- March 29, 2013
- Posted by: admin
- Category: blog, Career Coaching, daily lfe, Technology, Uncategorized
In todays challenging business climate, partnerships, collaboration and normal business relationships can be the most important aspect of your success. One wrong decision can destroy years of hard work and most importantly your reputation. On the other hand, if you make the right decision, you will gain professional and even personal stability in your business beyond measure. That is why every leader should have a season of “vetting” your team. This is a time when you sit down and evaluate where you partners are in the growth of the business and which ones bring value versus consistent failures.
I have been in business for almost 20 years. Half of that time on my own as an entrepreneur and I can tell you that this is a very difficult task. That is why many businesses fail, and I have had my fair share of failures. It doesn’t take much to build a business based on great partnerships. Some what like a marriage. If you are equally yoked and possess the same drive, ethics and commitment to success, then you may have a chance of long lasting success. However, just like a marriage, you marry the wrong person and you can find yourself in business divorce court, settling up all the equity and walking away bitter and exhausted with litigation. I have been there with previous business partners and trust me, it wasn’t pretty. Everyone looses!
In my experience in working with partners (some good and some bad), I have learned that sometimes you just can’t work alone if you want to have long term success. Your business model will dictate if you need a partner or not. In that case you need a partner, you have to make sure your vetting process is solid enough to weed out those who do not share your vision, values and goals. No amount of education or previous business experience can prepare you for that one bad apple that slips through the cracks and sabotages your dreams. Believe me, you will be surprised of what your “partners” will say to prevent your business from getting too far ahead of them. Here are some unfortunate incidents I have experienced with bad business partners:
- One partner became prideful because they believed there wasn’t enough praise to go around. It became a power struggle and the employees were in the middle.
- Another was money. Constantly asking for more money in the deals. It became a consistent ritual of talking about how much money they needed as the deals became bigger.
- The most damaging one was a “divide and concur” partner. This one saw opportunities to divide the business group to improve his financial position within the partnership. They would weed out lesser partners while increasing their position in the business. They even went as far as sabotaging clients, creating ghost subcontractors and taking payments from the company under a false business name. What a mess that turned out to be? Of course the group eventually caught on because of the patterns of failures left behind, but it actually cost me a business venture and millions of dollars in revenue. I’m sure you get the picture.
So, if your business requires a collaboration or some type of professional partnership, make sure you take time to “Vet” your team members before, during and throughout the entire engagement. Never relax. If you have true partners, each one will not mind accountability and that is what builds a multi million dollar venture.
I have established several “critical” lessons learned that I will share with you to hopefully help prevent your business from a disastrous fait that could ultimately cost your your dreams.
- Make sure you do some background checks on your new collaborator or partner. Don’t just assume good things because you heard that he or she was successful. Vet their success and expertise.
- Make sure your partners can actually execute. Take some time to find out if your partner can do what they say they can do. Call one of their previous clients and ask them personally to rate their ability to deliver a solution or service.
- Evaluate their ability to communicate. Always evaluate their ability to communicate with you, your team and the client. If you are engaged in a project, follow up and see what type of response your clients have when asking about the partners ability to communicate. It is not wrong for the CEO, Chairman or owner of the company to touch base with a valued customer to make sure the team is providing a great service. It is within your right to do so and exercise that right to make sure your collaboration or partner is on your team.
- Spend some time with them before you begin your business venture. Find out what type of person he or she is. Check their website, go to dinner or meet in various places to get a feel for how they function in each place. Be ethical, but find unconventional places to meet like a park or somewhere with a lot of people. See how they react to being distracted and/or how focused they are during your conversation. Ask about their personal background. If they are married, children etc. You want to know as much about their personal background as possible. I learned one thing, “a persons personal ethics are not too different from their professional ethics”. Meaning a person who will pirate music will steal your client with ease, or a person who cheats on their wife will cheat you out of some money. Trust your instincts.
- Get everything negotiated in writing. Don’t be afraid to introduce your attorney to the partnerships. If you don’t have one, then get one. Paperwork is the knight in shinning armor. When things go wrong, contracts can keep them from getting worst. Never, never, never do business on a hand shake. No matter how much you trust a partner, always cover yourself in paperwork. Partnerships can last forever and can go sour in seconds. Point and case, I had a long term partnership that went wrong in one day. Broke my heart to terminate the partnership but it had to be done. Where I failed is, I didn’t have all of my ducks in a row and it cost me a business venture worth hundreds of thousands of dollars. Never skip this section.
- Update, review and revise your paperwork as often as needed. If there are major changes in your business ventures, adjust your contracts accordingly. Never let contracts go over two years without some update.
- Protect your valued clients & relationships from potential bad apples. Include necessary clauses in your contracts that will protect your business venture from a pirate. There are a lot of great sales people out there that can convince you of equal partnerships and collaborations, but if it is your company and your brand, protect it. Keep in mind that every client created under your brand is yours. Fight for them and make sure you are clear of how the partnership works.
- If you are in an LLC or joint venture, don’t get started until everyone involved is on the same page. Get a clear understanding of who does what, how everyone gets paid and document the agreed terms in your Operating Agreement and the policies and procedures in your bylaws. If you are becoming business partners, act like business professionals.
- Don’t be naive or look for a partner when you are in need. Find your partners before you have ventures or opportunities. My best business ventures were when I met with future partners for months before we began to do business. This gave me enough time to meet, chat, vet and get a better feeling on who they really are. If you are desperate, good con artist can sense your desperation and will take advantage of your situation. No good business venture will come from that engagement. You will loose every time.
- Finally, look for partnerships and collaborations that will help you get better as a professional. Most people believe if you surround yourself with mentors and bright people, you have a better chance of success. I can actually say that is true. When you are surrounded by people that can help you advance your initiatives, everyone wins. Be humble in your approach but don’t be a fool. Keep one eye open while you are always making sure things are going smooth.
Your business success depends upon your due diligence. It is your fiduciary responsibility as a leader to make sure your business decisions are good. You may have to give up some authority or even share some revenues but it in the long run, it is your right to check, double check and check again throughout the process. Don’t get caught off guard. The day you relax in your business relationships could be the day you find yourself sliding down a slope of no return. However, if you follow these steps and surround yourself with the right people, you can see your dreams come true.
“Be a leader and unleash your potential today” www.scottacoulter.com Scott A. Coulter, CSS