Cut the Fat Ep 165

Summary Notes


In this business-focused conversation, Speaker A, with interjections from Speaker B, delves into the challenging decision of whether to retain or dismiss an employee. They emphasize the importance of cultural fit and shared values over skill sets in small business hiring, advocating for the dismissal of those who undermine authority or don't align with the company's vision. Speaker A shares their zero-tolerance approach, citing personal experience and advice from Bart Miller that firing often leads to finding better replacements. They distinguish between character issues, which warrant immediate dismissal, and performance issues, which may require re-onboarding or additional training. Speaker A outlines a detailed process for effectively communicating expectations, training, and providing feedback to improve employee performance. They conclude by stressing the significance of running a business like a high-performance team, not a family, and the necessity of setting a strong tone of authority to foster a productive work environment.

Summary Notes

Decision-Making Regarding Employees

  • Speaker A highlights a common question about what to do with uncertain employees.
  • The focus is on employees who may not have been onboarded effectively, have changing roles, and may not align with the business vision.
  • Speaker A emphasizes the importance of decisiveness in hiring and firing, drawing on their experience at gym launch.
  • They note a low quit rate but acknowledge that many have been let go for various reasons.

"And so the decision that I'm going to hopefully help you make is about that employee that you're not sure about, right."

This quote sets the stage for the discussion, indicating that Speaker A aims to help listeners make a decision about employees they are uncertain about.

The Concept of Finding Someone Better

  • Speaker A shares a saying from Bart Miller: one can always find someone better after firing an employee.
  • This addresses the fear of not finding a better replacement and suggests that keeping a suboptimal employee may be more costly than hiring anew.
  • Speaker A has noticed that with more experience, the time between considering and actually firing an employee has decreased.

"I've never fired someone and not found someone better."

Speaker A conveys Bart Miller's perspective, which reassures that firing an employee often leads to finding a better replacement.

Zero Tolerance Mentality

  • Speaker A discusses the zero tolerance approach to managing a business or department.
  • They refer to high standards set by successful entrepreneurs like Steve Jobs, who would not tolerate poor performance.
  • This approach involves immediate action against underperforming or non-compliant employees.

"And so this kind of reflects back to the zero tolerance mentality of how you need to run the business or your department or whatever it is."

The quote explains the necessity of a strict policy regarding performance and behavior in a business setting.

Timing for Re-Onboarding vs. Letting Go

  • Speaker A differentiates between when to re-onboard an employee versus when to let them go.
  • Disrespect, questioning authority, and not buying into changes are cited as reasons for immediate dismissal due to character issues.
  • The negative impact of such employees on the business and its culture is emphasized.

"If someone questions your authority or disrespects you or disrespects you in front of your team or is not bought into when you want to make changes, things like that, they're gone."

The quote specifies behaviors that are unacceptable and warrant firing an employee due to their detrimental effect on the business environment.

Assessing Performance Issues

  • Speaker A identifies three potential reasons for an employee's poor performance: lack of understanding of expectations, lack of skill, or lack of motivation.
  • These aspects are categorized as communication, skill, and motivation issues.
  • The next step involves identifying which area is lacking for an employee who fits the company culture but is underperforming.

"So there's really three pieces. It's the communication piece, it's the skill piece, and then there's the motivation."

Speaker A breaks down the components that can affect an employee's performance, which are essential to consider when deciding whether to retrain or fire an employee.

Hiring for Cultural Fit in Small Business

  • In small businesses, hiring is focused on personality traits and cultural fit rather than complex skill sets.
  • Cultural fit does not mean finding people who are exactly like the owner but rather those who share similar values.
  • Values should be clear, possibly polarizing, and consistent both inside and outside of work.
  • Real values help employees make decisions aligned with the business owner's thinking, which is crucial for scaling a service-based business.

And so when you're hiring for a small business, you're really just looking for personality traits, right. You're looking for a cultural fit.

