Startups Made Simple Step Five: Manage It – The Right People

Below is an excerpt from our book Startups Made Simple: How to Start, Grow and Systemize Your Dream Business. Learn more about the book here.

The Right People

Finding the right people for a small business with limited resources is a challenge to say the least. You probably will be offering limited or no benefits (about ⅓ of small businesses offer zero benefits or even paid time off, less than ½ offer health insurance) and a pretty uncertain future, especially as a startup. Not offering benefits or job security is going to eliminate a lot of people from the potential job pool. I would say that finding and keeping the right people is probably the number one problem in businesses both large and small. There are hundreds of books (and consultants, websites, etc.) on this topic, so hopefully we can simplify this process into the core basics. 

I believe the best way to find, train and keep the right people includes: 

• Pay Better and Offer Non-Compensation Benefits
• Write Great Job Descriptions and Ads
• Good Interviews and Assessments
• Train and Onboard Properly
• People Management Best Practices

Pay Better and Offer Non-Compensation Benefits

If you read anything about modern business management, you’re likely going to encounter an article on how to motivate millennials or young people in general. I’ve seen so many of these (and related videos, presentations and more) that I’m starting to wonder if something is in the water to make their generation so different from others. While Generation Xers like myself and older generations tend to laugh and dismiss a lot of that stuff, I believe there are some good points to be made about millennials (who are now the largest part of the workforce) and the modern workplace in general. 

Think about it; this generation has inherited massive debt from the previous generations (which makes us look incompetent and selfish), their job prospects are dwindling due to global competition, outsourcing and automation (things mostly done by us), and if they try to improve the situation by going to college, they add on even more debt (and their degree may only get them a job as a barista). Social media (again, mostly invented by their elders) has taken normal human interactions and exposed and complicated them so much that anxiety, depression and various ADHD-like disorders are now rampant and many are hopelessly addicted to their devices.

To add insult to injury, they then have their elders telling them to “just get a job and work hard like I did.” As if the modern workplace is anything like the manufacturing job you could get in the 1970s straight out of high school with full benefits, rock-solid job security, a pension, and pay good enough to raise a family of four on a single income. Needless to say, I think we need to give the younger generations a break or at least the benefit of the doubt. I’m not saying that some don’t make bad decisions; I’m saying that bad decisions and lack of work ethic are not the whole story. 

So what do these modern workers want? Surveys say they tend to care more about having some kind of impact at work while having a good life-work balance. By “impact,” they mean they want to contribute, see their work as valuable, and not work for a company that acts like an evil empire (and ideally is doing some good). 

By “work-life balance,” they mean they don’t want to work themselves to death like previous generations (especially when there is so little company loyalty to employees these days) and would like to get some kind of benefits at the job. Notice that I didn’t mention high pay. This is consistently a lower priority to them than the things we mentioned; they mostly want fair pay and regular performance reviews. 

Employers want accountable people that can get the job done, but a lot of employees want things like impact and benefits. As with most things in life, I think we can arrive at a nice balance. 

I believe a small business should always pay the most they can afford for the best people possible. I see small business owners consistently offering rock-bottom wages and expecting top-dollar performance. They should know better, and frankly, an extra $1 or $2 per hour is only $40 or $80 per week extra per full-timer, and you’ll attract a much higher caliber of employee. Let me just say that the difference between a good employee and a mediocre one is usually worth way more than $40 or $80/week, and this increases exponentially as you go up the talent and pay scale. 

However, many times a startup is short on cash or may work in a low-skill or low-margin industry (perhaps with many employees) and the extra $1 or $2 per hour is the difference between a profit and a loss. In these cases, and in general, I think it’s important that you offer some sort of non-compensation benefits. Offering these will help employees have a better work-life balance and will generally increase job satisfaction. The best part is they don’t cost much and are pretty easy to implement. 

