According to famed Canadian businessman Kevin O’Leary, entrepreneurs “have to be willing to fire their mom” when it comes time to letting someone go.
Entrepreneurs are tasked with making the final decision to hire the right people to help further their businesses, but what about the unenviable task of firing the wrong people?
In an interview with CNBC co-anchor Tyler Mathisen, the “Shark Tank” television personality discussed the skillsets necessary for entrepreneurs to succeed, including how to deal with terminations and severing ties with an employee. According to small business and startup publication Inc., one of the top five problems faced by entrepreneurs is recruiting the right people.
However, in a separate article of knowing when to fire a toxic employee, Inc. cites that it’s best to resort to termination if an employee or soon-to-be former employee exhibits contagious negativity that infects fellow employees, simply doesn’t care about their job or the task at hand and nothing changes despite one-on-one talks or mentorship sessions. Even if this individual is family, O’Leary feels that, in addition to the sweat and tears, the blood put into the business metaphorically runs thicker than the blood of family.
“When you create a business and you start one, your allegiance has to be to the business first,” said O’Leary. “Because without that, all the good things you want to do are going to fail.”
“As your business grows and you make decisions about individual people, you can’t let your emotions get in the way of what you really need to do, which is to drive the success of the business,” O’Leary added.
O’Leary cited that a common problem facing inexperienced entrepreneurs is that many are often quick to hire a family member or friend because of the existing relationship and level of comfort already established. Hiring a friend or family member into a management position, for example, presents a quandary for entrepreneurs who must face the difficult task of firing them if they are unable to perform.
“Very often, nepotism is what kills the golden goose,” said O’Leary. “Because very often, the better manager is not your sister, brother, uncle, cousin, whatever.”
Rather than simply cutting employees cold, O’Leary cites ways to do it fairly and amicably, such as explaining why the termination is happening and preventing bad karma by ensuring they get a severance package or assistance with locating another job. Furthermore, the termination should take place as soon as the entrepreneur realizes the individual is not fit for their current position.
“The moment you realize that the person isn’t right for the job is the time to take them out of it,” said O’Leary. “Because it’s not fair to them. It’s not about you. It’s not fair to them and the people they’re working with and the team that they’re a part of.”
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