The Power of Collaboration

We often read or hear news stories that spark the question: “What would I do in that situation?” Yet as much as we crave black-and-white answers, many decisions we make are colored by shades of gray in the ambiguity and complexity of daily life.

Take, for example, the paralysis in Washington over every issue, large and small. Because politicians on both the left and right confuse party platforms with principles, the very notion of negotiating an optimal solution with the other side is often considered a betrayal by party loyalists. Somehow it seems that collaboration with other Americans has become unpatriotic, and intransigence has emerged as a badge of courage. Now, instead of pondering “What would I do?” many voters long to cry “Here’s what I would do!” Especially voters who have the experience of managing a company.

Imagine if a business leader did not consider all the facts, instead relying on limited personal experience and private pledges. Imagine if a CEO ignored the views of customers, employees, vendors and bankers in crafting an initiative. Please note, this discussion pertains to business leaders whom you admire. It seems obvious that accepting constructive input from multiple perspectives enables leaders to collaborate effectively with partners and to strengthen the firm’s end results.

Bear in mind that the goal is not to maximize a result, but to optimize a result. All things considered, what’s the best outcome the firm can strive for? Many small business owners find the politics of larger organizations distasteful, preferring to make decisions independently. In reality, however, politics exist whenever two or more people are involved. Politics is really the art of getting along (so it makes the circus in Washington doubly painful to observe).

As financial advisory firms grow larger and mergers become more commonplace, the art of getting along assumes further importance. Changes to a firm’s structure mean the introduction of new ideas and new personalities. As a result, many firms strain under the weight of egos, “me-too-ism” and the visceral hunger for the spotlight. Like vaudeville performers elbowing aside others on the stage, both the stars and the wannabees strive to be seen as the spokesperson, the arbiter of good judgment and the final say in all things.

Advisors who are new to partnerships and thus fear challenges to their position may see collaboration as a sign of weakness. The reality is that collaboration is an indication of strength. Learning how and why to collaborate creates an opportunity to leverage the power of others, obtain a window to one’s blind spots and shore up the firm’s weaknesses for the future.

You’re Not the Boss of Me
A recent conversation with relatively new partners in a growing advisory firm brought the issue of collaboration to light. One partner possessed strong administrative skills and had managed the larger firm that ultimately became the dominant culture in the merger; the other partner previously was a solo practitioner with a big personality who drew clients from around the country and who was perceived by many as an industry leader. The former loved the latter’s ability to make rain, and the rainmaker loved the larger firm’s ability to support his practice. On paper, at least, the synergy looked great.

Yet about two years into this merger, the leaders’ divergent approaches have already put the partnership at risk. They seem to talk past each other, not to each other. As their mutual hostility grows, their desire to listen to the other’s point of view diminishes. While an observer might have predicted this natural discord, merger parties commonly overlook personality conflicts when the potential of combining the two businesses is so compelling.