The BETTER AGREEMENT GUIDE™
BETTER BUSINESS is in The BAG™
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JOINT VENTURE AGREEMENTS
Pioneers are motivated by drive to achievement and by irrational optimism rather than by reasonable calculation. If those who start a business rely on nothing but mathematical expectation enterprise will fade and die. John Maynard Keynes A joint venture is an agreement between two or more organizations who undertake a project together. As the world becomes more virtual, the need for what "strategic partners" can bring to joint ventures will become more pervasive. The good news lies in the possibility of achieving the best of all worlds by being able to put great teams together for specific projects without taking on additional staff. The challenges lie in quick integration, coordination, and control. People starting a joint venture often posture for protection. Unfortunately, as you are aware by now, posturing takes the focus off the vision of results that generated the initial excitement and optimism about the project. I recently was part of a team organizing a joint venture between the Law Practice Management Section of the American Bar Association (LPM) and a private conference promoter, Legal Management (LM), to sponsor a law firm management educational conference. Here's the joint venture agreement I crafted Law Firm Management Institute 1. Intent and vision: Our intention is to produce an educational conference called the Law Firm Management Institute in the fall of 2002. Our vision for the conference is that it will be modeled after the success and growth of LPM TechShow. We want it to become the place where people come to gather leading edge information that will help them deliver legal services in the most profitable and efficient way. In the first year, it will be a single track, two day conference targeted at people with management responsibility managing partners, general counsel, practice group leaders, administrators, and senior managers. As the conference becomes more successful, it will be expanded to three days with additional tracks for corporate law departments, government law offices, small firms, and solos. 2. Roles: LPM will be primarily responsible for content design and securing speakers. LPM will also add its identity and logo. LM will be responsible for financing, organization, and administration as more specifically defined by the promises that follow. 3. Promises: LM promises to take care of
5. Measurements of Satisfaction: We will consider this program successful in the first year if we have 200 paying attendees, generate $50,000 after expenses, receive average evaluations of 4.5 points on a 5 point scale, and decide to repeat and expand the conference next year. 6. Concerns and fears: That attendance will be low; that the quality of speakers and programs will be less than outstanding; that it will not be profitable. 7. Renegotiation: Given that this is the first year of this joint venture, we anticipate a great deal of renegotiation because we have not done this before. 8. Consequences: Both parties' pride will be hurt if the conference is not successful. 9. Conflict resolution: We will continue to talk until we need to find a mediator to help us. 10. Agreement? Yes, we look forward to working with each other. Given the context, it is amazing to note the lack of legalese and protective language. For me, this is very telling. At a place more profound than their professional skills, lawyers understand that working well together is about trust and collaboration. You would be surprised at how many law firm partnerships do not have written agreements. Summary:A joint venture is an agreement between two or more organizations who undertake a project together. Often people starting a joint venture posture for protection. That takes the focus off the vision of results that initially generated excitement and optimism about the project. Exercise: Are you facing a challenge for which you don't have the knowledge and experience? Is their a person or organization that does have what you need? Have you considered asking them to participate in a joint venture? If you can identify a potential partner, use the agreement to structure a dialogue to discover if a joint venture is appropriate. |
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