Anamcgary's Blog

Leadership thoughts from PeopleFirst HR

As companies grow, they may outgrow some key employees

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So you have an employee or a few employees who have been with you for a long time. He or she has proven to be a great performer over the years. You’ve probably built significant rapport and loyalty with this person or person’s. Unfortunately employees don’t always grow with entrepreneurial companies.  This is one of the hardest lessons to learn as an entrepreneur or new executive.

As companies grow, they tend to outgrow some of their employees. That’s not surprising: it’s hard for fast-growing organizations to provide enough time and development for employees to keep up with ever evolving needs of the organization.

I’ve seen many examples of owners, entrepreneur’s, CEOs starting small businesses or division with 3 to 5 people. One or two people outshines everyone with their commitment, knowledge and execution.  The owner begins trusting an individual because they know the person can be relied upon to get things done.  And typically their strengths are very different from the owner’s core strengths, so the value to the owner is tremendous in growing the business.

As the business begins to grow, however, a different reality sets in.  Expanding into a company with 20, then 30, and then 40 employees may require a different skill set.  The company may need a different type of leader.  The employee who’s great with your 20, 30, or 40-employee Company will not necessarily be the person to run and operate a business with 300 employees.

Often, I think we can recognize this in our gut, but because of the loyalty we’ve built up, we have a hard time determining and actually deciding to take action.  We let the issue fester, then it only gets worse.

The best way to deal with this situation is by addressing it head-on.

As soon as you notice the issue, or have a gut feeling that you might have one, address it with the employee.  Talk with them about how roles change rapidly in a growing company and ask them how they are feeling about how they are keeping up.

You may find the conversation alone heads off the issue.  Perhaps the person simply hasn’t realized that what is required of them has changed.  This will call it out to them.

Perhaps they are truly struggling and don’t know how to deal with the issue themselves.  This will open up the dialogue necessary to help them get past it.

Perhaps they believe they can make the jump.  This will give you the opportunity to discuss expectations and put them squarely on the table.

In most cases, employees who are struggling with this issue are more uncomfortable than you are.  Putting the possibility on the table (in the right way) communicates your respect for them as a person and gives them the opportunity to dispel the myth or be part of the solution.

Discuss alternatives.

After your initial conversation, your hunch should be either quickly dispelled or rapidly confirmed.  Once it is confirmed, it’s time to discuss alternatives.  If the individual recognizes the issue, discuss alternatives.

Perhaps the role has grown large enough that it should be split into two.  Perhaps there is a new role that is more aligned with their skill-set.

Because you have addressed the issue proactively, you do not have a performance issue.  Instead, you have an organizational optimization issue.  Work together to overcome it.

Part ways, respectfully.

Unfortunately, in many cases an employee is unable to recognize that the company has grown beyond their capabilities in a certain role.  Still others recognize it but are unwilling to embrace change.  They want to hold on to the role that they feel is rightfully theirs.

In both of these situations, it is important that you part ways, respectfully.

I have found over and over again that dragging this process out is painful and detrimental to both the individual and the employee.  It is most often a relief to both your organization and the employee if you take swift action.  When you do, remember, this was your go-to employee.  Take care of them.  Offer them a nice package and celebrate their success as they move on to their next challenge.

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One thought on “As companies grow, they may outgrow some key employees

  1. I think it’s inevitable that when a company grows some employees may well find them selves not quite a correct fit anymore

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