May 23, 2022 by Dymphna

T-Bomb: How shared-truths prevent JV disasters

Truth Bomb Tuesday: If you want honesty, get it in writing.

“I just wish they would be honest with me.”

I have seen quite a few joint ventures go pear shaped in my time.

Not within my community. We are super-big on making sure you get everything down on paper, and getting the right contracts in place.

Too many people just rely on trust or think that they no someone and can’t imagine them ever being unreasonable.

Worst of all, they do this with their own family. “We don’t need a contract, we’re brothers.”

This often ends in disaster.

As a general rule, the more important the relationship is to you, the more important it is to protect it with clear contracts and agreements.

So do that.

But I was thinking the other day that one of the things I hear a lot from people in the middle of a messy joint venture is, “I just wish they would be honest.”

It’s a funny one.

It’s funny because we think honesty is an ideal.

It is in the general, but not in the absolute.

If I ask my husband if these pants make my bum look big and he says, “Yeah. Massive.” I’m not going to be all that happy about that.

We practice careful and loving deceit all the time. An answer like, “Well dear, I don’t really love that cut of a pant on you, but they do bring out your gorgeous eyes,” is obviously I lie, but it’s a lie that makes me feel cared for.

So we do this stuff all the time.

But in the middle of a JV breakdown, I see people put huge emphasis on honesty as an absolute. They demand complete and total honesty.

Partly this is because they feel like they’re in a situation where they don’t have full control, and so the more facts they have on the table, the better they feel.

But partly its because their counter-party isn’t working with the same truths they are.

When you have a picture of the world that naturally lends itself to certain conclusions, when someone doesn’t agree with your conclusions, you feel like they’re being dishonest and deceitful.

They might be.

But for every messy JV break-up that occurred because someone was being a snake in the grass, I reckon I’ve seen another 10 that have just gone pear-shaped because the two parties are just seeing things differently.

Maybe they understood things to mean different things. Maybe there were just assumptions that were never clearly stated. Maybe they’re just interpreting things differently.

But what you end up with is two distinct truths – two truths at odds with each other.

And once you’re there, it’s very hard to reach an agreement because the only way to do it is to harmonise these competing truths into a shared truth, and that can be a massive process.

So the key here is to be proactive with this process.

Hit it up front. What a contract or a set of agreements does is it creates a shared truth from the get-go. It does it when it’s easy to do, before there is money and heart-ache on the line.

Construct your shared truth early, and you’ll save yourself a lot of headache and heartache down the line.