Learn effective tools to navigate conflicts
Many pizzerias are owned in partnership. Whether it’s a multi-generational family operation, friends pursuing their pizza passion together, or a purely business relationship, having multiple owners has many advantages. It allows you to share the responsibility, workload and financial burden while expanding your business’s pool of expertise.
However, conflicts will eventually arise.
Richard Birke, a dispute resolution service provider and law professor, reminds us that it’s “very important for people to be mindful that not all conflict is bad.” Birke is senior vice president at JAMS Dispute Resolution and executive director at the JAMS Institute, the teaching division of JAMS. When disagreements “generate a lot of different ideas and people are defending their ideas, that’s good.” He observes these “thoughtful debates are going to create better options and it leads to better outcomes.”
If you want to your business to thrive, dealing productively with conflict is essential. It’s important to accept that clashes are inevitable and not an inherent problem. Plan ahead to avoid them and bring your best self to the negotiating table when addressing them.
PREVENTING BUSINESS OWNER CONFLICT
Here’s how to minimize conflict in the first place, and strategies to deal with it when it does come up.
Set Clear Expectations
Ideally, you made clear agreements on dividing responsibilities when launching your partnership. If you didn’t, do it ASAP. Consider each party’s experience, expertise and passion, and lay out individual responsibilities in detail. In addition to averting conflict, this should also help prevent important issues from falling through the cracks.
Put It in Writing
Put your agreements in writing. From a purely operational perspective, having everything written down improves clarity, avoids confusion and doesn’t rely on anyone’s imperfect memory. “Written communication is very effective,” says Dionne M. King, CEO and strategic consultant of DMK Consults, where she provides alternative dispute resolution, diversity and equity training and executive coaching. “It allows us to go back and refresh our memory – this is what we agreed on, this is why we agreed on it.”
From a legal perspective, having an attorney ensure that you’ve covered everything is a good idea. Even the smallest pizzeria is a huge financial undertaking, and setting up a legal partnership protects all partners and their families.
Respect Your Partners
You entered into partnership because you valued and respected the other person’s contributions. Show your respect by listening to their input and resist micromanaging them. The flip side: understand and respect their limitations. If their main skill is financial, don’t expect them to run the kitchen.
In addition, “people need to feel psychologically safe,” emphasizes Birke. “In order to prevent disputes, you need free-flowing conversations. If somebody feels like they can’t hear or bring up something negative or raise a new idea without it being shot down, that’s a problem.”
ADDRESSING CONFLICT WITH BUSINESS PARTNERS
Be Proactive
It’s important to be proactive and address conflict early. Don’t let a small problem grow into a big one by avoiding the discomfort of addressing it. According to King, common problems include “they don’t have the words, they don’t have the skill set, they may be fearful, they are avoiding conflict, and so they just don’t communicate.”
However, always take a cooling-down period if needed before starting a dialogue. Don’t “approach someone in anger and high emotions,” says King. “Take some time to calm down, think through your words, maybe write down what you want to say, and then meet in a neutral place.”
Communicate Effectively
Birke advises that “it helps to start with separating our productive disagreement from unproductive disagreement. I think about that as task conflict versus relationship conflict.” When you are deciding on concrete matters that have several different and legitimate perspectives, such as pricing or expanding, “and people are defending their ideas, that’s good.” However, “if people aren’t listening to each other well, are taking things personally, that’s an unproductive kind of conflict,” explains Birke.
King suggests these communication tips:
- Tone down your volume.
- Choose your words carefully.
- Repeat what you’ve heard to make sure you’ve got it and to reassure the other party.
- Listen actively.
- Consider cultural differences in how people express themselves.
Before you start the conversation, King says you should know what outcome you want. “It could be something like I really want to resolve this because I love working with you. I know we share the same desire for this to be successful. Let’s put our heads together and come up with something.”
Identify Everyone’s Motivation
When you’re communicating about disagreements, identify everyone’s motivation. If one partner is motivated by cost cutting and another by customer satisfaction, negotiate about that higher-level difference of opinion, not about the nuts-and-bolts of implementation. “Identify interests, yours and theirs,” says Birke. “Create options to meet those interests and compare them to the alternative if you don’t resolve the issue. Focus hard on the problem and be easy on the people.”
FORMAL CONFLICT RESOLUTION STRATEGIES
If you and your partners can’t discuss your way out of your conflict, you may need to take formal steps. According to Birke, there are four primary strategies: mediation, arbitration, litigation and dissolving your partnership.
Mediation:
In mediation, a neutral third party helps the quarreling partners communicate and come to an equitable solution on their own. A professional mediator has the skills to help people share their perspectives constructively and come to a mutually agreeable, non-binding agreement. In Birke’s experience, “most people wait until they’re in litigation and their lawyers or a judge recommends mediation. It’s often by that time become very expensive, so I say pursue mediation as early as possible.”
Arbitration:
Arbitration is the next level of formal negotiation. Arbitration involves a neutral third party serving as a judge who resolves the dispute by listening to both sides and rendering a binding decision. Arbitration can involve lawyers and evidence, as decided by the parties in dispute. Both parties enter into arbitration recognizing that the decision cannot be appealed. The resulting evidence, negotiations and agreement remain private.
Litigation:
Both mediation and arbitration are much more economical than the next option: litigation. Litigation entails lawyers and a courtroom, with a judge or a judge and jury. Lawyers argue on behalf of each party and the judge (and jury, if applicable) will make a ruling. This takes place in court and the trial is entered in the public record. On the one hand, Birke says that “lawsuits are often the only way to get people’s attention.” However, he also says that 99.4 percent of all lawsuits are resolved by negotiation, mediation or arbitration, so escalating to the legal system should be a very last resort.
Parting Ways:
If mediation, arbitration, and litigation leave you unsatisfied, it may be time to dissolve your partnership. Birke observes that sometimes litigation is “going to be so expensive relative to the cost of the dispute that walking away may be your best alternative. And that has costs as well.” This is an extreme response to an extreme situation, and it’s likely to still require some legal assistance. Ideally, your initial negotiations with your partner(s) included an exit strategy to help streamline this process.
While friction is inevitable between partners, you can help ensure the best possible outcome by anticipating conflict, communicating in the calmest and most skillful way you can, and enlisting an experienced mediator as soon as the need arises. Overcoming your disputes promptly and effectively will improve your business while also increasing peace of mind for all partners.
Annelise Kelly is a Portland, Oregon-based freelance writer.