Some great non-compensation benefits are:

• Flex-time. A lot of managers don’t understand how hard it is to get to a doctor’s appointment, the bank, or even a child’s haircut during working hours. Have a simple policy of “take an hour, make up an hour” and let your employees relax to get these things done without hassle. 
• Simple or no dress code. Nothing grinds my gears more than a company that requires their employees to dress up when they have zero customer interaction or the customer doesn’t care about their appearance. Laundering, dry-cleaning, and applying makeup for a strict dress code adds unnecessary time, expense, and hassle to everyone’s life. If it’s not absolutely required, do away with formal dress codes or only require them for certain employees (salespeople or retail employees, for example). 
• Work from home options. If the job can be done from home as effectively as it can in-office, then at least offer to allow some work from home.
• Meals and snacks. It’s amazing, if you read reviews of companies on some employee review sites, even the horribly dysfunctional companies get praise for providing meals or snacks. Keep a fridge stocked with your employee’s favorite beverage or snack and buy your team lunch or dinner when you can. 
• Holidays off. I realize a lot of businesses are open on holidays (and in fact, even busier on those days) but that doesn’t mean that every employee has to work every holiday; this will just demoralize them. For example, if they have to work on Christmas Eve, make sure they get Christmas Day or New Years Day off. 
• Grieving and/or unpaid time off. Allowing ample time for grieving and sick care is just common decency. Modern life is complex, and sometimes an employee needs to step away for awhile to deal with various issues. This benefit can be abused but I’ve found that to be rare. 
• Birthday gifts. I think it’s also common decency to at least acknowledge employees’ birthdays, so make sure you have them on a calendar. Cards, gifts, and even letting them take the day off would be great additions as well. 
• Predictable schedule. If you want to drive a human crazy, then make sure they have no idea when they’re working until the last minute, don’t give them consecutive days off, and give them zero ability to plan any kind of vacation or personal time. Seriously, at least make their schedule as predictable as possible and get better at scheduling yourself if this is an issue. 
• Good environment. Nobody likes to go into a dark, depressing, messy office or location. At the bare minimum, keep things clean. Natural light, good air conditioning, and measures to control sound are all good ideas (some repetitive or annoying sounds can drive people crazy). Don’t underestimate good sound control or dealing with employees who have loud or otherwise annoying vocal habits. 
• Good tools. Dealing with old computers, broken machines, out-of-date systems, uncomfortable chairs, and more can just add unnecessary stress to the job and will decrease productivity. Schedule a regular review to assess and update your tools. See the section on The Right Tools. 
• Good management. Everything in this chapter is about having an effective management system in your company. Clear job descriptions, written procedures, regular reviews, best practices, and effectively dealing with hassles and issues all make work a more pleasant place. The Golden Rule also applies here; treat your team as you’d like to be treated if you were them. 

Finally, if you build a great business with great vision, values, execution, and leadership, then you’re naturally going to offer your employees a workplace where they feel like their work matters and they can contribute. Paying better, offering some of the benefits above, and building a great management system will all work toward your ability to attract and keep the right people. 

Write Great Job Descriptions and Ads

If there’s one thing that will immediately improve the quality of your hiring, it is writing great job descriptions. Great job descriptions then become great job ads. Great job ads attract better quality candidates and can actually filter out lower-quality candidates, which will save you a lot of time and grief. 

The Job Description

It’s important that when you go to hire someone that you’ve written a clear job description that covers exactly what needs to get done, what the definition of “done” is, and the skills and traits of the ideal person to get that job done. That’s basically it; it doesn’t have to be that hard, and many job descriptions fit on one page. Here are some quick tips for writing job descriptions:

• Identify what’s needed first. When you’re looking to hire someone, try to make sure you know exactly what’s needed and what you’re hiring them for. Many founders simply get overwhelmed and hire somebody (anybody) to help them out of desperation. Make a list of tasks that need to get done (see the Right Process section above), and identify the tasks you want to delegate (especially the ones that you hate). Group them into a job or jobs with related functions (Admin, Operations, etc.).
• Write a narrative. While the above will be a list, write a paragraph or two of exactly what the mission for this position is, why you’re hiring them, and what they’re generally expected to do each day. Just writing this out will clarify exactly the type of person you need. 
• Describe the desired results. Now list the results you expect. This is important for accountability and what you will emphasize in interviewing candidates. You can show them this list and what’s expected. 
• Describe the qualification and skills. What does this person have to be competent at to deliver the desired results? List everything from educational background requirements to personality traits like patience or resourcefulness. Note that a lot of the Founder Superpowers are great traits to hire for and develop in your hires, so look to them for inspiration. 
• Define measurable metrics. Try to identify 3–5 measurable accountabilities for each job, so that when you have to evaluate their performance, you can point to each measure and see how well they’re doing. For example, for a customer service agent or supervisor, it might be the customer satisfaction score in surveys or the number of customer complaints.

