Forging alliances and making strategic partnerships is an important decision, But basing a partnership solely on the fact that you get along with another person is bad business.

Good personal chemistry, whether you were friends before the business venture or partnership arose, can cause a sort of blindness. Benjamin Gomes-Casseres, an expert in alliance strategy and a professor at the International Business School of Brandeis University, writes in Harvard Business Review about the good chemistry trap.

"Of course, good personal rapport can help you see opportunities in working together and can get a complex deal done. And in long-term partnerships, it is essential to managing the inevitable unforeseen circumstances. But, don't rely on chemistry--particularly if that chemistry is between only a few of the principals involved--in deciding and managing a major deal," Gomes-Casseres writes in HBR. "Even trust is an unreliable foundation when it is held by individuals and not supported by broader organizational interests."

When doing business with a friend, it is easy to make assumptions--you assume the friend won't do anything to hurt you or put you in a compromising position. It is easy to rely on trust. While trust is necessary between partners, trust alone will not hold up in certain circumstances.

Below are five tips for ensuring you go beyond good chemistry and make sound business decisions, while forging mutually beneficial partnerships: 

1. Ask 'disloyal' questions.

Gomes-Casseres says you need to ask those questions that seem "disloyal" to a friend. What is this CEO's track record with past partners? What happens if this CEO resigns? Are there people in the company who would want to dissolve the partnership?

"This kind of analysis is an antidote to blind-love syndrome. Acting in this way is not disloyal at all. It ensures that you will have a good understanding of your partner, which in turn enables you to negotiate and manage a more productive combination. Ultimately, serious business partners will respect your serious due diligence work. And you should expect it of them."

2. Evaluate the company's abilities.

You would assume your friend's company can do what she says it can, but that's a dangerous assumption. What if the friend is holding something back?

"Evaluate carefully the partner's true resources and capabilities. Your evaluation may include external analysis by independent parties. Legal clauses seldom protect against a partner simply not having what you thought they did," Gomes-Casseres writes.

3. Explore your options.

Do not let blind love prevent you from exploring alternative partners. Your friend might not like it, but if there is a better strategic partnership out there you need to consider it.

"The lack of a serious evaluation of alternatives is a sure sign of a poor partner search," he writes.

4. Protect your company.

A sound alliance isn't held up by friendship, it's held up by a legal contract, an agreement where everything is spelled out.

"Protect yourself through the legal terms of the deal by building in concrete mechanisms for joint governance. A personal touch, good intentions, and enthusiastic teams are never enough," he writes. "These need to be supported by a clear division of rights and duties, effective communication channels, and good escalation procedures, just in case."

5. Go beyond trust.

You need to set good management practices and rules of the relationship.

"By itself, trust is not reliable, and too much trust can be counterproductive. Your trusted personal counterpart may leave, or circumstances may change to make commitments costly. But you can manage the relationship to ensure good communication and encourage mutual forbearance and reciprocity," he writes.

Published on: Oct 7, 2015