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Arkansas Business’ reporting constantly reminds me of perhaps the most impactful step businesses can take toward long-term success.
It has nothing to do with balance sheets, business strategy or charismatic leadership — all things we tend to prioritize when thinking about companies’ success.
What I’m talking about is hiring … and firing.
Two stories have recently brought this to mind. The first is the story we brought to you in February about an employee who embezzled money for years from an HVAC company in Sherwood.
The second is a story from last year I recently reread about the legal saga surrounding LaDonna Humphrey and the pediatric therapy clinic that crumbled in her wake.
These are extreme cases; of course you don’t want to hire people who embezzle from you or harass you. The need to fire these two people was obvious in both cases. The much harder skill is identifying hiring and firing decisions that are less evident.
This, I believe, is the foundation of the success of almost every business.
I’m reminded of Jim Collins’ bus metaphor in “Good to Great,” one of the top-selling business books of all time.
It’s a fantastic read, though I think its overarching theory is oversimplified and flawed.
Time has proven as much. One of the chief examples of a “Good-to-Great” company in the book that was also “Built to Last” was Circuit City. Where is Circuit City today? Another “Good-to-Great” company in the book: Fannie Mae. Yikes.
Still, the book is a worthwhile read and remains a favorite because it contains a trove of wisdom, like the bus metaphor.
Whether you’re a family-run HVAC company or a multibillion-dollar public company, Collins puts it simply: “First who, then what.” Before setting strategy, before defining vision, before executing those things — you need the right people on the bus in the correct seats.
Equally important is the willingness to make tough decisions when someone isn’t a fit. This is often where managers and business owners struggle. Letting go of an employee — especially one who has been with the company for years — can feel personal. But if someone is in the wrong seat or shouldn’t be on the bus at all, there’s a responsibility to act. Delaying these hard choices only drags everyone down.
The hardest are those employees who haven’t done anything egregious. They’re often fine people, but they may not be as driven toward fulfilling the company’s mission. They generally take more managing, more prodding. They’re the employees who can’t be left to their own agency.
When you sit back and think about those you have on your bus, your brain usually knows who doesn’t belong. And if you’re serious about righting the bus, the next step is often clear, as uncomfortable as it may be.
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