16 Jan Memories, Perceptions and Business

I have been going to write about this for a long time. I think they might call it Revisionist History.

Have you ever noticed that people tend to remember things based on their own perception of life? I guess it makes sense, since we all perceive situations differently. We grow up influenced by our parents, grandparents, siblings, friends, work colleagues, etc. All of those influences helping to make us what we are. Some influences are good, some bad. Those influences change the way we look at the world. Some people might call it wearing “Rose Colored Glasses”, or being an Optimist/Pessimist. Depending on the person and their attitude, the exact same situation/occurrence could be seen as very positive or extremely negative.

In the same way, history can be perceived by people differently. As an example, I have a friend who’s convinced that growing up, her mother was slow to get out of bed in the morning and left her and her siblings to get ready for school on their own, fixing breakfasts/lunches and arranging transportation. On the other hand, the mother remembers being an exceptional caretaker, being up early and taking care of all of her children’s meals. I saw something similar in my own family. I remember coaching Jr. Tackle football, going to ballet rehearsals and recitals, doing homework with the kids, taking them to the park, etc. My wife remembers me being gone on business trips most of the time, and raising our kids on her own.

Our memory is a funny thing, and it does often “play tricks” on us! It can negatively affect family situations, but it can devastate business relationships and even companies.

I have two friends that started a company together. Partner A had an idea and money, while Partner B had expertise. They started the company and each one received the percentage of shares that they agreed on. For one reason or another, the company got bogged down in product development and never really got off the ground. Later, another executive came in to the mix, managed to finish the product, and started securing partners and customers. Neither of the original partners is involved any longer in the day-to-day operations of the business and act as advisors.

Now it’s time for a round of outside funding, and any outstanding historical issues need to be cleaned up. Partner A wants to recoup some out-of-pocket expenses from the early days and document it with a note from the company to be collected upon exit. Partner B disputes the claim.

So, here is where the memory issue comes in. Partner B remembers quitting a high paying job to take a risk, join the company and take a shot at running it. Partner A remembers Partner B already being out of work, and asking to get involved while Partner A put large sums of money into the company to keep it moving forward under Partner B’s control. Their difference in memories will undoubtedly affect their relationship for years to come, but not really affect the issue at hand. The thing is, Partner A has receipts and documented expenses requesting to be reimbursed.

So here is the moral of the story: Contracts Rule!

There are soooo many examples of business people feeling like they have gotten “short changed” or “taken advantage of”. It is all because expectations on both sides were not clearly expressed and documented. I’ve been there!

Of course, there are cases of business people deliberately taking advantage of those who work for them, but I believe that happens only occasionally, and the biggest problem is around not setting clear expectations of what is going to happen for both sides. Silicon Valley’s standard procedure of using cash and stock options to compensate employees opens the doors to this type of misunderstanding every day! Inexperienced employees have all heard the stories about stock options and how rich some people have gotten as a result of such plans. They come in with an expectation of stock options turning into gold, not really understanding that those shares most often get watered down and become less valuable when the company takes new investment. But the idea that people are reading something like this share tips uk information, because they want to learn more about how to invest money into your company, is only good news for the future, even if your shares are affected. It will still be a lot of money and knowing that people see potential in the business should be motivation in itself. Plus, if they are worried about doing it themselves, there are always investment services with reviews from current users like a stash review, that they can check out to see if it is safe to use for their investment.

For the sake of yourself and those who work for you, I urge you to set clear expectations and document whenever possible. It might be mean an uncomfortable conversation now, but it will save a lot of heartache in the future. Even discussing things that you don’t want to think about when you first start your business, like potentially selling it, should also be discussed. It may never happen, but having an exit strategy in place when it comes to this area could be important to the future of your business. Sources like quicksprout (click here to learn more) have outlined how to sell your business in easy steps, so it’s also worth checking over this when you start your business. Always keeping these meetings documented though is essential. One great way of documenting those conversations is with a follow-up email. Email is the standard for business communications, because it has a time stamp, and each one has an ID number that can’t be altered. Any attempts to tamper or change email content can be identified, documented and traced back to the originator.

Set proper and clear expectations on both sides, and always document with a follow up email!

I’d love to hear what you think! [email protected]