This quote emphasizes the importance of personality and cultural fit over specific skills when hiring for a small business.

And one of the key components to looking for cultural fit is not saying, I'm going to find people who are just like me.

The speaker highlights the pitfall of hiring people too similar to oneself, which can lead to redundancy and inefficiency.

There are people who are very quiet, who are very reserved, who don't like selling, who have the same values as I do, right?

The quote illustrates that people with different personalities can still share the same core values, which is more important than having similar personality traits.

If you have these values, you can speak them to people and people will either say, like, yeah, I'm down for that, or like, no, I'm not.

Clear communication of values helps in determining if potential hires are a good fit for the company culture.

Setting the Tone and Authority in Business

  • Setting the right tone is essential for maintaining authority and ensuring that the business values are upheld.
  • Individuals who undermine authority or do not fit the culture should be let go to maintain the business's integrity.
  • Being authoritative does not equate to being unpleasant, but it does require a firm stance on the business's values and expectations.
  • Consistently considering firing an employee for cultural misfit or undermining behavior is a sign that it's time to let them go.

If they're not a cultural fit, they're an asshole. They undermine you, they talk bad behind your back, you want to relaunch a new program and they're whispering to the clients like, nah, it's not going to be that good.

This quote points out the negative impact of employees who do not align with the company culture and actively undermine it.

Gone, right? And you need to do that to set the fucking tone, right? Because this is your business and people need to know that.

The speaker stresses the need for decisive action in removing those who do not fit the culture to establish the right tone for the business.

Now, that being said, it doesn't mean being a dick, but there is a tone that needs to be set.

The speaker clarifies that setting a tone does not mean being harsh but ensuring that authority and business values are respected.

The Importance of Word of Mouth for Growth

  • The growth of the podcast is attributed to word of mouth rather than traditional advertising or sponsorships.
  • The speaker requests listeners to share the podcast in the same way they discovered it, to spread the word and support other entrepreneurs.

The only way this grows is through word of mouth.

This quote underscores the significance of word of mouth as the primary method of growth for the podcast.

My only ask is that you continue to pay it forward to whoever showed you or however you found out about this podcast that you do the exact same thing.

The speaker encourages listeners to share the podcast, contributing to its growth and creating a ripple effect of support within the entrepreneurial community.

Myth of Communication

  • Entrepreneurs often struggle with effective communication.
  • A common misconception is thinking communication has occurred when it hasn't.
  • Clarity is required to ensure the message is understood.

"Layla says the biggest myth of communication, the biggest myth in communication is that someone thinks it occurred, right. You say something, you think you communicate it, and they have no idea what you're talking about, right?"

This quote emphasizes the disconnect that can occur in communication, where the speaker assumes the message has been conveyed, but the listener remains unclear. It highlights the need for confirmation that the communication has been successful.

Documenting Communication

  • Importance of documenting instructions and expectations in writing.
  • Written records are considered proof of communication.
  • Follow-up in writing ensures clarity and accountability.

"And so how do you tell them what you want them to do? It is telling them, and it is always documenting what you want them to do in writing. So for us, if it's not written, it doesn't count."

This quote underlines the practice of documenting directives and expectations to avoid misunderstandings. It suggests that verbal communication alone is insufficient and that written follow-up is necessary for clarity.

Task Management Systems

  • Utilizing tools like Asana for managing tasks and follow-ups.
  • Systems help in reinforcing communication and ensuring tasks are understood and completed.

"And so if you have a system like Asana or something like that, you manage tasks in, then it would even further follow up into tasks that they need to be done."

The quote suggests the use of task management systems as an extension of communication, providing a platform for assigning and tracking tasks, which helps in ensuring that the communicated tasks are understood and actioned upon.

Employee Training and Expectations

  • Employees often face high expectations with inadequate training.
  • Effective training involves practical examples, consistent presentations, and demonstrations.
  • Training should include a process where employees can observe, practice, and receive real-time feedback.

