How to Fix a Business Partnership That is Failing

Bryant Galindo
5 min readMar 19, 2024

Five steps that’ll help you identify the root cause of the partnership issue while rebooting foundational trust between the business partners.

When you’re building a business with co-founders/business partners, a strong partnership will be the cornerstone of its ultimate success.

However, like any relationship, business partnerships can face challenges:

  • What to do when disagreements arise
  • How to manage performance disparities
  • What to do when interpersonal conflict erodes trust
  • Or how to manage or scale the business when differences in vision, strategy, or resource allocation occurs

When this happens, it’s essential to take proactive steps to repair the partnership before it’s too late.

Here are five steps I recommend for navigating through a business partnership that is failing, helping to restore the foundational trust that makes a business relationship high-performing.

Step 1: Acknowledge the Issue

The first step in healing the strained partnership is acknowledging that there is a problem.

It’s easy to ignore the signs of conflict or hope they’ll resolve on their own, but denial only makes it worse.

Openly acknowledging the issues at hand allows all partners to move forward with a solution-oriented mindset. However, do not personalize the problem. Use the OIC Model to help you do just that.

Copyright: CollabsHQ

To use the O.I.C. Model effectively, find observable behaviors that the other person has done, discuss its impact on the business, and then ask for a change. An example on how to do this is below:

Example 1: “When you fail to answer emails in a timely manner [Observation], it affects our ability to properly execute on tasks [Impact]. Could we talk about what a reasonable timeline could look like? Maybe respond by EOD on the important tasks that need to be moved forward? [Change]

Allow this model to inform how you go about Step 2 below.

Step 2: Dialogue

When things go south, it’s crucial to establish an open, honest, and respectful dialogue.

Encourage each other to express concerns, frustrations, and expectations without fear of judgment. I recommend clients use the Collaborative Disagreement® Model to help them communicate.

Copyright: CollabsHQ

Focus on creating understanding between everyone involved, openly talk about the issue via a back-and-forth dialogue, and pave the way for solutions via constructive problem-solving.

This openness may even shed light on more or other underlying issues.

Step 3: Identify the Root Cause(s)

To effectively address the issues within your partnership, it’s essential to identify their root causes.

Are the challenges related to misaligned goals, unequal efforts, or external pressures? Or are there things that are being unsaid, unfelt, or both? Enter the conflict iceberg to help you figure it out.

Copyright: CollabsHQ

When we’re in conflict and disagree, everything above the iceberg is what we see and feel. However, going deeper reveals more — and usually this contains the root cause of the disagreement. Use the below questions to help you identify what that may be for your situation.

Copyright: CollabsHQ

Understanding the source of the conflict will help tailor your approach to resolving it.

Step 4: Realign Goals/Expectations and Develop an Action Plan

Over time, it’s common for partners’ goals and expectations to diverge.

Take this opportunity to revisit and realign your objectives. Ensure that both parties have a clear understanding of the partnership’s direction and what is expected of each other moving forward. With a mutual understanding of the issues and a commitment to move forward, develop a detailed action plan. This plan should include clearly defined roles, responsibilities, and measurable benchmarks for success, providing a roadmap for the partnership’s recovery and growth.

Pro Tip: In times of conflict, it’s beneficial to refocus on your strengths. Your roadmap should leverage each other’s capabilities that will enhance the partnership’s effectiveness and morale while minimizing any weaknesses.

The process of repairing a business partnership is ongoing. Regularly evaluate the progress being made towards resolving the issues and be open to making adjustments as needed. This flexibility allows the partnership to adapt and overcome obstacles more effectively.

Step 5: Seek External Advice

Sometimes, an external perspective is what a partnership needs to navigate through its difficulties.

Whether it’s a business coach, a mediator, or a trusted mentor, a third party can offer unbiased advice and facilitate more productive discussions. They can help identify solutions that might not be apparent to those directly involved in the conflict — and could help save your partnership and, ultimately, your business.

As a mediator, I have worked with dozens of early-to-late stage startups and established businesses in helping them reboot their business partnerships. If you’re curious to learn more about mediation and how it can help you, read the article below.

Bottom Line

Repairing a business partnership requires patience, dedication, and a willingness to work through challenges together. By addressing issues directly, communicating openly, and focusing on mutual goals, partners can navigate through tough times and emerge stronger. Remember, the goal is not only to resolve the current conflict but to build a more resilient partnership capable of withstanding future challenges. That will help rebuild the trust that was lost.

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Bryant Galindo

I help startup founders and business executives resolve disputes while helping them become the best leaders possible 🤝 More at www.collabshq.com