There are other tools like the Job Scorecard made famous by the book and hiring system called Topgrading by Bradford Smart. But, like other things, it’s important to just get down some basics first to organize your thinking and tweak and improve them as you go. Writing good job descriptions will do 90% of the work in writing job ads, which is what we’ll cover next. 

The Job Ad 

Most job ads are terrible, and then the business owner is surprised when they get terrible applicants. For example, here’s a real job ad I randomly pulled off of Craigslist (there are many just like this) for an Office Assistant:

Office Assistant needed for real estate office. No real estate experience needed. Part time – 20 hours/week – with potential for full time at a later date. Must be able to use online websites to upload and download information, track deadlines and due dates, use Adobe, and Microsoft office. Please email resume with cover letter for consideration. Hourly pay with no benefits.

Let’s analyze this: 

1. As a potential employee, I know absolutely nothing about this company. What does this company do? Do they sell or manage real estate or maybe they invest in real estate? What is the company name? Are they trying to hide something by not even putting their business name on the ad? How could I do further research on them to see if I’d enjoy working there? What does the company value and what is the work environment like? This could be the greatest or worst company on earth, but how would I know? 
2. There’s no pay specified at all. Does this pay $9/hour or $20/hour? Who knows, and dozens of applicants will have to guess if this is worth their time, within their range of salary requirements necessary to live and possibly go through a long interview to find out. This is a complete waste of everyone’s time. If a business has a fantasy of hiring someone worth $20/hour for $10/hour by not specifying salary, it’s just that—a fantasy. Good people know what they’re worth. 
3. What is required, and what does every day look like? I see a few requirements like Microsoft Office, but what do they really need? Expert-level Excel spreadsheet formulas or just basic Microsoft Word? Adobe what? Photoshop or Acrobat? How many words per minute typing speed should this require? Will I be mostly doing email or on the phones all day? Some people are great at one or the other. 
4. They’ve required nothing specific to filter out poor candidates. They’ve simply asked to email a resume and cover letter. With so many modern tools for applicants to quickly apply to dozens of job ads in a day, it’s important to require something out of the ordinary to filter candidates for your company (provided you’ve even described your company and the job well). Trust me, you’ll want a filter. Our last job opening received over 400 candidates, and ¾ of them were filtered as I’ll describe below. 
5. They haven’t pushed the benefits of the job at all (if there are any) and then say “no benefits” to drive home the misery. Remember our discussion about benefits above? You’re not going to get the best candidates if you have nothing to offer them, not even the most meager of things like some flex-time. 

Now that I’ve pummeled that ad to death (sorry, this is a big pet peeve of mine), let’s see what a job ad looks like that regularly gets hundreds of well-qualified candidates and has proven to work for years. Note that it’s for the exact same title of Office Assistant. Also note that, while it is long, it can be easily shortened to be placed in classified ads with a link to a job website (e.g. company.com/jobs) to view the full description.

I believe this ad has proven to work because of several factors:

1. We’ve described our company: who we are, what we do for our customers, how highly rated we are by the BBB, etc. I’ve even given the address so applicants can check how far it is from where they live (commute time is a big employee complaint). 
2. We’ve clearly stated the exact qualifications (even including disqualifications), daily duties, and experience required. 
3. We’ve clearly stated the pay and mentioned the bonus program. 
4. We’ve listed the benefits of this job, and note that I’m even mentioning that we don’t offer health insurance (which is a long story related to being small and multi-state, so I explain it carefully during phone interviews). Instead, I’ve made the pay higher than most Office Assistant jobs in my area to compensate for that and listed the many non-compensation benefits we offer.
5. I have what I call a “tripwire” at the end of the job ad that requires the applicant to have read down that far and pay attention to the requirements for submitting a resume. We use this for any job that requires a detail-oriented person (and most do). 

