Business Partnership Advisor
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Chris Reich, Business Luminary
8 Tips for Better Communication in Your Business Partnership
Chris, every time I talk with my business partner we get in an argument. What can we do?
“All happy business partnerships are alike; each unhappy business partnership is unhappy in its own way.” Chris Reich blatantly plagiarizing Leo Tolstoy. ©2020
8 Business Partnership Communication Tips
I help business partners work out their differences. Even though the businesses are different, many of the issues in tense partnerships are similar. Some partners manage to work things out with a little guidance. Some partnerships get so volatile that partners can no longer discuss simple business decisions. Here are 8 tips to help with business partnership communication if things are already getting tense. Each of the examples are taken from REAL cases.
1. Keep Things in Proportion
I almost laugh sometimes when I hear about the big issues between business partners. I don’t laugh, of course, because it’s my job to take the problems seriously and help partners work things out. Often though, I will be told about a partner who is reckless with the company’s money. “Tell me about this,” I’ll ask. Then comes the bombshell, “yesterday he bought lunch for all the employees without asking me.”
Big spender? Turns out that there was an all-day meeting yesterday with all 3 employees and the “fiscally reckless” partner spent $22 for a pizza and soft drinks. Naturally, the partners had a big argument about this. “It has to stop!” demanded the partner.
Point? Don’t go ballistic over a small thing even if those things happen pretty often. If your partner buys lunch every day, it might be worth discussing. One guy told me that his partner buys sandwiches every month for the staff meeting. That’s right, every month! There are 4 people on that staff. Come on.
2. Don’t Be Nasty
Is it necessary to be insulting with every interaction? No.
I had two partners on the phone the other day and we started talking about sales. It helps me understand the stress level if I have a picture of how the business is doing. Immediately, one of the partners said, “he never does anything but cost us money. I make all the sales. He is pretty useless to me.” Useless? Turns out that the useless partner was doing most of the daily grunt work but burned out after being constantly subjected to criticism. He just quit trying.
In another case, a partner wanted to discuss business strategy with his partner but that invitation lead to a major blowout. How would you react to “we need to figure out our next steps since you’ve totally f—-d up the business lately.” Sounds like that would have been a pleasant meeting, right?
Point? It’s business. There is no need to be nasty. And don’t ever tell me “I am just being honest because that’s the kind of person I am.” That line always comes from nasty people. Rather than add to the tension, try asking for help. “Could you handle the books if I handle the sales?” Or, “What can we do to increase sales?”
3. Don’t Speak for Your Partner
At a meeting recently we were discussing ways of handling an employee issue. One partner said, “I like this idea but Jim is going to say that it will never work. That’s why nothing ever gets fixed when there is a problem.”
Wow, Jim was right there. Don’t speak for your partner. It’s rude and often you’ll be wrong in what you’ve assumed. Also, many times people frame things in a way that leads to the outcome they expect. In a meeting a partner suggested that all employees get a pay rise. Then he added, “I know Bob is just going to say ‘no’ so why bother?” I asked them both about the last time they conducted a wage survey to see if they were paying too much or too little. ‘Bob’ immediately said that if they were paying below average that they should increase employee compensation. Sure, it helps when it comes from an outside party like me, but I didn’t assume the idea would be shot down.
Point? Yeah, don’t ever speak for your partner. And, if the results are always predictable, try rephrasing things or taking a more measured approach. By the way, Bob’s company gave everyone a 5% raise at Bob’s suggestion after we reviewed the results of the wage survey.
4. Don’t Presume You Know What Your Partner Thinks
This drives me nuts. People do it with me! “You probably think I just want to control everything, but he does tend to spend money on things we don’t need.” See how that puts me in a box? Before we can get to Bill’s spending, I have to deal with the control issues. This is a lot like #3 above but rather than speak for the partner, everything gets framed by what is presumed. “I never brought up firing Sally because you would never go for it.” To which came the reply, “are you kidding? Sally costs us a lot of money and she is nothing but trouble!”
Sally is now job hunting.
Point? When people work together they get to know each other’s thoughts but only to a limited extent. Talk. Don’t assume. When we assume, we generally assume the worse. Talk.
5. Remember That You Don’t Know Everything Going On in Your Partner’s Life
No matter how close business partners are, they don’t share everything with each other. I had a call with 2 partners who had an issue about missed work time. One business partner was “fed up” with the other. “He is coming in late all the time and often leaves early. I’m tired of doing all the work!” When I talked with the other partner, he told me that his child had been seriously ill for the past 2 months. “I don’t want John to know because my wife wants to keep this in the family. It’s going to be okay.”
I’ve worked with partners who were going through divorce, financial crises, dying parents, and a host of other big personal things. You never know everything that might be happening in someone’s life. No matter how close you think you are with your business partner, never assume you know everything happening in her life. I’ll always remember the client who told me about his stress after getting a serious medical diagnosis. He was afraid to tell his partner because they didn’t have a buy-sell agreement.
