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The top six ways you failed by firing your employee, even if they were a bad employee. July 18, 2013

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Fired


  1.        

    1. Firing employees is a failure of management.


As you already know if you are a regular reader of these pages, I have spent much of my career as an entrepreneur. I have hired and fired hundreds of people during the course of my career; There was no other way I would have been able to build my businesses over the years without harnessing the great ideas and hard efforts of others. I have a saying that I believe sums up much of my experiences in this area: “You will never have a great company if you never ever fire anyone”.

What I meant by that back then, and what I mean by it now, is that you must periodically “cull the herd” for really chronically under-performing employees, sometimes people outright steal from the company, sometimes you get a bad apple involved in some nasty business outside work, and believe me, I have dealt with every kind of drinking and drug problem employee that exists. So sometimes, you have to let people go. Sometimes you run out of money for payroll. Whatever the case may be, and whatever type of employee you are letting go, you need to know how to do it. The mechanics of the procedures of firing employees, and the legalities of such, I will leave to an upcoming article, but I want to talk about the effects on your organization that the force reduction(s) will predicate.

Letting an employee go goes straight to the bottom line: as a net improvement, an immediate positive effect. You save all the money you had “committed” to paying out to that employee, plus all of their benefits. That is all someone else’s problem now. It is heady stuff, especially for an entrepreneur. Some people and companies, in all frankness, become addicted to layoffs. They reclaim badly needed cash into the company coffers immediately, they get easier and easier the more of them you do, and until the advent of social media very recently, it was really easy to conceal a single or even multiple rounds of layoffs or firings. So I understand the temptation, and I will be the first to tell you lots of people will come up to you with comforting words or encouragement after you can employees. Your investors may even applaud you, and employee reactions in the short term can and do typically range from indifference through denial, to happiness at the forced departure of a rival.

Over the course of the years, having watched the effect of firings and layoffs not only that I had myself executed, but also the effects they have had at companies at which I have worked. As an entrepreneur over the years I began to realize that in actuality, it was I whom had failed when I fired someone. I was a leader, a manager, and I had failed to perform in my job to the highest level I could.

How often are you tempted to fire an employee? Do you think you can improve efficiency by removing a problem? Can you demonstrate increased earnings by reducing headcount? How about letting somebody go to send a message? Firing employees does send a message; in fact, it sends several.

When you choose to terminate an employee–even a really, really bad one–you are sending several possible messages to your other employees, your peers, and your superiors. Most of those messages are bad. Some are worse than you realize.


2. So it looks like you hired the wrong person, huh?


While hiring the perfect candidate is difficult, hiring a good candidate certainly is doable. There are tools available to help a manager identify all of the skills and competencies required in an open position, and include interview questions for helping to weed out candidates that have the right qualifications on paper but cannot articulate the proper experience. Because these tools do exist, the expectation is that a hiring manager will use them and anything else at their disposal to hire a good candidate. People generally can spot a bad hire right away, and that always reflects poorly on the manager. Again, a long string of good hires can erase the stain of a bad one, but if your first hire is bad, it takes a lot to erase that initial impression.


 3. You’ve wasted an obscene amount of office time and productivity, and in business that is a cardinal sin.


 You hired this person for a reason. You had to get budget approved for the headcount, and that wasn’t easy. You had to demonstrate a clear business need that could not be fulfilled without acquiring additional staff. You had to jump through a lot of hoops and–chances are–had to suffer through a period of strained capacity and unreachable goals before filling the role. And now you’re firing the person you hired.

So what happened? Did you misrepresent your needs for the headcount and you actually were able to get by without a competent person in the role? Did you not understand the requirements for the position you fought so hard to open, and hired somebody that could not perform as needed? Neither is good.


 4. You’ve failed as a leader in this instance, and you apparently may lack the ability or knowledge of how to train and develop your employees.


As a manager, you have several responsibilities. You are responsible for achieving the goals set for your team–and those goals are probably unreasonable and set by people who do not understand the constraints of your resources or the capacity of your team. But you have to hit those goals, and if you are in a publicly traded company, you need to exceed those goals. Every quarter. No matter what. So you tend to focus strictly on achieving those goals and anything that diverts attention from them is a waste of time and effort that could be going toward achieving your targets.

But as a manager, you have several responsibilities; not just one. Whether or not it ever is brought up in a one-on-one with your boss, you are responsible for improving the skills and competencies of your team. You are responsible for their professional development. You can do this through regular one-on-one meetings in which you set individual goals designed to progress their skills, as well as encouraging further study in areas that will improve their proficiency in core and functional competencies.