This ad has been used, with few changes, for over a decade, and it has produced very good results (we modify it for other positions but mostly it’s the same template). It’s not perfect and doesn’t always work (nothing always works when dealing with humans), but it’s served us well over the years. You may not be able to offer some of the higher-end benefits like paid holidays or a 401k, but just do what you can to attract a higher caliber candidate and pay as well as you can afford. 

Good Interviews and Assessments

A good job description and job ad should hopefully generate plenty of qualified applicants. Next, you’ll want to learn some basic interview tactics and some kind of assessment or trial period so you can see if your candidate has the skills you need. 

Identify your top ten or so candidates for each job, and then do a phone interview. A phone interview is a great way to filter out candidates and prevent the wasted time of too many in-person interviews. Set up phone interviews for these candidates and have a consistent way you talk to all of them (write out a script and checklist) so you can easily compare them to each other and also detect any potential issues, which we’ll discuss below. Generally, you describe the job, ask specific questions of your candidates related to the job, clarify anything about their resume or availability, and ask them if they have questions. You can find many examples of questions and scripts online. 

After phone interviews, you may wish to invite your top three or so candidates for an in-person interview. This is a good opportunity to show them around, let them get a feel for the company, and hear a detailed explanation of the job and what’s expected. I often say that a good employee interview is more like “job dating;” you want to see it they’re a good match for the job, your company, and even your personality and the personalities of your current team. This will give you a good opportunity to assess their interpersonal skills as well. 

In-person interviews can be quick or long depending on how important the job is to your business. Topgrading and other books recommend very long, detailed interviews (several hours long), especially for higher-level positions. My philosophy on this is that it really depends on the job and skill-level for which you’re hiring. 

Lately, I have been leaning toward assessments and trial employment periods instead of very long interviews. Employee assessments are becoming very advanced and can even score employees based on how successful they are likely to be for the specific type of position you are offering (they have access to historical performance data from many other employees and companies). These can run from very simple 20-question tests to very long assessments for high-level executives. I have some listed in the Chapter Resources. 

You can create your own assessments as well, but be careful about various employment laws when doing so. For example, if you are hiring for a detail-oriented clerical position, then create a spelling and editing test. If you’re hiring for a chef, see how they prepare a specific dish. 

Finally, more and more companies are simply hiring an employee as a contractor or for a trial period of a day, a week, or a month to see how they do the actual job. My company does 30-day trials for most new employees, and we assess how they’re doing at the end of 30 days. If you’ve written the job description well and specified the expected results, it shouldn’t be a hard decision to make after seeing the person do a job. 

Hiring and interviewing is more of an art than a science, and improving your skills over time will add greatly to your business. I’m still learning things after 15+ years of hiring people. Remember to always verify what you do against your local laws. That said, here are some good practices for interviewing and assessing:

