The Moral Molecule

Neuroscience and economic behavior

Firing Well

“There are easy firings and hard firings.”

“There are easy firings and hard firings,” Doug Rauch, the retired president of Trader Joe’s, told me recently.

I was on a conference call organized by Conscious Capitalism, the nonprofit he now leads. The conversation was focused on how to be a leader who fully engages others. Those of us on the line agreed that an unmotivated or unqualified employee is the easiest to fire or to assign to a different position. But what about the employee who is trying hard, but is not hitting required goals? Or what about someone who is reaching his or her goals but is disruptive in some way?

I had a senior employee in my lab who would check his email, rather than actively participate, during our weekly all-hands meetings. After several private conversations with him, he continued his disrespectful behavior. He was an easy fire.

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A hard fire was an employee who was exemplary in terms of the work he delivered. But then I heard rumblings about his sense of entitlement, an inability to collaborate with others and, worst of all, displays of nastiness toward this person and that person. I investigated, I equivocated, I delayed. I should have fired him months before, but, hey, I liked the guy and he got stuff done. When I finally let him go, staff morale went up like a rocket. Why did I wait so long?

My research, and that of others, suggests that Arthur Miller was wrong when Willy Loman‘s boss in Death of a Salesman fires him by saying, “Business is business.” Business is all about relationships, including between colleagues.

Strong relationships at work stimulate the release of oxytocin, the neurochemical that makes us care about others and trust them. We’ve shown in field studies that employees in “high trust” companies are happier and work harder.

But having genuine, human relationships with those who work for us does not mean that we shouldn’t hold our colleagues accountable for their actions.

We owe it to them—and to everyone else in the organization—to be absolutely clear about our expectations. When we fail in this regard, we as managers bear the burden of the person’s poor performance.

And yet, if an employee consistently fails to deliver, it’s time to begin the process of what I call “firing well.”

First, you should work closely with the employee on an action plan so that he or she gets one more real shot at being successful. At this point, I ask the employee why he or she thinks goals are not being met so that there is no misunderstanding the situation. It’s also important to set a deadline when goals must be reached—and to be unequivocal that failure means the employee will need to move on. Should we reach that unfortunate stage, I typically try to offer several concrete suggestions or contacts to help my colleague find a new job.

“Management owes this to the enterprise,” Peter Drucker wrote, “especially to those who perform well.” You owe this, in other words, to all the others with whom you also have trusted work relationships.

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This post orginally appeared on The Drucker Exchange, Sept. 5, 2013. 

Paul J. Zak is a neuroeconomist at Claremont Graduate University in Claremont, CA.  His book The Moral Molecule will be published in 2012.

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