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The things that deteriorate are the ones we notice first. If we remain observant – something inadequately taught to the young these days – we see renewal, new life, new purpose, gradually an awareness of the problems of the world and significant numbers of people working quietly away to make life better for others.

McKinsey has revealed that organisational change is often thwarted by employees resisting it, especially the more influential ones. We need, they say, to persuade these innate leaders if change is to be effectively achieved. I am sure they are right; change is usually resisted, often for the wrong reasons.

But I question the extent of the constant change being perpetrated everywhere. I am not a Luddite trying to retain out of date machinery and systems. I want us all to benefit from the new technical discoveries. I also want everyone to enjoy life. It seems that organisations are promoting change largely for their own benefit and not much for the customers’.

“Externalising costs” – that chilling phrase heralding the disappearance of someone to talk to – brings with it customer queues in person or by phone, a plethora of Frequently Asked Questions (only not the ones you want answered) and an almost total absence of real service. Someone needs to point out that customers’ time is as valuable as suppliers’ time. This must be done effectively not left as merely a self-evident statement.

Someone also needs to act on the fact that the high and growing unemployment rates around the world could be reduced if service were once again to become a byword of good supply. So how do we arrange that suppliers pay for keeping their customers waiting or causing them unnecessary difficulties?

It is already done in some areas of business. A ship or train that cannot be prompt at its mooring to unload pays ‘demurrage’, a fine for causing disruption. Why should not a late arriving delivery from a supplier do the same? Is it beyond the wit of humans to devise a way in which a supplier creating unnecessary extra work or delay for a customer could be charged for doing so? A builder who fails to meet his deadlines feels it in the pocket. Why cannot others?

When first in business I was taught to ask a vital question before hiring a new employee: ‘What will happen if we do not employ this person?’ It saved many unnecessary hirings and made for a tighter, lighter ship, easier to navigate. Before structural changes are made to a business, before customer services are further reduced, could we pause and ask ‘What will happen if we do not make this change?’

Is it possible that customers might just be better served? Is that too novel an idea?

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People work well together when they like each other, have some common interests and usefully complementary skills and, above all, trust each other. It is difficult to trust someone with whom you cannot communicate easily so good interpersonal communications is a pre-requisite to trust. Part of the shareholders / partners agreement mentioned in yesterday’s Daily Paradox “Partners in Business”, will deal with what happens when communication or trust breaks down. Agreeing a sensible basis for separation is vital.

The criteria for working with a partner start with knowledge. If you are planning to build a business together you must know each other and getting to do so is time well spent. Brief office meetings will reveal no more than the polite façade. Agree a joint interest other than work and devote time to doing it together.  This may seem to be a trivial or side issue; it is not. The key to making things work is making people handle them together.

It is easy to point to successful partnerships that involve a lot of conflict. What is difficult is to know the points at which they agreed. Rolls and Royce were from completely different backgrounds; Gilbert and Sullivan ended up barely speaking to each other. Both partnerships were highly successful. Nureyev and Fonteyn were no kindred spirits socially or by background but they shared a passion about ballet that made them among the greatest dancers of all time.

Partnerships are not made from what we agree about but from important matters about which we don’t disagree – not a simple concept but understanding it eases the partnership path. The reason that marital relationships initially succeed (and sometimes subsequently don’t) is because sex is a common interest until it becomes boring or unacceptable to one of the parties.

Certain fundamental rules apply to successful partnerships that will last.

First, politeness is a feature of what works for more than the short term. Good manners make any relationship more durable. Bad treatment that sometimes comes with familiarity is a cause of more broken partnerships than almost anything else.

Second, expectations have to be managed. What each partner brings to the business is unique and valuable. In many partnerships it is quickly assumed to be that partner’s basic contribution and other partners start assuming a right to further inputs above and beyond what was agreed.  This is especially true of funding. A partner who is generous will be assumed to be rich and therefore a source of incremental funds. Most partners quarrel about money sometime.

Third, while great partnerships can develop into almost any area of business they should start with a limited and modest aspiration. Listen to two people discussing a possible business start-up. They will often talk of expanding the Great Idea into a truly big operation, international and forever growing. This may sound visionary but in reality it is a way of avoiding the small details about the initial business by thinking big. Attention to detail must be one of the partners’ responsibilities.

