14 Signs You Have a Paper Partnership

Partnerships have become so important to business growth and success that some organizations have started to collect partners like they are some sort of prize. The problem is that we are often solidifying potential partnerships into written agreements before meaningful relationships have had time to sprout and mature.

Just because you believe a certain person or company could be beneficial to your cause, doesn’t mean you are ready to partner or do business together.  Even knowing someone really well, doesn’t necessarily make them an ideal or strategic choice; remember that old cautionary proverb, “you should never do business with family”.

Even if you’ve developed a great relationship before inking it, the words on the paper won’t be enough to keep the relationship alive over time.  We call these Paper Partnerships; a partnership on paper (written contract or agreement) but not in practice.

Paper partnerships can happen for several reasons:

• formalizing it too quickly;
• changing and competing priorities;
• personality clashes;
• too many assumptions early on;
• partners were not transparent about their needs or intentions.

Powerful partnerships require both strong relationships and structure to succeed.

The pressure to partner

In the world of research and development, partnerships among researchers, decision makers, and policy-makers have become mandatory in order to receive funding (e.g., the World’s Most Innovative Research Institutions, and Canada’s SSHRC November 2016 call for proposals).

Funders, sponsors and supporters (e.g., government, private donors, corporations) of foundations, charities and non-profit organizations are also assessing the return on their investments by understanding how their recipients are collaborating with other interest groups, and leveraging relationships to stretch the impact of their funds and support (e.g., Bell Let’s Talk initiative; Grand Challenges Canada).

Growing trends in the Fortune companies also show an increase in alliances as a strategy to gain competitive advantage and increase returns for shareholders. “In today’s hyper-competitive environment, companies must collaborate on innovative products and services, combining complementary expertise to fill individual gaps [Fortune].”  The PwC’s Health Research Institute Top Issues report revealed that 40% of Fortune 50 companies pursued new healthcare partnerships in 2014.  2016 has been dubbed the “Year of Merger Mania” where CEO’s report expectations of continued high profile M&A’s to strengthen technology and people.  The top CEO’s of the future will be doing a better job of anticipating the needs of customers and other stakeholders.

Not only are leaders under pressure to partner, they are under pressure to partner faster.  When faced with a prospective partnership, leaders want to make the best decision, faster, with fewer resources and better long term results.  They don’t want to miss opportunities or be beat by a competitor.  This can lead to paper partnerships piling up all over the place.

Identifying a paper partnership

There are many signs that help you understand and measure the health or vitality of your partnership.  Here are 14 signs that your partnership might require some added relationship investment and re-direction.

How do you know if you have a paper or purposeful partnership? 

1. You know the terms of the agreement better than the names of the partners
2. You assume the agreement will resolve arguments more than conversations
3. The relationship feels transactional
4. Partners hesitate in offering their best ideas
5. Partners won’t go above and beyond what’s written on paper
6. Partners don’t trust each other
7. Partners use the agreement to usurp decision making efforts
8. You focus on paper instead of people
9. You’d rather email than talk in person or by phone
10. You don’t think your partner has your best interest at heart
11. You worry about the true intentions (hidden agenda) of your partners
12. You wish the relationship would end
13. Without the agreement, there would be no need or desire to communicate
14. Without the agreement there would be no partnership

The key to transforming a paper partnership into something purposeful is to discover the root cause of these symptoms.

Contracts don’t always mean success

Depending on the size or significance of a partnership, legal advisors can become involved; at times affecting the initial chemistry developed among prospective partners.  The focus can shift from the desired results and purpose of the partnership (which is what draws partners together), to making sure that partners are protected from one another (which can lead to division and erosion of trust).  These pressures create ripe conditions for paper partnerships.

When formalizing your partnerships, consider two essential questions:

1. Are the terms of agreement equally in the best interest of all partners?
2. If you were your partner, would you be willing to sign the agreement terms you are proposing?

Contracts, written agreements and legal documents can help you clarify many aspects of your partnerships including:

• roles and responsibilities,
• accountabilities and authorities,
• decision-making process and criteria,
• timelines, expectations and costs,
• how success will be measured,
• guidelines for conflict resolution, and
• terms for dissolving the relationship.

Contracts can provide clarity, but they cannot guarantee success. They can outline the tangible or overt aspects of partnership, but often fail to capture the intangible and covert nature of human relationships.  What is often lacking in a contract is the relationship equity required to animate the contract continuously throughout the partnership and make it successful longer-term. This is why the process you use to develop an agreement is as important as the agreement itself.

Divorce before marriage

You can learn a lot about a prospective partner through the contracting experience.  It’s just like dating – you’re learning to trust, respect and rely on one another.  You’re testing the fit, chemistry, and alignment of priorities.  You also get the opportunity to practice disagreeing on small (and sometimes larger) issues, before you are contractually bound.

This is why we’ve made Divorce before Marriage one of our core VBP Principles.  It’s easier to talk about a respectful way to break up, to maintain your reputation and relationship, before you are too emotionally involved or upset.  Contracts don’t talk, people do.  When challenges arise in a partnership, it will be the quality of the discussion (not the clarity of the contract) that will help partners resolve differences and make better decisions.

Next time you are developing a partnership, take time during the relationship phase to develop the rapport, trust and respect needed to take a partnership to the finish line.  Put purpose before people, and people before paper during the contracting phase, and your partnerships will have a better chance of being purposeful and successful.