• Clear dob descriptions and ads. Again, you can’t expect good results (or candidates) from vague job descriptions and ads. See the previous section. 
• Write good questions. You’ll want to come up with 3–5 questions directly related to the job you are filling (“How would you handle..” and “What is the best way to…” types of open-ended questions seem to work well) and ask the same questions of each candidate so you can compare them. 
• Threat of the reference check (TORC). Topgrading and other books recommend you do reference checks on all candidates. They even recommend you let candidates know you will be doing reference checks in the job ad and interviews and even have them arrange the call. The simple threat of a reference check will filter out a lot of bad candidates. 
• Watch for warning signs. There are many of these you can find online, but some obvious warning signs during the interview (phone or in-person) include dishonesty, talking poorly about previous employers or supervisors, inability to recall work history, poor phone demeanor, poor interpersonal skills or sloppy appearance, etc. Many things depend on the job, so identify what’s important to you and screen for that.
• Use or create assessments. As discussed, using a good assessment can help you really filter out bad candidates or at least see if they can do the actual job. Consider trial periods as well. 
• Screen for personality. It’s becoming more popular not to focus so much on credentials or experience but to instead focus on the type of personality that does well in a particular job. People with a great attitude and traits like helpfulness, conscientiousness, and a pleasant demeanor seem to do much better than others that are disagreeable and have a negative attitude. SWAN is also a well-known criteria which means: Smarter than average, hard Working, Ambitious, and Nice. Being thick-skinned (or not hyper-sensitive) is also a trait I’ve discussed that’s valuable for startup employees.
• Background check. I background check all employees because we deal with credit cards and other sensitive information. I recommend that you background check any employee for anything remotely sensitive in your workplace. Some states have strict rules on this, so make sure to check. 
• Focus on accountability. As I discuss in Superpower #14: Accountability Mindset, it’s important for you to let each candidate know the results you expect and that they are accountable for these results. If you don’t make it clear now, then it will be that much harder later. 

Train and Onboard Properly

After you’ve chosen your candidate, send them a written job offer (and make sure to politely inform the candidates you took a pass on; you may need to call them back if this hire doesn’t work out). Now, you’ll want to bring this new hire onboard and train them. 

This is where a lot of small businesses completely drop the ball by throwing a new employee to the wolves with zero resources or guidance. That’s terrible for a lot of reasons but mostly because it starts everything off on the wrong foot, is awkward for the employee, and shows that you don’t care that much how things operate (which also demonstrates low standards). 

This doesn’t have to be hard or complex. Make a simple list (save it and re-use it for other hires) of everything a new employee needs to do starting with a nice tour of everything (where to park, eat, bathrooms, etc.), meeting the team, doing hiring paperwork, setting up email or other accounts, learning about the company, etc., then going through their job description duties and learning how to do them properly. 

Obviously, documented procedures here will help greatly, but at the least you’ll want to train them personally or assign someone else to train them and be their “buddy” or mentor as they train. Show them exactly what “done” looks like and schedule regular follow-ups to check-in on their progress (or have their buddy keep you informed of progress). 

People Management Best Practices

This topic also could be an entire book;  it’s not only important but probably the most difficult thing about owning a business. Managing employees, especially holding them accountable and having to confront the many problems and issues that dealing with humans entails, is not most people’s favorite thing to do, especially entrepreneurs. In fact, poorly managing people or ignoring problems is how a lot of employee situations become bad in the first place. 

The classic comedy movie Office Space, which details the dysfunctional management at the fictional company Initech, is one of my favorites and demonstrates the day-to-day frustrations of many modern office employees. It’s actually pretty insightful about people management and the things we’re discussing here. 

Think about it, these guys just wanted some clear structure and communication (not eight different bosses and the same memo about TPS reports over and over) and some performance incentives (see the Leadership Superpower #15: Team Development and Motivation). Otherwise, why would Peter do more than the bare minimum?  

Furthermore, they want the Right Tools (not a printer that was constantly broken), no silly dress code (see non-compensation benefits above), no empty platitudes about “Is this good for the company?” (try real Core Values or Principles instead), and to get rid of simple hassles around the office (the doorknob that shocks everyone and perhaps another office or location for the red-haired receptionist with the annoying phone voice). 

I would even argue that they would probably have respected being held accountable for more than 15 minutes of real work a week, which would have given them a sense of accomplishment and maybe some pride in the job. Who knows, maybe Peter was just a bad hire in the first place (he did try to steal from the company after all) and could have been filtered out with decent interview skills. The point is that many of these seemingly small hassles build up and can make people crazy. However, problems can be fixed in a workplace, which doesn’t have to be a corporate dystopia. 

