The Partnership Charter©
Having partners requires frequent negotiating. Ideally, most of it's done upfront, when partners are setting up their business. But most partners are too busy with all that is involved in launching their company (finding employees, money, office, etc.) to take time to negotiate the in's and outs of being partners. Besides that, some of the issues are sensitive and easy to avoid or skim over.
Another reason why partners don’t negotiate their partner arrangement when starting out is they simply don’t know all the issues they should be negotiating. Partners are usually experts at their business, not at being partners. Nobody’s trained in how to be partners because it’s not even taught in business schools or law schools.
Partners can nail down certain legal documents but having legal documents in place often gives people a false sense of security. Legal documents fail to deal with the complete range of business and interpersonal issues that create conflict among partners.
That’s where a Partnership Charter comes in. ENNIS Legacy Partners is an authorized user of this unique, structured process that guides partners, or potential partners, through in-depth discussions covering 12 different topics.
The PC Workbook helps each partner prepare thoroughly for a series of meetings in which the partners discuss, negotiate and reach agreement on everything from their personal values, personality styles and expectations, to roles, money, decision-making, ownership and how partners will exit the partnership. Dr. David Gage, who designed the process more than 20 years ago, calls these Discussions, Negotiations and Agreements, the DNA of partnerships.
The PC process will also give you a document – the Partnership Charter – that contains everything a neutral attorney needs to produce highly customized legal documents. But more importantly, the PC is a document that will guide you and your partners in your day-to-day working together as well as through major transitions.
The Workbook can be utilized with more or less assistance from ENNIS Legacy Partners. The standard options include:
Self-Directed PC Option. In this option, the partners prepare for their discussions and negotiations using The Partnership Charter Workbook and then conduct their discussions and negotiations themselves. They document the understandings and agreements they reach in their Charter using a template. Conducting the discussions and negotiations without a neutral third-party mediator can be challenging, so this option is offered for partners with limited resources. With the Self-Directed Option, a professional trained in the PC process provides the following:
a) A one-hour webinar orientation to the Partnership Charter method with specific recommendations for optimizing the process
b) Assessments of personal styles, personal values and conflict styles
c) MS-Word versions of The Partnership Charter Workbook to prepare partners for their discussions and negotiations
d) An MS-Word template for drafting a Partnership Charter
e) After the partners complete their Charter, an experienced PC-trained professional spends five hours reviewing it and providing written feedback that highlights potential pitfalls in the agreements, important issues that may need further consideration, and other suggestions for enhancing the Charter and the partnership.
f) A one-hour question-and- answer phone call with the professional who reviewed the PC is scheduled to go over the written feedback and address any remaining issues.
Guided-Retreat PC Option. In this option, after the partners prepare using The Partnership Charter Workbook, either one or two mediators skillfully guide the partners’ discussions and negotiations during a PC retreat (or series of meetings). Professionals trained to ask the tough questions help partners speak openly and candidly with one another to ensure that sensitive issues are explored in depth. This process ensures that partners thoroughly understand the complexity of their partnership and the interrelationships of the various elements, from equity to compensation, and styles to decision-making authority. It builds the partners’ confidence that they know where they’re headed, what their end game is and how they will get there. Most retreats last 3 or 4 days. In addition to items a) through c) above, in the Guided-Retreat Option,
a) Facilitators/Mediators guide the partners’ discussions and negotiations during an intensive PC retreat (or a series of day-long meetings)
b) During the retreat, the mediators meet with the partners together and also separately in private caucuses where they coach partners confidentially
c) Depending on the partners’ needs, the mediators may assist between meetings with specific questions or issues that arise
d) The mediators record all key understandings and agreements the partners reach and include them in a draft Partnership Charter
e) The mediators follow-up with any needed partner coaching to ensure the PC implementation is proceeding as planned and the partners are making any needed adjustments to their PC.
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