Taking a working relationship for granted is a sure way to end it. A good partner never assumes that another partner is in full agreement even when they raise no objections to a course of action. The shared interest I mentioned earlier should be revisited from time to time to allow for informal discussions about how the relationship is working.

A true partnership is as big an asset as a business gets. It needs nurturing.

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Increasing startups have led to many questions coming my way about partnerships and how they can best be created, maintained and, if necessary, broken up. The need for partners is obvious. Enterprise involves creativity, analysis, thought and forecasting, all of which require stimulus from sources outside ourselves. A good business partner acts as that stimulus and is in turn stimulated by our ideas. Great partnerships are legion; failed partnerships are seldom recorded but there are many more of them.

If we cut out the obvious “apple-pie” requirements of a partnership we can concentrate on the vitally important but often overlooked practicalities. First, what is the business offering as product or service? Writing mission statements may (or may not) be good investor relations but it won’t help you start a good business. Define what you are selling as a half-page advertisement in a broadsheet newspaper. Do a rough sketch of product if you want to but concentrate on the words. You have 100 words maximum to sell your wares, roughly the same as this paragraph.

If you already have a partner in mind – someone, perhaps, with whom you have been exploring or developing the idea, get your partner(s) to do the same – on their own and without collaborating. Comparing what you have both (or all) written will tell you more about your partner(s) than any other single act. You will also have a good description of your business when you have done this – but to be doubly sure, show it to a few friends who do not know what you are planning but who have a sense of business. If they understand it, it has passed the test.

Draft a shareholders agreement at the outset. This agreement incorporates a very simple strategic plan – nothing lengthy or complicated. If it runs to more than two pages it is wrong. Your shareholders agreement will include your exit strategy, as part of the plan. Your exit strategy tells you at what time and at what price you think – as of today – you will sell the business. That strategy does not mean that you will exit at that time. Your thinking will change as the business grows; you wrote the plans, you can vary them – but only if t you have them in the first place.

The shareholders agreement is the most important initial agreement you will have. It is the basis on which your partnership will work and, if necessary, break up. Pre-nuptial agreements may not be popular with their hint of a failed marriage even before the ceremony; a shareholders agreement to determine what happens when the partners fall out is essential if you are not to end up in court sooner or later. Very few partnerships last without a struggle at some stage.

How your shares are to be valued, bought and sold is a key part of the shareholders agreement. Depending on the investment amounts involved it may be necessary for a lawyer to look at your shareholders agreement. Even if you think it is, get someone who knows about start-ups and business to do so as well. Lawyers usually complicate agreements; successful business managers will see what is important.

Businesses succeed almost entirely because of how well people work together. Tomorrow I shall deal with more aspects of how to manage partners in business.

TerrificMentors International helps many people with their start ups. A chat is free. Email john.bittleston@terrificmentors.com.

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We are in a hiatus – a break or missing time, waiting, as it were, for the other shoe to drop. The world’s economy has got into such a state that many feel a sort of decision paralysis. Governments, banks, aspiring democracies, big businesses, small and medium sized businesses, individuals are all showing signs of this. To save or spend? Where to invest? To give generously as the giving season creeps upon us or cut back and hoard a little extra survival fund?

It is, I am told, very like the seashore shortly before a tsunami. The waters recede as the big wave – still out of sight – gathers strength and there is, for a time, an eerie silence reminiscent of the false night caused by an eclipse of the sun. “The birds have stopped singing,” one reader said to me, “and we don’t know whether to sleep or run.” And if ‘run’, where to? For the moment we are still tied to the planet and to the institutions that rule our lives.

So fast is the flow of news normally that we spend all our time keeping up to date. I feel like a maiden aunt I had as a child who drove a huge old motor car. She believed that if you were uncertain as to whether you were going the right way you should drive very fast, the quicker to discover if you were or not. The world is driving very fast but has no idea if it is going the right way, thus demonstrating that it thinks it isn’t.

So action-orientated are we that sitting still makes us feel at best uneasy, at worst guilty. Doing is so much easier than thinking and we have all got into the habit of reacting even when, in our heart of hearts, we know we should be reflecting. Some people do meditate but mostly about themselves or about a distraction to divert their thoughts from the painful daily decisions that they have to make. The concept of meditating about the purpose of life, about the meaning of relationships and about the satisfaction of creating for others has become rare.