Point? Don’t assume that you know what your partner might be going through. Talk with your partner. Let him know that you are on the same team and that if he needs time off, you have his back. Those words can change everything.
6. Don’t Preach to Your Partner, Ask Questions
I see this happen when business slows down or a partner gets bored and wants excitement. A partner will start issuing orders and making demands ‘because they know better.’
“You need to get focused on making sales! Sales are everything! I am not going to be the only one around here keeping the doors open.”
You can see what’s wrong with that. This always sets off a war over who does more work at the business. Why not sit down and talk about what can be done to boost sales? The old rule comes in again: Questions are far more powerful than demands.
Point? Nobody likes being ordered around, especially by someone who is supposed to be an equal partner. The first rule of interaction with all people should be to show respect. Don’t you prefer to be treated with respect?
7. Focus on Business, Not Personality Traits or Behavior
If you want a conversation with your business partner to go badly, try this. “Marge, you are terrible with people. Nobody likes dealing with you.” There’s an opener! This comment was made in a meeting I had with 3 women who started a web design company. Two of the former best friends were now at each other’s throats. The other partner felt stuck in the middle. That statement came out at our first meeting. When we calmed down and got into specifics, the background story cleared up that comment. The company had a client who hired them to create a large, expensive website. They did the work and the site was great. The ‘client’ owed a balance of $7,500 and was 6 months late in paying. Marge was calling about collecting the money. The client reached out to another partner to complain about “Marge calling all the time” and “being pushy.” Doh!
In another case, a partner said, “you can’t manage people well. You just think money is the answer to everything. You’re too soft. You don’t understand that we can’t just keep paying more just because someone complains to you.” Those comments are all about the managing partner’s personality and not about the situation. Get the discussion focused on business by changing the comment to “should we talk about what we are paying Sally? What do you think? Are we paying her enough?”
Point? Take your comments off of your partner and put them on business, not personal terms.
8. It’s Not About Winning, It’s About What’s Best for the Business
This is a great tip. It will benefit everyone who pays attention to it. You only have to set aside your ego.
Consider this frequently seen arrangement. One partner is the managing partner in a business. This partner, Jill, works full-time in the enterprise and is responsible for the on-going success. The other partner, Jim, put up the money, $100,000, to start the business and works about 6 hours a week.
Jim likes to think of himself as a true business genius. He’s made some great moves that benefited the business over the years. Jill feels like she should be getting more money because she is doing “all the work” to keep the business going. The argument gets bad enough to call a mediator. At the first meeting, Jim says, “she wants more money, but this business wouldn’t even exist without me.” True. Then Jill says, “we started 15 years ago, Jim. Now I do all the work, but we are still getting equal money. I think I should get a little more for doing all the work.” Boom! Jim blows up.
This is a discussion about money, but it’s evolved into an argument over contribution. I stopped the meeting and recommended that we meet again after both parties cooled off. In a private conversation with Jim, I asked him if he wanted to win the argument or benefit the business while strengthening the partnership. Does it matter if you agree that she does all the work? Does it matter if you agree that while you started the business, she has kept it running profitably for 15 years?
At the next meeting, Jim opened with a statement of appreciation for Jill’s work. He told her that the business would not have survived the 2008 economic disaster without her at the helm.
Did that lead to Jill asking for a huge raise? No. Instead of a big raise so she would be making a lot more than Jim, Jill proposed a bonus structure that would give her a lump sum equal to about 10% of her salary if she made the company substantially more money year over year. Upon reflection, Jim realized what a great deal that was! Jill increases profits which they share as equal partners and she gets more money. Everybody was happy, the company had its best year ever, the partnership is strong.
Point? Pay close attention when your partner expresses dissatisfaction. By providing support, you might help prevent partner burnout. Let go of things that don’t matter. There is no value in arguing a symbolic point when the real issue can be easily fixed. The best answer to “I work a lot harder than you” is to say, “I appreciate what you do. If there is something I can do to help you, let’s talk about it.”
Congratulations! You’ve read nearly 2,000 words about partnership communication! That shows you care. If you have problems with communication in your business partnership, call me. I help partners fix their partnerships. Don’t wait until every conversation leads to an argument.
Make this your most successful year.
Chris Reich, Business Partnership Mediator
“Some partnerships get so volatile that partners can no longer discuss even simple business decisions.”
We’ll talk (briefly!) about why you need a Partnership Agreement and then we will cover the most important pieces that should be in every Partnership Agreement.
I help business partners work out their differences. Even though the businesses are different, many of the issues in tense partnerships are the same.
We must always balance being too negative or too positive and make certain we are being realistic. Furthermore, we need to be careful that we convey that reality to others.
I am a business partnership mediator. Every day partners come to me to help settle disputes or to reduce tension. I always recommend a Partnership Agreement.