Trust me!

I was recently advising an alliance manager who was desparately trying to manage expectations with a new partner in the face of a sales manager who is fond of "gentleman's agreements". The sales manager's logic was that he "trusted" the partner and therefore the parties "didn't need to have anything in writing".

Here's the problem with that logic. Is there a time and a place for "handshake" agreements? Yes. Is that time when you are establishing a partnership with a new partner. Decidedly no.

In these scenarios, I am very wary of parties who do not want to put things in writing, especially when the rationale is essentially "trust me". This is not trust. It's "faux trust" - bet hedging masquerading as trust - and a sign of someone who does not want to commit.

Here's why. In my experience, when you embark upon a collaborative initiative on a handshake, when things go either very well or very badly, people tend to get situational amnesia. When things go badly, people normally start heading for the exits. On their way out the door, sometimes they also try to shift blame for the failure to the other party. When things go swimmingly well, sometimes greed ensues, and one party will seek to cut the other party out of the action. That's why being committed to the venture (you both either sink or swim together) is an important success factor.

My advice to the alliance manager - if the venture is worth the time to do, it's worth the time to document. Depending on the situation you may not need a formal contract, but at a minimum, you should document the expectations, roles and responsibilities of both parties, and most importantly, what happens if expectations are not met. You should also make sure that ALL the stakeholders that are impacted by the joint plan are informed of the plan and expectations and that they sign off on those expectations!

When you take the time to put things in writing you are saying to the partner, I respect your time and investment in this project and I trust that our odds of mutual success will be much better if we have clarity around our joint gameplan and the expectations for execution.