The pause we see today won’t last long. No economic decisions can now be right. The best will be “least worst” but they will not be good and they will certainly be short-term, as all decisions in democracies must be, for politicians are generally short-lived in office. Until we know the way the Euro, the austerity programmes, the capitalist sit-ins and the consequential grow-slow future are all going we have a time to reflect.

If we could sit quietly for a while with a friend or two, free from mobile phone, away from all forms of external communication, and ponder on what we truly want for the next twenty years – even if we are old enough to know that we will not see another twenty years – we could, perhaps, bring into view our own and our collective Tree on the other side of the Field. Wealth has proved false, noise has become deafening, consumption threatens collective health and yet we are still devoting our unprecedented resources to these things.

The calm before the storm is a good time to think of what we want once it has passed.

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We teach things the wrong way round, and not just to the young. Our present teaching and training systems begin with theory. It sounds logical. Once you know the theory you can go out and practice it. But you don’t at this stage know how to apply the theory. So you start with the practical, anyway – only it is muddled with bits of theory you have managed to grasp.

This was brought home to me vividly by a friend who wanted to teach his granddaughter to drive. She had no theory, no knowledge of how a car worked and did not, at this stage, know the Highway Code. My friend noticed that the commuter railway station car parks outside London were always deserted on early Sunday mornings. He took his granddaughter to one of them, drove her round twice, asked her to observe what he was doing and then let her drive.

He took an old car but need not have worried. His granddaughter was driving well within an hour.  She did not know how a car worked or the rules of the road but she could drive. He explained the car mechanism to her, looking under the bonnet and pointing out the transmission and how the gears worked. He gave her a short lesson on the mechanics of a car – vital for anyone who is going to drive – and set her to learn the Highway Code. She passed first time.

A similar system is employed by masters with their apprentices. When I learnt carpentry at nine years old my teacher gave me some wood to practice on. I soon discovered the difficulties of handling carpentry tools and shaping hard and soft woods. It was only then that he set about teaching me the theory. I have never forgotten what he taught me.

We learn most things from what we do, not from what we are told to do; from what we experience, either directly or vicariously, not from a theoretical framework. We learn when we enjoy learning, not when we are made to learn. Doing things is always more fun than thinking about them so when the practical comes first it encourages us tremendously. The more we work out ‘why’ for ourselves, the better our understanding.

What is the best link between theory and practice?

Stories have always proved to be a stimulating way to turn what we ought to do into something that someone else has already done. All the great religious leaders recognised the importance of story-telling to make their moral or mystical points. Stories have a ring of practicality about them that can be tailored to suit individual situations.

That is why the ability to perceive the relationship between what is being taught and the stories we all have within us is so important. A good story is a good story at any time; its value increases exponentially when it is a relevant story, too. Tell a good joke cold and it will get a laugh. Tell a good joke in the context of the discussion you are having and it will get a roar.

That ability to perceive relationships is what we call creativity. All training and teaching relies on it to be effective. The stimulus to be creative comes from experimentation, risk, mistakes and courage. Good theoretical structures – but better when they are vigorously practiced.

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As a farmer I understand and respect grass roots. They are our survival and our future. Whether sprouting in northern spring or emerging from tropical monsoon they herald the birth of new life and trigger that hope without which no sentient being would survive. From necessity to beauty they refresh the weary, stimulate the disappointed and enliven the desperate.

I also know what happens to them. They get dropped on from a great height, covered in – well, you supply the word – and trodden into the ground when heavyweights trample their trepid emergence. They are despised if prolific, castigated if sparse, rolled on by lovers, turned over by gravediggers. They survive all this only to wither when the rain ceases or is so heavy that they cannot breathe. Grass Roots do not have the best of existences.

There are a lot of them and they are stirring, making their opinions known, demanding better governance from their superiors and reasons why, not just orders. From Arab Spring to Cathedral Close, voices, sometimes moderate, sometimes violent, are being heard and refusing to shut up. When they are told “It all takes time” they reply “not as long as it will take if you don’t start now”.

The Grass Roots have been led, by those for whom they were persuaded to vote, to expect adequate but not excessive soft rain at the right time, enough to water their needs and a little more but not enough to destroy their lives. But, as always happens, they have thought that just a little extra would make them even happier. As we all know ‘more means worse’.

