Challenges & Solutions approach to improve synergy among directors in small, emerging organizations

Except for a few organizations, most of the small, emerging organizations are managed by founder supported by other co-founders or directors. The directors can be family members, friends, or joined in the organization as working partners thanks to a common interest in the business or some other value proposition.

Generally, partnership management provides more advantages than running as individual ownership. However, if there are no clear policies, terms that governed the partnership relations, it leads to chaos in the system, affects the business performance as well as affect the quality of relationship among the partners.

I have observed some of the typical challenges in a partnership firm among the directors or partners

1. Clarity on sharing job responsibility and accountability

2. Communication among the partners

Above challenges lead to decision dilemma or delay in decision making, which affects the business profitability and growth.

1. Clarity on sharing responsibility and accountability :

One of the common practices, I observe in most of the emerging organization is that all the directors involved in ALL management activities. In this process, at the end of the day, nobody is accountable for the business results as each one aware of the proceedings and get convinced themselves about mediocre performance.

When everyone is getting involved in a particular business issue, the decision dilemma arises as who has to take a final call or decision on the problem. People love to discuss the problem, challenge each other, ready to brainstorm, and when coming to fix the solution and fix the person for accountability, they stuck to decide. This decision dilemma is mainly due to the lack of portfolio or role clarity among partners.

When I see this pattern in one of our client’s organizations, suggested for defining a clear portfolio for each director by defining roles and responsibilities. (But, already they have a designation for each director with functional orientation say Director -Operation, Director Marketing). Also, we had set the KPI’s for each partner to bring transparency on results, in turn, accountability.

This process had resulted in clarity among the directors, and they felt their productivity also increased. Also, when coming to business decision making, the clarity on responsibility and accountability helped them to take quick decisions which affecting their function as well as the business.

2.Communication among Partners :

One of the reasons everyone get involved in all activities is due to a lack of a structured communication process among the directors. Each one of them wanted to be included in all activities to avoid miscommunication or relationship issues among them. However, this leads to only time consumption and delay in decision making.

Also, the organization instills mediocre performance culture, and in some organizations, people at middle management take advantage of the multiple director’s management styles.

when we come across in one of the clients, we suggested two methods to overcome communication issues

1. Weekly Review Forum for all directors to share, review weekly critical performance like sales, finance and other important business issues

2. Common KPI sharing among the directors on Google share

3. Monthly Executive meeting to review P&L before 10th of every month as this will give overall business performance among all the partners

The above solutions approach helped the partnership organization to overcome the typical challenges faced by the partners and also helped them with personal productivity.

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In my view, the advantage of the partnership firm is to share the resources, gains, pains of entreprenuerhsip and move fast together. If the partnership relationship is not rightly defined and executed, the advantages will get defeated and the organization also struggles for profitability and growth.

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