Partnering With Your Spouse
As you might suspect, this can be a tough subject. Regardless of the relationship of the partners, successful partnerships are difficult to maintain. I can not count the number of partnership separations that I have witnessed that have come about as a result of other problems unrelated to the actual day-to-day running of the business. However, there are at least as many successful partnerships as there are unsuccessful ones. The key is to know how to make your partnership a success.
There are many reasons that we choose to be in partnerships; shared dreams, financial agreements, the need for support, etc. All of the reasons you are planning to form a partnership need to be talked about with your partner before you actually finalize any agreement. Many business partnerships begin with a handshake and progress on from there just fine. However, this is the exception, not the rule. So, to help you with this transition and build your chances of success, here are some basic guidelines you should consider as you form your new partnership.
- First, put in writing what you are agreeing to, including everything you can think of, and how you will make decisions and/or use mediation if you cannot come to consensus.
- Second, write down what each partner's financial commitment will be initially, and what the expectations are for hours of work, and ongoing financial infusion, if needed.
- Third, write down how you will dissolve the partnership, or sell an interest, when (not if) one of the partners wants out of the business.
- Fourth, write down succession plans for the unexpected event of a partner's death.
By putting all of this in writing and having all partners agree to it, you will have something concrete to refer to if there is any type of disagreement or conflict in the future. This is especially critical for family member partners that have more at stake than just the business, especially if you want to preserve your marriage or friendship after the business decisions have been made. Remember, everyone's life goes through changes, and any kind of change affects our personal lives as well as our professional lives. It is much better to plan for these changes rather than be taken by surprise by them. Some states require a partnership to file its agreement. Make sure your partnership agreement has all of the necessary sections completed regardless of whether or not you are actually required to file.
Successful partnerships are based on each partner's ability to listen to the other partner(s), be flexible and truly advocate for the decision that is best for the business. Any partner can have veto power, as long as there is continued work to develop another option. A third party, business counselor, or mediator can be utilized when you are facing what seems to be irreconcilable differences. When the responsibilities are clearly outlined, expectations are also clear and less likely to be the cause of hostilities or resentment. Changes in responsibilities should be agreed upon by all partners for the same reason. Personal emergencies should have the highest priority since you can not work when you are distracted.
Having been in a successful partnership for 16 years, I cannot say enough about how important it is to really listen when the other partner has a concern or issue. Other than when we are in high stress deadline months, my partner and I take breaks (on a regular basis) to listen to each other whenever needed. And if one of us knows about a change that is upcoming, we let the other one know as soon as possible. We have found it helpful to separate our personal and professional lives as well: we do not live together and we very rarely socialize outside of the office even though we have some shared friends. Although we get along very well, we try not to push the limits of our ability to spend time together.
If you are thinking about partnering with your spouse, it is important to remember that this will effectively put you with them all of the time. If you do not have a great listening relationship before you start your business, you may run into conflict rather quickly. In fact, running a new business is like having a baby. Any conflicts or incompatibilities that existed before the main event will only increase as a result of the added demands that each of you will be forced to deal with. So, one thing you will want to do is address any concerns you may have before you start your business. Another thing you can do is make a clear delineation of responsibilities. This helps to reduce conflict by separating decision making responsibilities. Below is a list of questions you will want to consider as you divide up your family and business responsibilities.
- Who handles the emergency child care situations?
- Who handles the emergency business situations (when you are on vacation together)?
- Who handles the house repair problems?
- Does either of you have seniority at work, at home?
- Can you spend all day working together, and still have quality personal time at home?
- What happens if one of you wants to quit the business, or sell out?
- Can you trust and agree to the changes that the other spouse sees as necessary for the business to survive?
- Are you willing to risk the marriage in order to have the business relationship?
Similar questions can be asked about partnerships with friends and/or relatives. It is important to realize that it is difficult to keep your business and personal relationships separate. However, you can agree to discuss work at work, and reserve personal conversations for after hours.
As the following story illustrates, putting agreements in writing (especially regarding dissolutions) is critical. Two friends started a business. Since they had known each other for a long time and were such good friends, they did not think they needed a written partnership agreement. Then they became sisters-in-law. One day they had a falling out over work schedules. What started out as a basic disagreement grew into a heated battle. Finally, the two friends dissolved their partnership. Since they were now related, the business separation affected every family member in the small town they lived in. Even after two years, they had still not resolved their differences.
Unresolved conflict can undermine our best efforts, and affect us in ways we would never guess. The closer you are to your business partner, the more you have at risk. Put your agreement in writing, and get help resolving differences at the beginning. Do not wait until a conflict has caused irrevocable damage.