The benefits of coaching your staff–in addition to managing their day-to-day progress against task completion–is that your team enhances its productivity and capabilities over time, becoming better and more efficient than when you got there. Noticeably better and more efficient. And that is good for you.

Unfortunately, the inverse of this is true as well. If you allow your staff to stagnate–to at best maintain their proficiency levels rather than grow–then you will be regarded as a caretaker rather than a leader. If the people who work for you do not enhance their careers within the organization, then neither will you.


 5. Leaders solve problems, regardless of the circumstances, and you didn’t solve the problem.


Turning a bad employee into a productive one is difficult and everybody knows it. Everybody also knows the easy way out. If you choose to eliminate an employee rather than identify, address, and resolve the issue that is damaging their productivity, then you are taking the easy way out. And nobody respects the easy way.

I used to say “Anybody can spend money: that part of owning a business is easy”. You could just as easily say that about firing someone: if you are good at it, or bad it, firing someone is something that anybody can do. It’s the easy way out.

Further, while firing an employee is the easy way out, back-filling that position is hard. Everybody knows that, too, and they imagine you know it as well. So why would you put yourself, your team, and your organization in the position of fixing the problem (i.e. dealing with a loss in capacity while spending resources on back filling the position) when you failed to repair the problem with the employee you had?

If you own the company or start-up, there will come a time when you may kick yourself. I used to get upset with myself for hiring the person in the first place only to have to lay them off because I didn’t know how to hire well and / or I failed to turn my own hire around.  If you are a manager in an organization or company, there may be a time now or in the future where your superiors come to regret your actions, with negative consequences for you.

Managing an ineffective employee through whatever blocker is causing the employee to fail is extremely difficult for the manager. Running at a reduced headcount while back filling the position of an employee who was terminated is hard on everybody. In this way, firing the employee rather than taking the time and effort to fix the issue demonstrates a willingness to shift responsibility away from oneself and onto others. Again, this is a black mark against the leadership capabilities of the manager and will take time and effort to repair.


 6. Leaders lead, and they don’t ever act in a manner that would jeopardize their own hold on their team or undermine their own ability to lead their team, and you just did both. You may even “lose” your entire remaining team now.


 

When you fire an employee, you are sending a message to your staff that you are not there to support them. Even if the employee actually is terrible–and you are not seeing insurmountable problems where there aren’t any–your staff just saw one of their peers let go. The employee’s peers just subconsciously identified with the terminated employee (i.e.–”That could just as easily have been me”) and will be walking on eggshells around you until they are convinced of their security. If you are great at your job, you may recover, but you effectively told your direct reports they are not safe.

If one of your other remaining team members gets a new job, you might have to throw some kind of pizza or cake party for the departing employee, and those types of parties are really a drag on your team’s morale. You have also increased the value of the remaining staff members, and you might have to ask them to work harder to pick up the slack of the departed. All of this stuff is the kind of activity a good manager works so hard to avoid. You may also have to give a “rah-rah” speech to let the troops know what just happened, they should be excited about coming to work tomorrow, it won’t affect them, we’re better off now without that person / people, this was a “talent upgrade”, we’re hiring, etc., etc.

In the short term, your remaining employees will work harder, show up on time, they are all scared for their jobs, they will brown-nose you, and suck up to you , and everything will be roses and honey – for about a month, sometimes two, three at the outside. Many of your employees will be looking for a new job, because no matter what you said, they don’t trust you now. And after I went to work in more corporate environments, and wasn’t an entrepreneur anymore, I began to notice something else in relation to managers who fire a lot of people, a corollary quote to go with my original devised during my entrepreneurial days: “You can fire a few employees and your superiors may think you can ‘do what needs to be done’…but after you fire several people, they begin to look at you”.



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About the author.

I’m Paul Seibert, Editor of Boston’s Hub Tech Insider, a Boston focused technology blog. You can connect with me on LinkedIn, follow me on Twitter, even friend me on Facebook if you’re cool. I own and am trying to sell a dual-zoned, residential & commercial Office Building in Natick, MA. I have a background in entrepreneurship, ecommerce, telecommunications and software development, I’m a PMO Director, I’m a serial entrepreneur and the co-founder of several ecommerce and web-based companies, the latest of which is Tshirtnow.net.

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