I just came from a brutal meeting with a close friend and colleague who is losing her business. It was a $20 million business that’s been around for 15 years in a stable industry. Our circle of leaders is surprised that this happened — her business has all the marks of a perfect company. Like the marathon runner who dies from a heart attack, this business died from a silent killer.
I’ve been an entrepreneur for seven years where before, as you know from my prior articles, I worked for corporate America. Running my business, I find that there are three things always dominating my mind:
1) Cash — where to find it or how to spend it.
2) Products — are they good enough, or do I need to make them better.
3) My people — my team, are they happy, what do they need, how can I help them. You read that right — I spend a third of my energy on my people! I’m told I am a different CEO because of this perspective. Most leaders don’t think about their people that much. When they do, it’s in frustration. When they don’t, it’s a silent killer.
Every company that I’ve seen fail in the last seven years has been because of a lack of focus on the people. Bad hires, poor performers, mismatched teammates, founder drama, mistrust between people, hands-off managers, micromanagers, leaders avoiding the difficult and necessary discussions, etc. Companies should fail because they run out of money or the market isn’t ready for their product or because their technology isn’t disruptive enough. Companies should not fail because of bad people decisions.
Here’s how this happens: You have an urgent need to fill a role and you hire fast without focus on a perfect fit. Soon, you hire John who is working hard, but he is making mistakes. However, you like him, and he takes some of the work off your plate, so you ignore the mistakes. Soon, the mistakes are adding up. You try to confront John, but he gets defensive and he convinces you you’re the bad guy. Soon, you’re two years into this relationship and you’re frustrated beyond belief. One day you realize that you’ve lost a significant customer because of him, he has overrun the budget, and other key team members feel John’s toxicity and leave you because of him. You fire him, but it’s too late.
How expensive was that two years for you? How much would you have saved if you’d done things differently? What should you have done differently?
First, you start by hiring slow and firing fast. Hiring should be treated like a business process. With any good process, when followed, you have a more guaranteed outcome. Yes, it will take more time, but this spent time is an investment in your business’ health.
Second, onboarding and training your new employee is essential for long-term success. It is also a way for you to be present around if your new employee is truly a fit. When you ignore — or are hands-off — with a new employee you fail everyone in the business.
Third, you must have the difficult conversations. When you decide to be a leader, you have decided to be brave, strong, and do the hard things. Do not skirt this important duty. It’s an art to have a difficult, dignified conversation that results in your desired outcome, but once you learn this art, you’ll be surprised by how positive the impact can be.
Lastly, stay present with all your direct reports. You cannot have these conversations and know that you’re preventing this silent killer unless you have regular check-ins.
I know my friend could have saved her business if she had spent more time managing her staff and being present with them.
I only wish I’d been more present with her sooner. Maybe we could have prevented this terrible loss.
Kendra Prospero is CEO and founder of Turning the Corner, a Boulder-based organization that does recruiting the way it should be done for the job seeker and the company. For more information, visit www.turningthecornerllc.com.