11 Aug When to Let Someone Go
Arguably one of the most difficult decisions any entrepreneur or business owner faces is when to let an employee go. I am not talking about the obvious decision when a staff member does something so bad that you have no other choice but to let them go. I am talking about the loyal or friendly employee who has helped you build your business but is no longer contributing.
I debated on whether I should write on this topic, because let’s be honest, the subject is uncomfortable at best and insensitive at worst. We are talking about people who have families that depend on their salaries. How could I even consider letting this person go? And if I must let them go, when is the best time?
Let me start by addressing who is responsible for making sure your staff is growing. This is a team effort that starts with you as the leader. It is your job to spend the time and effort to educate and grow your staff. As your business grows, the product or service you offer evolves. That means you have to make sure your staff understands the direction of the company. This must be overcommunicated. As leaders we need to remind ourselves that our staff are often not in the room where decisions are made. So, it is our job to communicate and communicate again on how the company is growing.
But the employee also bares some responsibility. If you are communicating the changes in a way where most of your staff understand the direction, then you cannot be responsible for an individual who refuses to take the time to learn and adapt.
That might sound like harsh words, but there is truth to the saying that an organization is only as strong as its weakest member.
That might sound like harsh words, but there is truth to the saying that an organization is only as strong as its weakest member. As the CEO or leader in your business, you are responsible for your entire team, not just one individual. If you are holding on to one person for fear of being insensitive to their needs, you are communicating to the rest of your staff that the needs of one outweigh the needs of the group. Put another way, when you say “yes” to someone, you are often saying “no” to someone else.
I find in most cases I am the last one in the organization to conclude that an individual needs to go. Their colleagues are the ones left picking up the slack when goals are not getting accomplished.
When do you let someone go and what are best practices? I don’t pretend to be an HR expert, but here are some practical tips that I have learned in 20+ years of management.
1) There is never a good time to give someone bad news. You can always think of some reason to delay what needs to be done.
2) Give the news at the beginning of the week. Don’t leave a former staff member with the weekend to do nothing but imagine the worst. Let them go in the beginning of the week when they can start searching for their next job.
3) If you can afford to be generous, be generous. Give them a severance to help them transition to their new role. Most American’s live paycheck to paycheck.
Budget cuts are the most challenging layoffs. I have been there before, and letting someone go because of budget cuts is hard. In this case the individual did nothing wrong. But you must go back to your responsibility for the entire organization, not just the individual. Let me call out my fellow CEOs on this topic. Before you start cutting staff for budget purposes, have you looked at your own salary? If you are a business owner no doubt you pay yourself last. But if you are a hired CEO, you are most likely the highest paid person on the payroll.
Finally, there is the topic of eliminating a position in the company that is no longer needed, which is equally as difficult as budget cuts. This happens when you realize your company has evolved to a point there is one or more positions in your company that are no longer necessary. My advice is to try to use the talent you have in other roles if they are available. But sometimes the skill set of the employee that was needed at one stage of your business is no longer needed today. So again, think of your entire team and be generous.
I talk a lot about putting people over profits, so this article might seem counter to my message. However, the people include your entire staff and your clients. It’s one of the many things that makes being a leader so hard.
Scott Miller is the CEO of Centerpost Media and host of the Create, Build and Manage Radio Show and Podcast. You can find Scott on Facebook, Instagram and Twitter via “@scottmillerceo.” Centerpost Media is a marketing agency with a vision to help every business they encounter with their media needs by providing outstanding quality, service and value. Centerpost Media is the parent company to BizTV, BizTalkRadio, BizTalkPodcasts and Bizvod.