I think there are some pretty simple rules and best practices for managing a team:

• Learn the leadership superpowers. As I discussed in the chapter on leadership, there are many things to learn to master the management of employees, and it can be a struggle for many entrepreneurs and their managers. I highly recommend you review that chapter if necessary, especially with your managers (if you have any). 
• Hire, train and treat employees well. It basically all comes down to that. The concept is not hard but the implementation can be challenging, and there are always employees who won’t perform well no matter how well you do things. 
• Clearly defined job and expected results. As we’ve discussed in this chapter quite a bit, the solution to a lot of employee issues is being absolutely clear on what is expected and the results they are supposed to achieve. If the job is clear and the definition of “done” is clear, then the performance should be clear against those measurements.  
• Measurable results. Even better than clearly defined results are results you can measure. If you have measurable results that you’ve both agreed on, then when you are giving a review of an employee or need to coach them to better performance, you can point at a measurable number (like number of cold calls, number of orders processed, customer satisfaction %, etc.) and you will both know the truth with little space for argument over performance. 
• One person for one job. I cringe when I see a “team” arrangement for some jobs (co-CEOs, co-managers or even two “leads” for a team of employees) because I can tell you right now: if two people are accountable for a job, then nobody is accountable and problems (the blame game) are not far behind. Make one person accountable for one job (starting with clear job descriptions). For example, if there are co-founders, make one the CTO (or COO, etc.) and the other the CEO. On a management team, make one person in charge of Operations and one in charge of Admin. 
• Staff properly. Overworking a skeleton staff might be justified for a while in a startup, an emergency, or the loss of a key employee, but it shouldn’t be standard practice. Make sure you staff adequately and make your team and managers accountable for letting you know when they need help or more people. Constant overtime or managers working in excess of 45 to 50 hours per week is a good indicator of this. Note that if managers are working that much but employees are not, then they likely have a delegation problem or are not being forthright about needing help. 
• Vision, purpose and goals. As discussed earlier, having a clear vision and a purpose can be very motivating to founders and employees alike. It’s always nice to know you’re working toward something bigger than yourself. Goals are great to have because it feels great to meet or exceed them, especially if you reward your team for doing so. 
• Do meetings right. Entire lifetimes could be wasted in ineffective and boring meetings. Employees mostly hate them. We’ll go over this more in the Right Routines section later, but the key is to have meetings only if necessary, keep them focused on actionable solutions and decisions to be made, and keep them as short as possible. 
• Get things in writing. If you’re going to have a call, meeting, or face-to-face conversation about the business, make sure that the result is actionable with clear written decisions. Most employee, customer and founder disagreements can be avoided by clearly putting things in writing, even an email. Be wary of people who resist putting things in writing and demand it from your staff (it forces accountability). 
• Do regular reviews and 1-on-1s. You should review each employee at least yearly (even more if you have the time) to review performance, adjust pay and/or promote or move to a better place for them (right person in the right seat). Many companies are adopting regular 1-on-1s (every month or two) between managers and their staff, and this seems to solve a lot of the problems and issues that we’ve discussed. It can be good to let an employee vent a bit and discuss their problems, goals and more. There are many resources online for effective 1-on-1s. 
• Good process. As discussed in this chapter, having broken, undocumented, or no real process in your business is a recipe for chaos and employee frustration. Make having a good process part of your strategy for hiring, training and keeping good people. 
• Use an Issue List. As described in the book Traction by Gino Wickman, an Issue List is a great way to de-hassle and solve problems within your company from both employees and customers (assuming you actually use it and fix the problems). We’ll go over that more in the next section of this chapter on the Right Tools. 
• Praise and rewards. Rewards, bonuses, and non-compensation benefits can definitely make life better for employees, but a simple “Hey, good job” and generous praise for a job well done is motivating to many employees. One caveat: Be wary of people who seem to need praise for just doing the bare minimum; this is often the sign of a poor-performing employee. 
• Delegate effectively. If you don’t learn how to delegate well, you’ll simply say yes to every request from your team (or you’ll just do it because you can do it faster and better) and work yourself to death. At the least, write procedures for the things you dislike doing and train others to do them. If you’re overworked and don’t delegate, then the company can never move forward, and you’ll never earn your freedom. Delegation is also how you develop your team’s skills.  
• Hand the monkey back. Related to delegation, the book The One Minute Manager and the Monkey shows that a very effective tactic is to take your employees requests and “give the monkey back” to them so it’s not on your back. For example, if an employee says that customers are having a hard time figuring out something about your product, you might tell them, “Will you please collect all the customers’ names who are having this issue in a spreadsheet, send them an email asking for specific details on the problem, log the problems, and send me your ideas for fixing it by close of business Friday?” This builds problem-solving and accountability into your team and is a great way to help them take ownership of issues. 
• Honesty and trust. Being honest, open, and willing to listen and debate ideas openly is a great way to build trust and accountability. Once you’ve built trust, then a lot of problems disappear because you know you can count on your team. If you’re deceptive or break trust (or if they do), then bad things are going to happen. 
• How you work best. Let others know how you work best, especially your managers and direct reports. For example, if you work late and prefer things via email (and that you don’t expect replies to emails sent at 2:00 a.m. until business hours) or if you like anything done a certain way, then make sure to show them what that means exactly. 

