I have been working with two companies exploring a strategic partnership. While the intended outcome is that the two companies merge, first we are examining if the individuals involved–all with strong entrepreneurial spirits–can work together under the same roof. In this scenario, both companies view the partnership and potential merger as a win-win. However, before they move forward, I am working with them to answer these 5 key questions to make sure the partnership has a solid basis for success:

  • Can we work well together?
  • Are our values aligned?
  • Do we have a shared vision for the future?
  • If we decide to partner, what agreements need to be in place to support our individual success and how will we measure the partnership’s success?
  • If we decide to move forward, what will the transition plan be?

Can we work well together?

This question seeks to understand each individual’s personality, ego-strength, emotional intelligence, adaptability and willingness to engage in self-observation and self-inquiry. In this instance, we used two personality assessment tools, DISC and Emotional Intelligence Insights, to begin the conversation. The future partners learned that they had many similarities and that the differences were not deal-breakers. One larger question loomed: was each willing and able to practice self-management and take responsibility for his actions? It is one thing to say “yes,” but it is another to get feedback from others that supports or negates each partner’s perception of how they practice these skills. All parties agreed to my interviewing selected individuals from each organization for input on this competency. A partnership will not survive without individuals who take responsibility for their actions.

Are our values aligned?

We looked at each company’s values statements and had each individually identify their top 10 values so that, if there were significant differences, they would know upfront, be able to discuss the differences ahead of time, and decide if these would impact the success of the partnership. In this case, one company valued greater risk tolerance than the other, and the other company valued transparent communication. After talking through each, the parties came to agreement that both values were acceptable, as newly defined.

Do we have a shared vision for the future?

The company that would be merging into the other had a host of questions about the other CEO’s intentions and vision for the future of the combined company. We held a one-day meeting to explore both companies’ visions and work to gain agreement on a shared vision.

In this exercise, often parties come together with ideas of the direction they want the partnership to go, and it is important to watch to see how and if the individuals can collaborate on and inspire in each other a shared vision. Often times, they are hindered by not knowing each other well enough and uncertainty about how the partnership will work out. My job as facilitator is to hold the tension between what is known and unknown and help the parties build trust in each other’s intention to work collaboratively and effectively toward a shared future together.

If we decide to partner, what agreements need to be in place to support our success and how will we measure the partnership’s success?

When I talk about agreements here, I am talking not about legal or contractual agreements but about agreements that are made for how the parties will work together on a day-to-day basis. Without these agreements, the level of anxiety that exists – acknowledged or not – in one or both parties can stall a decision. These agreements answer questions like:

  • How will we build and maintain trust in our relationship?
  • What expectations do we hold of each other? (i.e., leadership behaviors)
  • What role and responsibilities will each hold in the organization?
  • Who will make what decisions and how will decisions be communicated?
  • How will we hold each other accountable?
  • How will we measure the partnership’s success and individual performance/success?

These agreements establish the foundation for the partnership. Without them, everyone enters into the partnership with their own unexpressed expectations, and that’s a recipe for failure.

If we decide to move forward, what will the transition plan be?

Having a clearly defined transition plan is a must for a successful partnership. All too often, I witness high trust that the partners will “work it out” and then, in the execution of the transition, the trust is tested over and over. Gaining agreement on the transition plan is a good trial of how the partners will work toward their first shared vision – a successful transition. Executing that plan together is the first destination in the journey of partnership.

Whether considering engaging in a strategic partnership, a business partnership where you will own a business together, or a merger/acquisition, answering the 5 key questions and doing the work that they encourage will increase the likelihood of making the right and best decision. I’ve experienced companies who have done this work and agreed to not work together. That to me is as good an outcome as a decision to move forward with the partnership because the cost of a bad partnership can be devastating.

The decision remains to be made on this partnership/merger I’ve mentioned, but one thing I know for sure is that they will have done everything possible to vet the partnership and, thus, will not regret whatever decision they ultimately make.

By Theresa Gale