Many small business owners hire too soon and fire too late. Meaning, they don’t do a great job of delegating (hire someone to do what I don’t have to) and once that person is in the fold, they wait too long to get rid of them. So the question, when to fire an employee?

One of my favorite stories about this came from Cameron Herold (of 1-800-Got-Junk fame). He spoke of a time when he fired someone he had hesitated letting go. The employee actually started crying out of relief. He had known for six months that he was going to be fired and had been waiting for the axe to fall. He had felt ostracized by the team and of course hadn’t been very productive. Cameron spoke of his crying with the employee, apologizing for not doing it sooner and for essentially wasting his time.

There are two reasons you fire somebody. They’re either on the wrong bus, or you don’t have a seat on the bus for them.

Wrong Bus

Tim Collins coined the analogy of a business being a bus headed in a particular direction (hopefully not in circles). Sometimes employees don’t want to go where the bus/company is going. There are an infinite number of reasons both professional and personal as to why there isn’t a match, but the important thing is to get them off the bus ASAP. Once they realize the destination, they realize that they’re headed in the wrong direction. This will result in anything from lost interest to outright sabotage.

Unspoken in this is that everyone knows where the bus is going. It is critical that the owner and/or management communicate consistently and frequently the business’ destination through its mission, values and employee reviews. If it is not clear where the bus is headed, employees will fill the void, usually with fear. In which case, it doesn’t matter if they’re on the right bus!

No Seat

So there are two reason there isn’t a seat on the bus. First is that all the seats are full. In other words, you don’t need any more employees. I’ve seen many businesses keep employees too long in hopes of a turnaround or future growth, maybe even create a position for a long term employee. Be honest with yourself with the business and market situation. If there aren’t going to be seats anytime soon, make the tough choice now. Business owners tend to be optimistic, which is great but be realistic with your costs.

The second reason there is no seat on the bus is because the person doesn’t fit. In other words, they don’t have the skills necessary to do the work. Hope is not a strategy. If somebody isn’t “getting it” they probably aren’t going to. Many business owners get stuck in “the devil I know versus the devil I don’t” syndrome. Trust me, there’s always someone better. You don’t have to settle! It will take work to find them, and probably cost you more money upfront, but in the end, it will be worth it. And don’t wait until you’ve found the replacement. That’s a pacifier that leads to inaction. Empty the seat, and you will be motivated to fill it!

We Are Here To Help

One of the great books I’ve read on the subject is Necessary Endingscbrim@coregroupus.com and let me know what you think of the book. Also, click here for our free report on why you must track salaried employees’ time. Let us help you with any of you bookkeeping, payroll or tax needs. Contact our offices in Oklahoma City: 405-720-1244 or Tulsa: 918-477-7650 to get the help you need.