Dealing with Grass Roots is not a matter of answering them but of changing their expectations. Politicians are full of answers but very short of emotional intelligence or ability to handle themselves and other people. As politicians are also not economically educated – their training is in direct opposition to financial prudence – we are faced with emotionally immature, economic novices grappling with clever and single-minded bankers; they have no chance.

Underestimating the determination of the Grass Roots in this situation is dangerous. A few tanks, some corpses and several hospitals full of wounded will not calm the situation; it will exacerbate it. Repression works when ultimate power is in the hands of the repressor. You cannot repress everyone. Jobless, deprived, robbed, starving people have nothing to lose except their lives. They will sacrifice those to show that repression no longer works, that the Grass Root has finally flourished.

To deal with this we need look no further than Highgrove, Prince Charles’s home in England. Prince Charles is not, of course, allowed to talk to people about politics – no member of the Royal Family is. For all the stumbles he has made in his life, for all the tragedies he has had to endure, for all the material benefits he has had to cope with, Prince Charles has learnt to talk to the Grass Roots, gently, encouragingly. And they respond by growing into beautiful flowers for him. Is there a lesson here?

Grass Roots respond when their leaders are kinder and talk gently to them, perhaps?

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What should you do if you have a reasonable job, in light of the coming financial crisis?

You may think the answer is two words – Keep It. That is certainly the most important thing to achieve but there are many more actions you must consider to ensure that you do and to equip yourself with the information you need to negotiate your next pay increase – or reduction. The signs are that there will be massive lay-offs in the New Year. That could be delayed by printing Euro 3Tr. Even if it is delayed by such feckless irresponsibility the time lag will be short.

Many people are going to be asked to reduce their pay. It is happening already. They will be the people in the middle and at the bottom of the employment ladder. The top people have prepared themselves to take a small cut by pumping up their wages over the last few years – by 49% this year alone. Gestures will be made. They will not impress the protestors who will escalate their demonstrations with increasing violence. In certain parts of the world their will be civil war – Syria and Egypt are already there.

Nearer home you need to know what you are worth. If possible ask a good Executive Searcher; they are the people most switched on to the market. Find out what peers doing comparable jobs are getting and, equally importantly, what their terms and conditions and lengths of contracts are.

Get your personal financial picture clear, even if you don’t like the results. A Terrific Mentors Future Financial Needs Analysis takes about fifteen minutes. You can look at it and complete it free but if you want to discuss it I charge you a little for the time. It will not solve problems but it highlights needs and that puts you in a stronger position to negotiate. You may be doing a lot of that in the near future so if you are not clear how to, get busy and learn.

Organise yourself to work more from home, even if there is ‘no question’ of your losing your job. I have helped several people save their jobs by moving some of the workload away from the office. Home working is widely accepted for many people now; it requires special disciplines and some disruption to the household.  Rather that than lose your job. If you don’t know how to reorganise your work around the home, get busy and learn now.

Help your employer reduce his costs and he will be better disposed to keep you in a job.

Examine your job to see what real financial contribution it makes to the business. Those who bring in the cash are better placed to survive than the admin team. That doesn’t mean that admin is not important, just that it is more dispensable. If you work hard, look at how productive your hard work is. Many people are working hard at working hard and that butters no parsnips.

Get your contact lists up to date. They are in a mess, more than likely. Use some of your spare time to bring them into a usable state. He who moves fast when the axe falls loses fewest limbs. Haven’t looked for a job for some time? The labour market at all levels is so different today from three years ago that you need to understand how to present yourself well. ‘HR record’-type CV’s don’t attract employers anymore than sloppy, thoughtless interviews. As for CV mailings, forget it. Push $100 dollar notes down the drain instead, it will have more impact.

There are many more things you can do to prepare for the upcoming financial tsunami. Preparing won’t deflect it – but it may keep you afloat.

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A friend followed the Daily Paradox on ‘Money isn’t everything, my child’ (18 Nov 2011) with a question:

‘The young these days watch us closely and ask “if money is not everything then why are we so stingy, even we who say money is not everything”’. I promised him a view.

First, I assume the reference is to appalling worldwide poverty and why rich countries and people do not provide more money to alleviate it. The young in developed countries have had mixed experience of ‘stinginess’ ranging from the equivalent of child labour to over-indulgence. The gap between the rich and the poor has widened dramatically in the last thirty years both internationally and locally. If the young perceive that as shameful, I agree.