The rules are pretty straightforward; it’s the actual living by these rules that’s the hard part for almost every founder or manager I’ve ever encountered in business. People can be hard to deal with, and the better you get at it, the easier your life will be. 

Managing Poor Performers and Toxic People

The final thing I want to go over on the topic of the Right People is what is generally considered the hardest part of people management: managing poor-performing or toxic employees. I think only a sociopath actually likes to tell people about their shortcomings or fire people but there are some best practices to doing this as well. 

Let’s start with what I call toxic people: Get rid of them. Toxic behavior includes constant complaining (without trying to solve the issue or even present it to those that can fix it), a negative attitude in general, pessimism, bullying or intimidating others (or customers), dishonesty, and my personal pet peeves: talking negatively about others behind their back and gossiping.  

Listen, I like an honest, open and even aggressive discussion of ideas and problems, but that’s not even close to what I’m talking about with toxic people. Toxic people make their teammates uncomfortable, angry or jealous (usually with incessant gossiping about others’ salary, promotions, how they are performing, who they are dating, etc.) and generally drain the energy of everyone who has to deal with them. 

I don’t care if they’re the best performer on your team; they still need to go. The one exception I’ll make is if you somehow have some kind of super-genius with an incredibly rare talent working for you, then isolate that person (make them work from home) and minimize or eliminate their communication with your team. This is incredibly rare, so my default recommendation is to get rid of toxic people as soon as you can according to your employment laws. Make sure to document absolutely everything carefully because these are also the types that will “go legal.”

People who are performing poorly, as long as they aren’t toxic, are actually not very hard to deal with in comparison. The antidote to poor performance (and not hiring toxic people as well) are the many things we’ve mentioned in this chapter including clear job descriptions, expected or measurable results, hiring for good personality traits and having a good management system. 

However, as any manager will tell you, even if you have all those things you’re still going to have a few bad apples get through the process. Again, when dealing with humans this is to be expected, so don’t let it ruin your day. Some simple coaching and a written plan to correct things is usually very effective. 

The One Minute Manager and many other books show that a quick conversation that clarifies what’s expected and corrects the behavior is a great start. If the issue happens again then you’ll want to give a written warning specifying exactly what needs to change and by when (see examples of these online and in the book). 

Finally, a “three strikes” rule is appropriate for most people: If you have to warn about the same issue three times then the person should be let go. If you do things right, this shouldn’t even be a surprise to the employee and many of them will quit before the third strike because they know they may simply not be able to meet or even want to meet expectations. 

A final word on doing warnings and firings is what I call “five minutes of pain.” After you’ve clearly documented everything in writing and covered all the legal bases, just get the bad part over with as fast as possible. Don’t torture yourself or your team with bad employees. Consider that maybe you might actually be freeing this person to move on to someplace better. Some people saying that getting fired was the best thing that ever happened to them because it forced them to change careers to something better or and removed them from an environment that wasn’t ideal for them. Getting rid of toxic people and poor performers will dramatically improve your workplace so don’t hesitate to take action.
This was an excerpt from our book Startups Made Simple: How to Start, Grow and Systemize Your Dream Business. Learn more about the book here or see our previous excerpts here.

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