As a manager, it’s always hard to know when it’s the right time to fire someone — and it’s especially hard to determine how to fire someone.
I’m often asked about this by startup founders who are struggling with an underperforming employee. Because there’s no one-size-fits-all answer, I usually ask a lot of questions before sharing my opinion.
1) What exactly is the problem? Is it because they are not hitting deadlines or sales targets? How do they work with the founder, manager and other team members?
2) Have you communicated your concerns with them? If so, how? In person? Slack/email/text? Phone? How long ago was that?
3) When you did communicate with them, what was their response? Did they acknowledge their shortcomings and agree with you on your suggestions for how they could improve? Or did they push back?
4) Have you outlined clear goals for them from the beginning? Have you given them feedback along the way?
5) When was the last time you discussed these issues with them?
Quite often, the answers to the questions above warrant a deeper discussion about management style and communication. As I mentioned in an earlier post, it is your responsibility to be clear about what you expect from your team, whether it’s sales targets, client leads, deadlines met, or working with colleagues. It should never be a surprise when you finally have “the talk.”
As Jerry Jao of Retention Science says, “if you’re thinking of letting someone go, you probably should have done it 4–6 weeks ago.” From a startup perspective, he’s absolutely right. If your company is at a very early stage, you simply cannot afford the time to procrastinate. If someone is not performing, and you’ve given them clear guidelines, you do not have time (or money) to waste.
When it comes time to let them go, there are some guidelines to follow: Always in person, always reasons given, always paperwork done beforehand, always professional. Be kind. No exceptions.
Large, mature organizations often have internal training programs and heavily resourced HR divisions which are devoted to retaining employees – even those who fall into the “needs improvement” category on their performance reviews. But you, as an early stage founder, have an obligation to yourself, your company, your investors, and your other teammates to make firing decisions clearly and quickly.
Coming from a large organization prior to becoming a founder myself, I learned this the hard way and it was a shortcoming for me as a leader of a startup. I spent far too long trying to help a few early employees be better, to see our vision, or to fit in better with our company culture. I wasted precious time by keeping underperforming employees around, in hope that they would improve.
When hiring into a startup environment, it is most important to select team members who fully subscribe to your vision, your mission, and to the hard work and long hours necessary to build the business. In addition, they need to bring a skill set that either you don’t yet have, or one that you need more of. Before you hire them, get to know their background, their attitude toward work, why they left their previous job — and spend time checking references. Google and LinkedIn don’t count. Talk to previous employers and/or colleagues.
For the record, it has been my experience that hiring executives from large companies into startup roles usually doesn’t work. With very few exceptions, the mindset is simply too different. Even executives who say they want to be entrepreneurial or that they are excited about being in a startup environment usually don’t have the hustle that you need and expect. The corporate world and the startup world are simply too different. Look to hire people with corporate experience once you’ve proven your model, you’re profitable, and you already have a management structure in place.
I’ve been asked “what does it look like to my investors if I’m letting someone go shortly after I’ve hired them?” Answer: It just doesn’t matter. If you know they are not the right fit, and you clearly communicated all of the above — then do it, learn from it, and move on.