Terry Cunningham: Hire better, fire faster! Featured

10:34am EDT January 1, 2013
Terry Cunningham: Hire better, fire faster!

One of the questions I wished I focused on earlier in my business career is, “How do I ensure my company remains a great place to work?” The answer: You consciously craft its culture.

What is culture? Try to think about your company as a person, with a specific personality. Do you like it?

You may be thinking the personality (culture) of your company happens organically, or that it’s simply an extension of you. Most founders I’ve met start their companies with a strong vision and a passionate belief in what they’re doing.

When a company is small, it often adopts the personality of its leader because the leader is in direct contact with every employee daily. His or her personality is so dominant that it outweighs all others.

But before you know it, you’re on the road to success and it’s time to hire more people to grow your business — and this is when culture can get away from you.

New people bring new attitudes to work that may be different from yours. But in the spirit of working together, accommodations are made to try to keep people happy. Soon, the company isn’t what you imagined. People aren’t handling customers with the same care you would. Going to work every day isn’t fun. You find yourself thinking: How did we get here?

Assessing an individual’s fit is always a challenge. We all want to hire smart, hardworking, creative individuals. A touch of genius is nice too. Yet if you’ve ever hired anyone, you know that the hiring process is tricky. All kinds of personalities show up for interviews. One candidate arrives with an extensive skill set or impressive resume but a questionable work ethic or flat personality. One shows up with a great personality but less-impressive resume. Whom do you hire?

Use the ultimate test

A friend of mine, who had a successful career as a venture capitalist, once told me about an ultimate test he would apply when investing in a company, called the “Toledo Test.” Here is a variation: Imagine a massive snowstorm in Toledo, Ohio, and you and your hiring candidate are stranded. The airport is closed. You must spend the weekend sharing a hotel room with this person while the storm passes.

If the thought of being with this candidate in this situation strikes fear in your heart, do not hire the person. If the thought sounds fun, evoking images of the two of you solving the world hunger problem over a few drinks, then hire the person.

We can’t always accurately assess someone right off the bat, and that’s OK. Mistakes happen.

Admit your errors

The other key to building and maintaining great culture is admitting when you’ve made a mistake and fixing it. The greatest mistake I made in all my years of business was not firing people fast enough. A bad fit negatively affects the business and also the good hires — employees who are killing themselves for the cause, sacrificing family time and vacations while they watch others goof off.

Now some of you may feel this sounds a little harsh. However, I’ve learned that firing a person who is clearly a bad fit is not only good for the company, but it’s good for the individual. Don’t believe me? At a wine tasting in California, I ran into a woman whom I had fired years earlier. Now she owns the beautiful winery and is so much happier.

So the answer to crafting a successful culture is hire better, fire faster. Spend more time finding the right people so you make fewer mistakes hiring. And when you discover you’ve made a bad hire, remove the person as quickly as possible, before they affect the “personality” of your company.

Terry Cunningham is president and general manager of EVault Inc., A Seagate Co. He founded Crystal Services, which was purchased by Seagate in 1994 and integrated into the company’s software division, which then became Seagate Software. His accomplishments include serving as president and COO of Veritas Software and founding, building and leading two other successful software companies.