Strong business relationships can go a long way to help your company, but when a relationship is damaged, there are six meaningful steps you can take to repair it.

A successful business is all about having successful relationships with your customers, shareholders, investors, business partners, vendors, regulators and even the competitors in some cases.

Building and maintaining good business relationships with your business associates requires time and effort from you and the other party involved to establish a healthy level of understanding, openness, integrity and trust. But when disputes or other unfortunate events reduce the level of trust and damage the relationship between you and the other party, it is time to review the situation and do your best to repair it.

It is worth bearing in mind that a damaged relationship should not go unresolved for too long because it may end up causing both parties stress or even financial hardship, particularly when solicitors are involved and the case goes to court. Relationships also tend to outlast companies, so maintaining healthy relationships can go a long way to help you professionally. If a damaged business relationship is needing your attention at this moment, here are the six steps which can help you get a business relationship back on track.

1. Identify the issue

The first step in repairing any relationship is to recognise what caused it to breakdown. Ask yourself what went wrong and also talk directly with the other party to get their perspective. While there are numerous causes, common issues include:

• Poor communication
• Lack of collaboration
• Lack of respect
• Unmet expectations
• Money
• Unequal commitment between parties
• Differing values
• Personality clashes

Listening to the other party is key – understand that in a healthy business relationship, you and your business associates tend not to get upset with each other unless the trigger point is something serious. So the best approach is to assume nothing, but ask questions, listen attentively, and seek to clarify.

2. Tackle the issue

Once the problem is identified, a discussion is due with the other party to address it and stop it from escalating further. Sometimes disagreement is unavoidable, but it does not mean both parties cannot discuss the issues calmly and professionally. Avoid making personal attacks or taking things too personally.

3. Admit your mistakes

The moment you realise that it was you or someone in your team has caused the other party to take offence, acknowledge the mistakes immediately and show your commitment to change. Do not hope that the misstep will be forgotten or even forgiven. Remain in control and readily admit any wrongdoings is a sign of maturity and leadership.

If the other business party caused the mistakes – despite an apology is welcome, do not insist that they must apologise. Sometimes people may fear that their apologies will lead to further accusation and conflict, or they simply want time to process their emotions. Let it go if you can, and if you handle the situation gracefully, you will undoubtedly earn respect from your business associates.

4.  Conflict resolution

Conflict resolution is at the heart of negotiation. Once you learn what has caused the business relationship to fall apart, you can engage the other party with a greater level of confidence and make sure that the objectives are aligned. If you would like to know more about the benefits of negotiation skills, this post Why negotiation skills are important for small business owners may make a good read.

5. Formulate next steps

Once the issues have been confronted and everyone has had a chance to air their grievances and cool off, it is time to formulate a plan on how to move forward collectively. A huge part of creating a plan is managing the other person’s expectation. Good questions to ask include:

• “What would you like us to do to rectify the situation?”
• “How do you see we can move forward?”

Defining and agreeing on a clear process moving forward, including how to resolve further conflicts in the future, will allow both parties to work effectively.

6. Rebuilding trust

To rebuild relationships, you need four secret ingredients – respect, empathy, trust and most importantly, communication. Take the step to show your business associate that you are ready to collaborate and you are committed to building a strong, long-term business relationship with them.

Rebuilding trust does not happen overnight. It requires both parties to communicate clearly, recalibrate objectives and celebrate success.

It pays to think about how you should communicate with your business associates so that nothing gets misinterpreted. If you are using email, it is essential that you make sure they can’t interpret your emails out of context. Communication in person is always preferred, even in this digital age.

Build healthy business relationships

For small business owners who are keen to work with everyone, having a damaged business relationship often causes unnecessary stress and financial hardship. So before any business relationships become unbearable, ask yourself what you can do to prevent the relationships from falling apart. The following exercise may help to influence your business relationships positively.

• Describe your business relationship with each party that is vital to the health of your business. The party can include but not limited to your customers, shareholders, investors, business partners, vendors, and regulators. Ask yourself if the relationship is healthy (meaning goals are aligned)? Or is the relationship tense and adversarial?
• Ask yourself what you can do to improve the business relationships, particularly the challenging ones? Put yourself in the other party’s shoes and see the situations from their point of views.
• Focus on win-win even if your actions are not being reciprocated. Focus on the future and ready to be an ally to them is always better than waiting for someone else to change the game.

Berley is here for small business owners

As small business accountants in London, we have seen first-hand how healthy business relationships can help to drive growth. Within the company, our teams also work relentlessly to establish and maintain healthy relationships with our clients, our vendors, our partners, and even with ICAEW (The Institute of Chartered Accountants in England and Wales) which we are members.

Strong relationships help create a sustainable and successful long-term business structure. As a small business owner, if a damaged business relationship requires your full attention, and if you need a pair of helping hard to review certain financial numbers at the heart of the broken relationship, do not hesitate to give one of our small business accountants a call on 020 7636 9094. After all, we are here to ease your accounting workload, provide trusted financial advice and manage your regulatory risks.

Our services include:

• Bookkeeping
• Business finance solutions
• Management accounts
• Tax
• Outsourced payroll services

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• How to generate more sales for your small business
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• Can giving shares to your family members help you save tax?

This post is intended to provide information of general interest about current business/ accounting issues. It should not replace professional advice tailored to your specific circumstances.