It happens all the time: someone looks great on paper, stands out in an interview and then joins the company and things don’t go according to plan. Their skills aren’t really a match, their experience isn’t translating, and they are not achieving what they were tasked to do. This doesn’t just happen with that seemingly great employee; it happens with partners too. Sometimes the college roommate who started the company, or the colleague you quit corporate America with doesn’t turn out to be the ultimate business partner. These are the issues that every entrepreneur battles.
How do you deal with those who are not meeting expectations? Here are a few things every founder should do:
–Set expectations of excellence and make sure there is clarity on all sides. Expectations must be set high, and must be both aggressive, but achievable. With aggressive goals, hitting 80% of them is amazing, but hitting 100% of goals means you didn’t set the bar high enough.
–Establish a culture that allows people to ask for help early and often. Problems are good because they bring out different points of view and often yield better solutions. If made aware of them early, problems can become opportunities that open up the door for fresh thinking and even innovation. But they must be resolved quickly. Unresolved problems are killer–they stop progress and create gridlock.
–Address issues directly and immediately. Too many founders ignore issues, and they don’t fire people who are underperforming because it’s unpleasant. That’s a critical misstep. Startups cannot tolerate repetitive poor performance, so founders need to engage in discussions quickly. By the time you are aware of weakness, the team has already seen it and it’s late.
–Take a step back to figure out what went wrong. Determine why the employee or founder is struggling. Are they not able to give their full attention? Do they no longer like their job? Have a conversation with the person and get input from the board to determine the appropriate next steps. If a co-founder is underperforming and doesn’t enjoy his or her position, he or she may be willing to accept a reduced role, and therefore reduced compensation and ownership
–Part amicably and celebrate contributions. A co-founder in one of our portfolio companies decided the company got too big and realized he was no longer the best person to grow it. We were able to let both sides win with an amicable departure that honored what he contributed and celebrated what he created.