership commences.

Express how often you want to be kept up-to-date with the other party’s progress. Identify for yourself how you will know that your project has succeeded and communicate this to your partner. Going into a relationship with clear expectations that are expressed, sets you up for success. And you will know that there are unmet expectations if you start to feel resentful. Resentment is a good indication that you need to have a conversation with your partner about expectations.

All this sounds quite obvious but it’s only through experiencing failed business partnerships that we realize how important the basics are. I encountered difficulties in the past with two colleagues with whom I failed to express expectations. They were both very capable people in their own fields, one in accounting and the other in IT. It was obvious that they had a wealth of knowledge and skills behind them and I’m the kind of leader who likes to offer a lot of autonomy. I let them set their own boundaries and outcomes but, in both cases, I didn’t get what I wanted out of the relationship. The deliverable was not clear and the timelines were ill-defined.

I felt disappointed that they failed to deliver and they felt unappreciated for all the effort they put in. From these experiences, I’ve learnt that before the relationship begins, it’s best to set out expectations and to communicate them explicitly in writing. It’s impossible to cover everything and people tend to surprise us, but it’s important to get the basics defined. Even the act of doing this sets the tone for the relationship going forward.

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