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Let's Do Some Firing | The HBS Blog |
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Let's Do Some Firing | The HBS Blog |


By Matt Cholerton Wednesday, January 18, 2012

Do you have an employee that just does not contribute? Do you ever wonder what the heck is this person doing here? Do you get negative feedback from employees or customers? You muse, ‘they have only been there a few months’ so we should give ‘em a shot. Or you think you can’t get rid of them because ‘they’ve been here forever’!?

Well, it’s time. Go on. Don’t wait to fire any longer. Just. Do. It.

But...but...wait you say? You have a small team and you worry about the impact on morale? Well, the negative impact on morale builds everyday this under performer is still at the company. Imagine how hard it is to give it your all, when you the person you sit next to someone that sucks. There is very little that is more demotivating. Disruptive, negative, or under-performing employees set you back way more than just their direct lack of performance.  Poor performers are infectious! In the way they handle projects, talk about clients and the direction of the company, they can contaminate your momentum. Poor performers will stick around as long as they can. On the other hand, excellent performers will only stick around so long when they see you value them and don’t tolerate and foster less.

Falling behind in projects, damaging vendor relationships, and losing information are often fears much more than they are actual issues. You might be surprised to find no gaps, or an improvement, after an under-performer departs.

But...but...but you worry about the legal repercussions - “California law makes it so hard... “ or “We don’t have the right documentation in place.”  Blah blah.  As an HR person I know I’m not supposed to say that, but you are trying to run a business! And this is killing you. If you are a fair and non-discriminatory employer, acting according to the true business needs of your organization, you shouldn’t have anything to worry about*.

*A quick disclaimer: I am not a lawyer. I will not take responsibility for your employment decisions and I know every time you have to call a lawyer its prohibitively expensive. And yes, sometimes it is complicated. Everything you do as an employer involves some risk.

Let’s turn to Exhibit A: Jack Welch made a career out of firing the lowest performing 10% annually.  This was a formal system at GE, forcing a differentiation between the 20% of top performers, the 70% of adequate or average performers, and the 10% of under performers. The top tier was rewarded disproportionately. They were given money and generally lavished. The bottom 10% in Welch’s system had to go - no ‘if’s’, ‘ands’ or ‘buts.’  It was controversial, but it forced managers to make hard decisions, that they most likely would have never gotten around to otherwise. It set the tone of performance, expectations, and values. Some credit this system with a 28-fold increase in earnings and a 5 times revenue at General Electric in the 20 years of Jack Welch’s tenure.

Every company has its own culture. Most companies would say part of their culture includes a team of exceptional performers and investing in their team. Unfortunately, most companies, for all kinds of reasons, also allow under-performers, bad-apples, and legacy function to exist for way too long. This is a trait you need to break. Not only are relaying on folks that only do a sub-par job for you, but more importantly it’s a culture that demotivates your top performers.

Rip off that band-aid! You might find it the best thing you ever did.

 

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