"And typically people are undertrained. They're over expected and undertrained."

This quote points out a common issue in the workplace, where employees are expected to perform without being given sufficient training, leading to a gap between expectations and performance.

Onboarding and Support

  • The onboarding process is critical for setting clear expectations and providing necessary training.
  • Continuous support and communication are essential, especially for new employees.
  • Without proper onboarding, employees may lack direction and motivation.

"Most people have no fucking clue what they're supposed to be doing. They have no clue. They got hired for this job. The boss talked to them for, like, 30 minutes, and then they just went back to their desk and were like, okay, so I think he wants me to."

This quote illustrates the confusion new employees often face due to insufficient onboarding and communication. It emphasizes the importance of investing time in explaining job responsibilities and providing guidance to prevent uncertainty and underperformance.

Clear Path to Success for Employees

  • Employees generally desire job security and will perform if given clear objectives.
  • Providing a clear path to winning can significantly enhance employee performance and retention.
  • A well-defined role and goals can lead to increased productivity from employees.

If you just give them a clear path to win, then they will.

This quote emphasizes the importance of giving employees a clear set of goals and objectives to work towards, which can foster motivation and job satisfaction.

Employee Evaluation and Termination

  • Assessing an employee's fit within the company is crucial.
  • Cultural, behavioral, or personality issues should be a strong indicator for termination.
  • It is often better to let go of an uncertain or ill-fitting employee sooner rather than later.

If you have this person in your business that you are not sure about, if you don't know, you know, let them go.

This quote suggests that if there is doubt about an employee's fit within the company, it is better to part ways.

Reboarding and Role Evolution

  • As a business evolves, employee roles may change, necessitating updates and reboarding.
  • Reboarding can significantly increase the return on investment of an employee's time.
  • Communicating changes and providing updated role descriptions are key to successful reboarding.

Their role has probably changed several times since they've been working with you because you've evolved as an entrepreneur.

This quote highlights the dynamic nature of roles within a growing business and the need for updates to reflect these changes.

Skills Training and Support

  • Employees should be given the necessary training to adapt to their new roles.
  • A structured training process includes understanding through recordings, ride-alongs, and regular check-ins.
  • Gradually decreasing support frequency helps employees become independent while ensuring they are on track.

That's where you first give them the recording so they have an understanding. Then you present, you give recordings, then they do a ride along with you, then you do a ride along with them.

This quote outlines a step-by-step process for training employees in new skills or roles, starting with providing recordings for initial understanding.

Maintaining Team Productivity

  • Letting go of underperforming employees can lead to increased team productivity.
  • It is important to maintain a team dynamic, not a family dynamic, as performance is key.
  • Regular evaluation and willingness to make changes are essential for a high-performance team.

I've never let someone go and not found someone better. And I will say that productivity of a team typically always increases after someone is let go.

This quote suggests that removing underperforming employees can be beneficial for the overall productivity of the team, as it allows for the introduction of more capable individuals.

Business as a High-Performance Team

  • A business should be run like a high-performance team with clear expectations and standards.
  • Coaches and leaders should foster an environment of high performance.
  • Removing underperforming team members is necessary to build a successful team.

If you're like, we're a family here, you need to get that out of your lexicon because you pay someone, right?

This quote challenges the notion of a business as a family, arguing that the professional relationship based on performance and payment should be prioritized.

Anecdote on Team Dynamics and Coaching

  • Personal experiences in sports teams can inform business leadership and team dynamics.
  • A good coach can turn around a bad team by setting high standards and fostering a positive environment.
  • The speaker encourages listeners to apply these principles to their businesses for better performance.

Many of us in fitness played for teams. A lot of us played for high level teams. And you've known what a good coach is like, and you know what a bad coach is like.

This anecdote draws a parallel between sports teams and business teams, suggesting that similar principles of good coaching and team management can lead to success in both areas.

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