Is your existing business partner a lot of hard work?

by Dr Vince Giuca

Unhealthy disagreements and conflict among business partners can be devastating for any business, especially where managers and staff are aware of what is happening. When conflict becomes ingrained, it is difficult to hide it from the rest of the workforce, and this is the time when action to address the underlying problems can no longer be delayed.

You have already invested considerable time, effort and resources into the business, and it is very difficult to walk away. You think of the embarrassment and sense of failure, the financial losses, potential legal costs and action, and what to do next to make a living. Most people respond by simply doing nothing and letting the situation deteriorate even further (called the status quo bias). Invariably, this scenario evokes emotional responses that distort the picture and prevent best case solutions from emerging.

The fundamental question that needs be addressed is whether you are still motivated to stay in the business. From the response to this question, other questions and responses will follow. The partnership was formed because of mutually perceived benefits. What has happened with that view of the world? If your world view has changed radically and you no longer want to remain in the business, options will be available for you to explore, such as selling your share of the business to your business partner or an employee.

However, if a mutually agreeable transition is not possible, the business may need to be sold, placed under administration or liquidated. If it is to be sold to a third party, the process could require more effort by each partner in order to make the business saleable and this could take a lengthy period of time. A quick sale may not be in the financial interests of the respective partners. Therefore, co-operation among the partners is required to present the business in the best possible light for prospective buyers.

On the other hand, if you wish to remain in the business then you need to ask whether there is a possibility that the relationship with your business parter can be salvaged. Has the situation deteriorated because of your partner’s poor communications and inappropriate expectations? What about your own communications efforts and expectations? There are likely to be a range other key issues that need to be discussed and resolved. Anything that is likely to be a problem in the future needs to be put on the table and discussed in full. Acceptable solutions need to be reached and documented, and regularly reviewed.

Under either scenario, the services of a professional advisor, coach or mediator will help expedite the process and is more than likely to be the most cost effective path to take.

ABOUT THE AUTHOR

Vince Giuca is the Founder and Executive Director of Partners-in-Business Institute (PiBI), established to assist executives, managers and entrepreneurs with human resource management, workplace conflict, team and organisational development, partnership relationships and business negotiations.

Vince completed his PhD on ‘The changing role of the entrepreneurial founder in emerging fast-growth firms’ in 2012.

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