There are three basic reasons for ‘stinginess’. One is prudence. Those who have worked and saved in order to avoid others having to subsidise their medical care in old age are trying to stand on their own feet – a wholly worthy aim. They have learnt that what seems a lot of money when you are young may well be quite a modest amount when you are old, especially now we all live much longer.

So prudent people save a bit more than they might have originally intended in order to deal with inflation. The fact that they are currently being robbed blind by the shenanigans of the financial world will lead some to abandon the attempt and others to double their efforts. Either way the victims will be the worldwide poor because less money will be available to help them. The poor always are the victims.

Prudence is not to be sneezed at. If in the last thirty years all governments – and that means voters, too – had acted prudently the world would not be teetering on the brink of the worst recession, coupled with the worst inflation, which it has ever seen. It is too late to start teaching prudence to avert the forthcoming disaster. The financial collapse itself, caused by indiscriminate money printing, will, if we survive it with anything remotely resembling civilisation intact, teach personal prudence, albeit in a very painful way.

The second reason for apparent ‘stinginess’ is the expectations we have all acquired for a better life. This is seen as more possessions and more consumption. I watched a television programme where a single mother of five children, wholly supported by the state, complained – without taking the cigarette out of her mouth – that the poverty allowance only permitted her family to have one holiday a year whereas most people got two. I do not want to see the poor deprived of a decent life but the state cannot pay for everyone to enjoy the fruits of labour they have not performed. The world as a whole is living way beyond its means,

Thirdly, there is much evidence that generosity often leads to lost funds. After the tsunami of December 2004 many millions of people gave money to help with the relief. Eight years later much of that money, already significantly devalued, has still not reached the intended victims. This is usual. Corruption, delay, bureaucracy all contribute to poor distribution of funds.

Stingy? I do not think the average person is stingy. I think they are thwarted.

I came across this article in Forbes yesterday about “early career flameouts” in seemingly successful women around the age of 30.

Many people – both men and women – come to me as a Mentor because they are exhausted, find life pointless and are financially committed enough not to be able to get off the roundabout. Their objectives have been almost entirely financial and competitive. They have failed to define their “Tree on the other side of the Field” in the correct way. A redirection of their aims always changes their satisfaction with life even though it removes none of the financial needs or personal imperatives. It is not rocket science, a magic potion or deep analysis. It is an understanding of what makes people – themselves and others – fulfilled. Easily explained, it requires discipline to achieve.

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You don’t need telling that money isn’t everything. You already know that the good things in life are free. You are probably enjoying them right now as you sip your cup of coffee, read your newspaper or scan your computer screen and contemplate the pleasures you hope to enjoy over the weekend. You also know that without money life will be extremely painful, uncomfortable and sometimes boring. If you are not involved in the financial world you will have a slight feeling that all is not well but ‘they’ will surely sort it out – crises come and crises go, life goes on forever.

Several people whose views I respect and who are not given to scare-mongering are now truly worried about the Euro situation. In previous articles I have tried to explain the bones of the subject simply.

When a recession looms you may grow your way out of it (the Perpetual Growth Method) or you may reduce your spending (the Austerity Method). The former depends on spending so cannot work if the latter is happening. Nobody wants the Austerity Method – and they make that very clear with protests that have yet to turn a lot uglier. Solution: print more money, spread it around and everyone will spend more – and forget the inevitable inflation that will follow. What happens if the new money is saved (the Prudent Method) and not spent? Then you have both recession and inflation – ‘recflation’, if you like. That is where Europe and the world is heading.

My worry is that the children whose lives – probably for the next fifteen or twenty years – will be dominated by this are not being equipped either to understand it or to handle their own money sensibly when they have some. How many parents give their children a real financial education? Which school curriculum includes a practical training for financial competence? I notice that even University students have little sense of money – either personal or international.

Education is more than training for life, it is about how to make your life and the lives of those around you fulfilled. But just as you need to learn the alphabet and how to count so you need to learn the rudiments of finance. When my five children were growing up I started a small retail business partly so that they could work in the shops at the weekends and during school holidays. They all told me it was an important part of their education to see customers examining goods, looking in their purses and wallets to see if they could afford to buy and hearing the tinkle of the cash till bell.

Please can we teach the young what money is, what it is for and how is basically works?

If we don’t, we shall give yet another generation the grief we are in the processing of giving our children today.