July 2005
WHEN DRIVING THE BUS IS NO FUN
By Tony Mulkern
Jim Collins, in his 2001 bestseller Good to Great, introduced into everyday business speech the phrase, "Get the right people on the bus and the wrong people off." It refers to a principle he says characterizes CEOs of great companies: they hire the best talent they can find for top positions, and they fire those who are ill suited for their jobs.
While some might find this pithy phrase a tad ruthless, the brutal truth is that one of the major jobs of any CEO is assembling a team that can win, outpace the competition, grow the company, however you care to state it. We all know that any NFL or NBA team owner who does not aggressively pursue talent and cut poor performers will not make it into the playoffs. It is no different in other businesses. The same thing applies even to not for profits-some great church leaders I have known are just as decisive when it comes to separating the wheat from the chaff.
The problem for entrepreneurs arises when the person who needs to be cut is one who helped establish the firm in its early days. He or she may have been a great performer then, was given a senior position or title, but now seems not to have kept up. This person and the CEO were virtual partners at one time, may have spent 18 hours a day together for years, and even the thought of letting such a person go feels like an act of betrayal. This feeling is compounded if the person in question also happens to be a family member. This is not to mention the legal issues of how to protect the firm in the event of an involuntary termination.
Sometimes the question is put this way by the CEO: "How can I feel good about getting rid of a person who.?" The answer is that you probably won't and never should feel good about firing anyone. You can, however, feel confident when you have done your homework and know it is the best course of action.
Doing your homework involves three elements: a) defining "right"; b) defining "wrong"; and c) defining "off the bus," which is not as simple as it might appear. None of this is easy, and gut instinct by itself is unreliable. We all have experiences of poor hiring choices based on intuition; bad firing choices can happen the same way.
The right person is someone who meets or will meet the output or results requirements of the job. These requirements need to be specified carefully and as much as possible quantified. In the early days of a business, such definitions and metrics may have been unnecessary. Things were simpler, the people involved were fewer; and so everyone just understood what needed to be done. It is the increased need for but absence of clear statements of authority, responsibility, and authority that lead some entrepreneurs to conclude that people formerly seen as key no longer "get it."
The wrong person is someone who is unable or unwilling to meet the output or results requirements of the job. Until those requirements are clarified and the shortfalls are pointed out, you will never know whether the person who is falling short is unable or unmotivated, or is simply in need of help. So a second part of the "homework" is confirming your impression of unsatisfactory performance and having conversations with the person in question about the perceived performance gap-in specific behavioral and measurable terms-and what can be done to close it.
At this point, many options may be available. Many dedicated employees willingly neglect their own professional development in the process of putting in the long hours needed to help the firm grow. Perhaps executive skills were never an issue before, but critical lack of them now can be corrected with executive education and training. Maybe they have fallen behind technically, but can go back to school to catch up. It is not that people get promoted to their highest level of incompetence; it is that they sometimes get promoted without receiving the support and resources they need to be successful. It truly is unfair to replace such a person with someone more "fresh" without first making these efforts.
Next, the CEO facing a situation of unsatisfactory performance needs to define "off the bus." The first meaning that comes to mind-out of the company-is not the only possibility. It might mean assigning the person to a different set of responsibilities. As the company grows in size and complexity, broad functions need to be divided into specialties, each extremely demanding in itself. The person apparently failing in what has become too big a job may thrive in a subset of that job, which is much more like the function he or she successfully handled in the firm's early days. This calls for creative organizational redesign and skillful deployment of the company's human resources-something very different from the notion of throwing someone out.
When performance gaps are discussed in this way, straightforwardly but with sensitivity to the feelings involved, underperformers tend to do one of two things. They either take the necessary steps to improve, or they quit. No one prefers to go to work everyday under a cloud of disappointment from the boss.
If these solutions have been applied and the poor performance remains, then as CEO you can more confidently exercise your final option. One successful entrepreneur I know made his father a part of his team but later fired him because the latter refused to conform to his son's requirements. Though this was painful, the younger man now had his own family's future to worry about, not to mention his employees and customers. In another case, a company's founder had promoted his son to President but was later forced to come out of retirement-and effectively fire his son-to rescue the company before his heir bankrupted it.
Two final caveats. The CEO/founder of the growing firm may have also neglected his or her own executive development. Be sure not to confuse anxiety about your own skills, and need for further executive development, with anxiety about the skills of others. Second, as the firm's success begins to attract attention, many opportunists will approach the firm with the pitch that they are exactly the seasoned executive talent that the growing firm needs to take it to "the next level." Separating the hype from the authentic talent seems to require at times superhuman insight. You never know for sure until they are on board-and too often they prove disappointing.
This means that the loyalty and proven dedication of those who have played a key role in the firm's establishment and early success are truly irreplaceable. Unfortunately, sometimes these qualities are just not enough, and such problems only get worse if they are not faced squarely and timely. But before deciding to get anyone "off the bus," be sure to do your homework.
Copyright, Mulkern Associates 2005 |
