Ultimatums Kill the Chance of Reaching Agreement Between Partners
Whenever a partner makes an ultimatum when I’m working to bring people together, the damage is almost always irreparable. Issuing an ultimatum is a disrespect to me as a mediator and the other partner or partners involved. Line-in-the-sand demands take away any room for negotiation. Worse, ultimatums are very damaging in mediation because they signal that further discussion is a waste of time. Ultimatums suck the life out of whatever positive is left in the relationship. Generally, once an ultimatum is put on the table, talks collapse.
Most of the Time, The Damage is Permanent
A demand, rather than an open-ended point of discussion, says your partner, “it’s my way or else. Your feelings, concerns, and opinion doesn’t matter. I am more important than you.” Once out, it’s pretty hard to get the damage under control.
It’s not enough to temper the ultimatum. That only adds further insult. It’s like saying, “okay, I’ll grant a minor concession, but I still want my way.” Can you see how nasty it is to issue an ultimatum to your business partner? It’s never, ever an okay thing to do.
I have worked with partnerships with pretty serious problems and made great progress only to have an ultimatum put things back to square one. Frankly, I have a very hard time recommending someone stay in a partnership with someone who thinks it’s acceptable to demand their way—or else! If the level of respect has fallen that low, it’s probably best to move on from that partner.
If people are serious about working things out, all ultimatums must be dropped with NO conditions attached.
“If people are serious about working things out, all ultimatums must be dropped with NO conditions attached.” —Chris Reich, Business Partnership Mediator
Can The Partnership Be Salvaged?
Whether the partnership can be saved is up to the partners, but after an ultimatum the trust needs to be restored. Frankly, if the trust breaks down, the partners may be better off dissolving the partnership. I cannot recommend keeping a partnership together if one of the partners has a history of dominating the partnership.
A healthy partnership is never under the dominance of one of the partners.
If you’re in a partnership with someone who has put an ultimatum on the table, consider whether the demand is valid or if it is part of an on-going pattern. I have seen reasonable ultimatums. What constitutes a reasonable demand? I consider whether the demand benefits the business or the partner making the demand.
If a partner demands that employees take customer service seriously or they will be fired, that benefits the business despite being a poor way of handling the problem. A demand by a partner that the business hires a friend or relative is self-dealing and wholly inappropriate. I worked with troubled partnership where one partner insisted on his spouse being retained as the bookkeeper. It’s never a good idea for one of the partners wives keeping the books. That eventually becomes a source of friction.
Finally, if a demand is withdrawn without conditions, perhaps accompanied with an apology, the partnership might be salvageable.
Before you make an ultimatum, consider how much is being put at risk.
Chris Reich, Business Partnership Mediation
“Before you make an ultimatum, consider how much is being put at risk.”
Somebody puts up money with someone who agrees to contribute labor as their contribution to an equal Partnership. Once things are set up, and a lot of money is spent, the other Partner fails to perform, and the troubles begin. I get 2-3 calls like this every week.
Partners take advantage of partners every day and they get away with it. It is the most painful call I get. It sounds like this, “I put all the money I had into starting our business. My partner had bad credit and no money, but he promised to do all the work to get the business going.
While it seems like it should be very easy to get out of an LLC, it can be complicated. Even if the business is very small, there are considerations beyond getting your money back. In this post, I’ll try to hit the important points of getting out of an LLC Partnership. These same items apply if you want to remove a member from your LLC too.