The Seven C's: Partnership Danger Signs - The 4th C: Cumulative Money Problems



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A series of articles exploring the seven critical areas that can indicate a partnership is in trouble.

The 4th C: CUMULATIVE MONEY PROBLEMS

Conflicts over money are very high on the list of reasons that 70% of business partnerships fail. I'm not referring necessarily to lack of money. The damage to business partnerships stem from the fact that each of us have different attitudes about money and therefore handle it in different ways.

The most hopeful scenario is that differences have been discussed openly at the outset of the partnership and are continually a topic reviewed with level heads.

Most often that is not the case. Here is a sample list of the types of problems businesses run into around money where partners can have very opposing views:

  • financial risk taking

  • collections

  • investment of profits

  • family involvement on acquisitions

  • under-capitalization/ involving outside investors

  • perceived inequality in remuneration of each partner based on each one's view of each other's work and responsibility

  • hiring and salaries of employees

  • investments in outside experts to train, coach, market, etc.

The money issues in business that accumulate over the course of time are based on many factors, some personal, some internal to the business and some on outside forces beyond anyone's control.

Bill and Vincent were investing in a new business. Vincent was unemployed with limited funds, so at the outset Bill did the financing. There was growing tension between them because of this. Bill felt he had more right to make decisions. He also had a subtle way of belittling Vincent because of it. How could such interaction be a good basis for a new business?

They were wise enough to seek coaching, during which I helped Vincent spell out the behavior that was not obvious to Bill. Vincent on his own was too uncomfortable to communicate clearly how he was feeling. When it was out in the open in our coaching sessions they were able to make some changes so Vincent was able to contribute more in ways that made him feel respected. They also set some goals and deadlines for adjustments in the financial contributions.

Open communication in this scenario prevented problems from escalating into major conflict which could have ultimately ended the partnership.

Partnership agreements can go a long way to spell out how money decisions will be made. However, partnership agreements are not very efficient in predicting how personalities will react in various unforeseen situations and crises.

Protect your partnership as much as possible. Choose your partner wisely. Choose your business wisely. Engage a coach early in the process. Here are some of the ways it will pay a high return on your investment:

  • make sure partners are on the same page and well suited

  • discuss important issues unique to you for the partnership agreement

  • improve communication and as a result focus on the smooth functioning of the business instead of on personality issues

  • better and more efficient decision making and problem solving

  • greater commitment to the end result and less time wasted in disagreements and problems

  • more pleasant atmosphere carried over to employees, clients and vendors

  • devoted employees

  • better service resulting in increased bottom line

Do you have a challenge around your business partnership or any other type of partnership? Give me a call or send an email. I offer a complimentary coaching session so you can find out if it's the right vehicle for you to move to the next level in your business and relationships.



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Guest post written by Stuart Ngai, Director of Technology Solutions, VERAX

WhichWayHaving worked in software development in the engineering and financial sectors through several technology eras, one thing strikes me the most is how often top notch IT professionals just get burned out by the fast pace of technology advances. As an educator, development manager, and technology driver for many years, it has been my passion to help our IT staff to keep up in light of global competition. On the previous episode of the AlignIT Manager Tech Talk, I shared with the audience my advice on how IT managers can play an important role in their team’s training. I would like to summarize a few important aspects to keep in mind when it comes to planning and managing training for your staff.

Continued from last Monday. Read Part 1 >>

Enforce a checkpoint schedule

Now that you’ve worked out a set of goals with your staff. Who’s responsible to make sure things are on track? My experience tells me that it’s both of you: your staff needs to take ownership to keep up with skills and you, as their manager, need to be the measuring stick. And if you fail to plan, then you plan to fail. So it needs to be instilled as a routine in order to keep the momentum going. By measuring training progress on a periodic basis like once every 3 to 4 months , you’ll know whether your staff is progressing as expected or perhaps he or she is being overloaded. With such a feedback loop, you’ll be able to fine tune the training plan and keep things in focus.

Not one size fits all

Everyone’s different. Some of your IT staff might be more comfortable with structured classroom learning while others prefer to be given time and web resources so they can learn at their own pace. And one of the techniques we have done successfully at VERAX is to provide some of the technology savvy staff with resources and allocated time so that they can put together lunch and learn seminars for their peers. And there are many benefits for that: opportunity to showcase what they’ve learned, efficiency in cross training each other, a chance for the team to gel and discuss innovative ideas for your workplace, and virtually no loss of productivity at a minimal cost to the company. It’s been a win-win training mechanism that has been working well for us. So be creative in your approach to training.

Make use of web resources

With advances in webcasting and e-learning tools, many companies are no longer constrained to sending their staff on expensive offsite training. Virtual training along with virtual machine images would be a great way to learn. And there are tons of resources on the web for that purpose that you should look into (some free resources - Developer Connection, Channel 9)

Make it fun

Be aware of e-learning trends and listen to your staff for innovative and fun ideas to learn. As an example, one thing we have done is to provide tablets to loan to our staff along with e-book subscriptions so that they can read at their own pace anywhere anytime. Our staff love such innovative approaches to learning and they appreciate our willingness to invest in them. So not only did we generated excitement and high level of staff engagement, we know our staff will be able to learn throughout the year on their own pace instead of the standard one to two weeks training for most companies. So make it fun and engaging. After all, it’s a small investment that pays back many folds.

To finish off - You are not alone

Just remember that you are not an island on your own. The best way to avoid missteps is to learn from the lessons and best practices of other managers. And guess what? There are already great resources freely available for you, such as the AlignIT portal and LinkedIn group. They are great places where you can read and interact with other IT practitioners for advice.

Stuart Ngai

Stuart Ngai, Director of Technology Solutions at VERAX, is an IT professional with over 25 years of experience. As a development manager, lead enterprise architect, and a Senior Leadership Member, Stuart has led the delivery of many leading edge systems through several technology eras and guided many IT professionals in enriching and re-energizing their careers. With 7 years teaching software courses at Seneca College of Applied Sciences followed by another 7 years teaching software engineering courses for the Faculty of Applied Science and Engineering at the University of Toronto, personal development through perpetual training has been a theme in which Stuart helped many IT professionals to achieve and sustain their career growth. Stuart is a certified P. Eng. and PMP with a Masters degree in Engineering from McGill University and a management degree from McGill's School of Management. He has been with the software consulting firm VERAX Solutions Corporation in Toronto since 1993 focusing on building strong delivery teams and delivering results to their customers in the financial sector.



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