Wednesday, April 9, 2014

Leadership In A Partnership of Equals: What Helped Others Build Successfully














A business partnership is usually hatched in a state of inspired optimism when two or more seemingly like-minded individuals come together with an idea to create a product or service and develop it into a business, says Stacy Perman of Bloomberg Businessweek (2008).  Such was the case for Larry Page and Sergey Brin who met [while] working on their doctorates in computer science at Stanford University in 1995. Together, they created a proprietary algorithm for a search engine, with the goal of organizing the vast amount of information available on the Internet (Businessweek, August, 2008).  In 1998, the pair dropped out of Stanford, changed their startup’s name to Google, set up shop in a friend's garage, and raised about $1 million in capital from friends, family, and other investors.

Two Schools of Thought

Business partnership is an unincorporated organization formed by entities or persons who join to carry on a trade or business (Wheeler and Shumofsky, 2007).  Its main purpose is to enhance collaborative advantage in the increasingly challenging market environment, and to produce long-term mutual beneļ¬ts for all partners (Wagner et al. 2002; Carr and Smeltzer, 1999). Partnerships offer more freedom for business owners with shared business responsibilities for a common goal (Kanmogne and Eskridge, 2013, p. 944).
Formalizing such a partnership agreement early has been the advice of some whose own experiences with partnership inform their view.  Steve Hindy and Tom Potter, who founded Brooklyn Brewery in 1987, feel it is important to define a partnership from the outset and that formalizing it on paper with a set of parameters that could be referred to when questions or troubles arise (Hindy and Potter, 2006).  Countering this view is Gary Dushnitsky, a professor of management at the Wharton School, [who] doesn't favor formalizing a partnership agreement too early.  According to Dushnitsky, the early stage of the business relationship is the time to determine what each person can bring to the partnership in terms of capital, contacts, level of engagement, as well as to see how each views their commitment to the venture, their vision, and the time line they see for its development (Businessweek, August, 2008).
From my personal observations and learning on leadership in a partnership of equals, I conclude there are four key considerations that all partnerships must acknowledge:
  1. For individuals who agree they bring different but complimentary vision, values and commitment to accomplish a common goal, partnership can be a viable organizational strategy.
  2. Those differences must be defined and each individual must agree to specific operational parameters, otherwise disputes could more easily result in severing a partnership agreement.
  3. Most important, in my view, all partners must understand that regular and continuous communication on all issues that can affect the partnership, whether personal or professional, must be initiated and maintained. 
  4. Finally, unless previous organizational hierarchy has been established, time will likely provide strategic insight into who might serve best as the partnership’s administrative, operational and technical leaders.  Effective leadership communication—throughout all parts of the partnership—demands a clearly defined and agreed to communicative process which can and should emerge, correspondingly, from this time-honored approach.

Can also be read at blog.mylpi.org  (effective Tuesday, April 8, 2014)

References

Hindy, Steve, and. Potter, Tom. (2006). Beer School: Bottling Success at the Brooklyn Brewery. Wiley, John & Sons, Inc.).
Kanmogne, M., & Eskridge, K. (2013). Identifying some major determinants of entrepreneurial partnership, using a confounded factorial conjoint choice experiment. Quality & Quantity, 47(2), 943-960.
Perman, Stacy. (2008). “Contemplating A Business Partnership,” Bloomberg Businessweek. Retrieved April 5, 2014 at:


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