8 Things a Good Business Partnership Mediator Can Do for You

A Business Partnership Mediator Can Save Your Partnership

What Can a Good Business Partnership Mediator Do for Your Business?

In Partnerships, the problems that come up are as varied as individuals. Though mediators see many of the same themes, each situation is unique and requires skillful listening. A good mediator is a great listener. Not surprising, people calm down when they feel that they are being heard.

A Good Business Partnership Mediator can do more than help decide items of conflict. I offer services that help the business as well as the partnership. When the business starts doing better, the tension between partners goes down. Once the temperature is lowered, talks are more fruitful and items causing tension are resolved.

Don’t think of Partnership Mediation as a controlled fight with the mediator as a referee. Partnership Mediation is a process that discovers the issues, guides those issues to resolution, and helps the partners focus on the business rather than emotions.

Partnership Mediation has a lot of benefits. Let’s look at the most critical things a mediator can do for your business.

#1  Outside Perspective Without Being Judgmental

Having a neutral third party listen to your partnership points of tension and provide you with an outside perspective is usually a start toward the reduction in stress. Have you asked yourself, “Am I unreasonable?” You know what your friends and family will say. But are you sure?

Sometimes people will tell me that they want to address something before it gets serious and after talking I have to answer that it already is serious.

Getting an outside perspective is very valuable as long as it comes without judgment. If you go to a dentist with a toothache, you don’t need a lecture on flossing.

#2  A Mediator Can Open Free Communication Between Partners

Again, there is that misconception that a mediator acts as a referee. That’s not what I do. I help guide communication without letting things get too emotional so we can talk about the things that caused the tension. I always start by having several private conversations with the partners so that everyone has a chance to speak freely. Then we have video conferences and talk through the problems. The mediator’s role is to offer possible solutions to keep the issue from causing further harm to the relationship.

For example, if there is a dispute over money, we can talk it through and draft an agreement about taking draws from the business. If someone feels like they have to keep putting money into a business while the other partner is not, we can book some expense into the books as items that need to be reimbursed. Knowing that some things will get paid back often helps with money tension in a partnership.

The big contribution is to get the communication going. A good mediator can start conversations and keep things from getting too emotional.

#3  Help Draft a Partnership Agreement

Most business partnerships that develop problems do not have a Partnership Agreement. A good mediator will talk you through the various items that need to be in your Partnership Agreement and help you decide how you and your partner(s) would like to handle each. Rather than simply handing you a boilerplate document with fill in the blanks, a good mediator can explain what you want to include and what problem each clause prevents. The final definition is up to you.

For example, have you thought about what you would do if your partner was injured and became disabled? They own half of the business but can no longer contribute. Do you pay a salary?

I guide my clients through various scenarios and help them come up with how they want each possibility handled. That outline becomes an understanding that we can draft and sign. Then your business attorney can draft a formal document using your clauses. This makes sure everything is covered and you save a lot of money.

#4  Work Out Money Problems Between Business Partners

Fixing money problems between partners is a common role of the business mediator. Though money creeps into communication problems and often arises out of the lack of a Partnership Agreement, sometimes there is only one big issue, and it’s centered on money.

A business mediator should listen to all sides, guide calm discussions about money, and offer solutions to fixing the problems while preventing them from popping up again. 

#5  Help Establish Agreements Between Partners

A good mediator will not just act as the company psychologist. When issues are talked through to everyone’s satisfaction, there needs to be formal resolution in the form of written agreements. Relax, it’s not complicated.

We’re not talking about marriage counseling. Business revolves around contracts. If taking time off is a point of contention between business partners, having a policy will keep the problem from coming back.

The process starts with having open conversations about the issue, reaching an agreement about what to do going forward and drafting a policy that becomes part of the Partnership Agreement. In the case above about taking time off, it could be as simple as, “We agree, effective immediately, that partners will work every other weekend. Further, we agree that partners may choose 4 days off in addition to every other weekend as their chosen off days. The days off will be added to the calendar at least 2 weeks in advance.”  Informal, clear to the partners who draft it, binding when signed.

A mediator who can help draft agreements between partners will help you with solutions that last.

#6  Mediation Should Improve Your Business

Sometimes business problems turn into personal problems. When partners are feeling the stress of the business, they might begin to pick at each other.

When business problems are identified and fixed, partners get back in focus and turn their attention to the daily operations of the enterprise. For example, one of my clients had a very low-performing employee in the business. The partners didn’t have much experience with firing people and they let a bad problem become worse.

We spent an hour talking about how to handle the dud employee. The two partners who were in disagreement over how to manage the business focused on getting rid of the bad employee and finding a great replacement. In working together on a problem, they got back to where they were when they decided to be partners. The business started doing a lot better after that bad employee was removed.

#7  Stay with You Beyond the Satisfaction of a Single Disagreement

Most mediators will step in, deal with a disagreement, and leave. In my opinion, a good mediator does the other things I’ve listed here and is there for followup as needed. Once the big issues are resolved, clients often contact me about little things that come up. I always welcome the calls and usually do not charge for quick consults.

Once partners have been through conflict, they want to avoid having things heat up again. They may give me a call with the old question, “am I being unreasonable?”  Sometimes I’ll recommend that we jump on a quick video conference and talk about it. And sometimes I’ll say, “Yes. This isn’t a big deal. Let it go.”

Having someone who can work with all the partners is a great resource to help prevent tension in the partnership.

#8  If It’s Time To Go, A Good Mediator Can Guide a Peaceful Partnership Separation

There are cases where it’s best if the partners separate. Unless there is access to a lot of money, buyouts are usually complicated and tense. If one partner has lots of money and can say, “here’s a million dollars, let’s separate,” it’s easy. But that never happens. How can you do a buyout if there is no money? That will involve some creativity but remember that whatever is not spent in court or on lawyers is available for settling a separation. A good mediator works to conserve resources while working out the best way to separate the parties.

There is no need for the dissolution of a business partnership to be a hostile, acrimonious process.

If you have problems in your business partnership, keep these 8 things in mind. And always remember that the sooner you act, the greater the chances a peaceful solution will be reached.

Chris Reich, Business Mediator (chris@teachu.com)

“A good business partnership mediator could save your business. Work with someone who cares about the survival of the goose laying your golden eggs.”