News

Read about the latest developments at Shepherd and Wedderburn - as well as updates on the law. There are also details of our latest deals, and our media centre for journalists.

Media Releases
2005

10 June
2005

Communication, not finance, the key to constructive partnerships

Communication is the most important element of a successful business partnership according to the results of a new survey by law firm Shepherd and Wedderburn and the Scottish Leadership Foundation.

The survey of senior executives at a range of small, medium and large companies across Scotland found that communication was rated the most important aspect of establishing a successful partnership, while funding and finance was highlighted as the lowest priority.

Similarly, finance was not seen as a major barrier to making a business partnership work. Leadership issues, different working cultures and lack of understanding between partners were seen as much more troublesome hurdles than gaining economically from the partnership.

According to Zoe van Zwanenberg, chief executive at the Scottish Leadership Foundation, successful partnerships working across several diverse sectors must establish common communication channels before any major decisions are made. Zoe commented:

"Just as a happy marriage is based on good communication between two individuals, an effective business partnership relies on good communication between two or more partners. Business partners must establish the parameters of their relationship to ensure that communication continues. They must agree what is always to be discussed in full and whether certain elements of the relationship can be left unsaid. Hiding issues and difficulties from partners is the sure way of ending it.

"Too often economic pressures are given priority over every other element of the joint venture. Although funding is usually a vital element in establishing a partnership, on a day to day basis, it rarely becomes an issue. More often, conflicting priorities and a lack of distinct leadership cause tension between partners.

"Communicating effectively between two new partners is extremely difficult and, especially if one partner is from the private sector and the other is from the public sector, it can seem like they are both speaking foreign languages. In new partnerships, individuals can also tend to make assumptions or different interpretations. For that reason, partners must do more to work on communication issues upfront, particularly in joint ventures, mergers and takeovers."

Asked why organisations embark on partnerships in the first place, the responses to the survey varied from 'common goals' to 'sharing cost and responsibility'. 'Improvements to service delivery' and 'an ability to achieve more' were also identified as key bonds between partners.

Gordon Downie, a partner specialising in public law and regulation at Shepherd and Wedderburn commented: "Quite often the end goal of a partnership is its raison d'etre. However, when individuals within that joint venture begin to face difficulties it can be particularly taxing on all sides.

"Our survey showed that the main barriers to a successful partnership were seen by respondents as 'greed', 'poor communication' and 'lack of clarity over objectives'. All of these issues can be addressed with the help of professional advice at the partnership's inception.

"It is important that while the end goal remains the ultimate prize, targets should be set for the lifetime of the project. If targets aren't met, financial matters become overwhelming and communication channels breakdown, a fair solution must be found to protect all organisations."

Several Scottish partnerships were identified by respondents as being excellent examples of how organisations from a diverse range of backgrounds can unite to address common goals. Examples included Edinburgh Waterfront and Alba Campus.

Note to Editors:

Shepherd and Wedderburn's reputation as one of the UK's leading commercial law firms has been earned in part through our work with public sector clients. The firm is ranked in the top tier of legal advisers to local government by the two major legal directories, Chambers and The Legal 500. The firm currently advises organisations across the entire public sector spectrum, including local and central government, executive agencies, universities and higher education facilities and NHS Boards in Scotland and Trusts in England and Wales.


« Back to Press Releases