It’s Not the People You Fire – It’s the Ones that You Don’t Who Will Make Your Life Miserable
There’s no more challenging job in a young company than being the person who has to let people go. Everyone else gets to talk about what a tight-knit, stick together group the company is (just like a “family” of friends) and all that other touchy-feely stuff, but you’re the one who has to deliver the bad news over and over again. And it’s true whether you’re the CEO or the head of sales or the HR manager – it doesn’t really matter – it’s a tough job for anyone. If you were unpopular in high school, you’re already one step ahead of the game. It’s not easy or always popular to be the boss, but then good leadership isn’t a popularity contest. It’s a given that you can’t please any of the people all the time.
The truth is that your company’s only as good as your worst employee and the best-run businesses are always looking to either retrain and upgrade or replace the lowest performing employees. Sometimes it’s a breeze. We try to immediately fire any employee who doesn’t try or doesn’t care. These are cardinal sins in a start-up and there’s no question that these people need to go – they’re always the easiest decisions. And then the job gets harder and harder.
The next tier of troublesome employees is those who try hard, but just cannot do the job. You can be totally sincere and have the best of intentions, but still be incapable (or no longer capable) of doing the job that needs to get done. There are good people who are perfectly able to do a job poorly for a very long time before anyone has the time, interest, or guts to ask the hard questions about results rather than effort. These people need to go too, but you need to be as fair and firm with them as you can. And do them a real favor – tell them the truth.
Then there are the employees who are basically hard-working and dedicated, but who (for better or worse) can’t fit into or model the corporate culture and behaviors. Every business that I’ve been involved with has ultimately been about hard work mixed in with a healthy dose of paranoia. We had lots of ways to reflect this ethic and plenty of signs all over the place. “Hard work conquers everything.” “Effort can trump ability.” “We may not outsmart them, but we’ll outwork them every time.” “Obstacles are those frightful little things you see when you take your eyes off the goal.” “Just because you're paranoid doesn't mean that someone's not out to get you.” And so on and so forth. And almost everyone we hired got the message and drank the Kool-Aid. Even the people who just wanted a “job” and not a career or to join a sacred crusade pretty much still worked their butts off.
But every so often, we’d hire someone who was just too healthy and well-adjusted to succeed among our tribe of crazies. We used to say that a relaxed man is not necessarily a better man. In one business, our internal motto was “let our sickness work for you”. It turned out that it was important to let the other people see you sweat – not just the big deals – but the smallest details so they knew you cared. If you weren’t just a little bit crazy about the work and the business, you were slightly suspect or worse.
I remember one special case where after we let someone go he wrote me a long letter and asked for a more complete explanation of why he didn’t succeed with us. I decided to reply and ultimately what I ended up telling him is something that it’s worth always keeping in mind when you sign up to be an entrepreneur. I wrote:
I’m sorry that complex issues like an individual’s performance and work attitude get reduced to unfortunate shorthand phrases like “not hungry enough”, “didn’t want it”, etc. in conversations with others who want to know “what happened?”. We all know that work and relationships are far more complicated than a few pithy phrases. And we also know that, in their own mind, almost everyone wants to do a good job that they and others can be proud of. But here’s the rub. Only a select few individuals are crazy enough (as we pretty much all are here) to subject themselves to the constant stress and heartache associated with starting and building new businesses. Our company is a very fast track run by a bunch of workaholic perfectionists. We all believe that that’s what it takes to win against pretty fierce odds. And this is simply not the right place for everyone – especially people who want to have a family, outside interests and a normal life. I think it’s very likely that you’re simply too nice and too well-adjusted to work with the crazies around here and that’s shame on us – not you. But it’s the way things are. We wish you all the best.
Ultimately, all of these situations come down to the basic choice – you can make one person miserable for a period of time when they lose their job, or you can end up with a crappy company where everyone’s miserable because you don’t have the guts to do the right things for the business. And once you start to carry people along who aren’t performing, you take a tremendous double hit – you pay the price for the poor performer’s activities, but that’s nothing compared to the real harm. As soon as you fail to consistently fire non-performers, you start to lose your best people and that’s what kills the company.
To do this right, you have to build a differentiated system from the start that provides different levels of rewards, acknowledgments and compensation for different people throughout the business. And you need to move quickly and regularly to identify and remove the bad apples before they spoil the whole place.
PP: “You Get What You Work for, Not What You Wish for”
