A long time ago I wrote about what I call ego-merge, which refers to buying into the idea that you and your company are one.

Ego-merge used to be the result of long-term employment with the same company; these days it’s more the result of buying too deeply into the founder’s vision.

“The initial thing of ‘making a life, not a living,’ ‘community,’ ‘better together’ — the terms WeWork pushed as marketing also seeped into this company’s culture in a very real way,” said Kevin Hsieh, a software engineer involved in the group. “There is a looming sense of betrayal and frustration that that wasn’t necessarily followed everywhere.”

Betrayal is no understatement.

Adam Neumann, WeWork’s CEO, walked away with a $1.7 billion golden parachute, while employees are getting worse than screwed.

Combining an intriguing vision, with intense passion and an invincible belief in self, is a recipe that can  hook investors, workers and users — and it did.

Caveat emptor, indeed.

Poking through 11+ years of posts I find information that’s as useful now as when it was written.

Golden Oldies is a collection of the most relevant and timeless posts during that time.

This post is from 2014, but layoffs are again in the news. Almost every day another company talks about cost-cutting and rumors start to fly. Contrary to what you might think, there is a right way and a wrong way to handle a layoff.

Read other Golden Oldies here.

A Friday series exploring Startups and the people who make them go. Read all If the Shoe Fits posts here

The need for a layoff can happen to any company of any age or size, but most companies and managers bumble the task and end up doing far more damage than necessary.

The damage is not just to those laid off, but also to those left behind, themselves and the company.

As most of you have read, Cheezburger Networker just laid off a third of its staff, but great credit goes to CEO Ben Huh for bending over backwards to do it with the least damage possible.

• • He cut his vacation short when he realized what had to be done, as opposed to delegating it and staying away until it was over.
  • He was honest, open and candid with his entire staff, thus avoiding the kind of rumors that typically circulate.
  • He did everything possible to ensure those laid off found new positions, including personally reaching out to other companies and setting up his own job fair.

In short, he did everything I recommended in 2008.

I only know of one manager who got his jollies laying people off (he always tried to do it just before Thanksgiving or Christmas) and he was, without doubt, a sadist.

Most managers, like Huh, find them to be tremendously emotional and not at all fun.

“Often, when faced with a problem, you want to run in the other direction. It’s like seeing a lion in the jungle. But I have to do what is best for the company, even if it sucks emotionally.”

There’s one more required action after a layoff and that’s dealing with the empty space, which can’t be ignored, but can be done positively without spending big bucks.

Image credit: HikingArtist

Poking through  13+ years of posts I find information that’s as useful now as when it was written.

Golden Oldies is a collection of the most relevant and timeless posts during that time.

I wrote this in 2012 and reposted it in 2015. The idea behind it is one the most important and viable concepts a manager (supervisor, team lead, executive) will (can, should) learn during their career. It is the difference between good and great.

Read other Golden Oldies here.

As companies grow and managers build their organizations they frequently talk about “weeding out” low performing employees—Jack Welch was a ninja weeder.

If that thought has crossed your mind you might take a moment to think about James Russell Lowell’s comment, “A weed is no more than a flower in disguise.”

As with weeds, there are better ways to look at under-performing employees.

Seeing a weed as food changes everything, just as seeing people’s potential does.

95% of the time it’s management failures that create weeds and those failures run the gamut from benign neglect to malicious abuse and everything in-between.

Weeds can come from outside your company, inter-departmental transfers and even from peers in your own backyard.

What is amazing is how quickly a weed will change with a little TLC.

“Weeds can grow quickly and flower early, producing vast numbers of genetically diverse seed.”

People grow quickly, too, and often produce innovative ideas just because someone listened instead of shutting them down.

And while trust that your attitude won’t change takes longer to build, the productivity benefits happen fairly rapidly.

So before you even think about weeding look in the mirror and be sure that the person looking back is a gardener and not a weed producer.

Flickr image credit: barockschloss

Two news stories have been running through my mind this week.

A few weeks ago Amazon announced their two new locations for HQ2. Queens and Northern Virginia. Both are already heavily populated and expensive places to live.

And, if we are being fair, those cities may not truly benefit from Amazon arriving. Time will tell of course, but a greater impact might have occurred had Amazon chosen a medium sized city.

I recall the madness/hope by city leaders all around the nation. They lobbied, made promises and petitioned for Amazon to arrive and help their city thrive.

I live in St Petersburg, FL and we have a growing tech scene. We also have an MLB baseball stadium with low attendance and in a prime part of the city. Our proposal to Amazon included tearing that park down and leasing the 80 acres at a reduced cost to Amazon. I’m sure other cities made comparable offers.

All in an effort for salvation from one company.

You hear the other side of it too. GM is closing five plants. Tens of thousands of skilled employees are now laid off. Those were good jobs, too, for the area.

They are the anchor companies that allow the baker, the book store and the banks to survive. When those plants came to those cities it was salvation. People had a job, benefits and could raise a family.

I understand that companies come and go. I firmly believe in the free market and realize that companies are not charities. They are profit driven and make decisions based on the bottom line.

My point to all of this is that cities cannot rely on one industry alone. They need diversity. Salvation is not found in any one company.

What do you put your faith in?

Image credit: Joe Wolf

I had an opportunity to witness two distinct cultures in action in my personal life this past week. I am in the Tampa Bay area of Florida. Like most mid-market cities there are several startups and rising companies throughout. I have friends at two that have had events transpire as of late that had two completely different outcomes and I wanted to share my observations.

One company that is located here is backed by VC’s and has been growing rapidly. They have a great culture from how I understand it. Very laid back, treat you like a friend and encourage all team members to go beyond their own role to take on more responsibility.

My friends who work there always talk about the company with pride and enjoy working there. The CEO is a thought leader in the community and can cut to the core of what is needed to accomplish the job.

In my current role, I also use this company as a customer. They provide data on prospects from several databases. It is not unique as there are many in this space, but they provide an excellent customer experience and the data is usually accurate.

Last week we were told that we would no longer be able to access the application. I reached out to my friends and it was the worst news you could hear.

The company was not able to secure another round of funding and they had to close their doors.

This happened basically overnight. They were brought in on a Tuesday told the bad news and sent on their way.

My first reaction is that the folks who worked there would be bitter about the company and the way they were let go. That could not be further from the truth.

Are they out of jobs? Yes. Do they need to scramble to pay bills? Yes. However, they also felt like they were a part of something bigger than themselves.

President Theodore Roosevelt famously spoke about the man in the arena, “The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming….”

These folks were in the arena and were honored to have strived. They spoke positively of the company and its CEO, realized sometimes you lose and looked at the opportunity to learn as a valuable experience.

In my opinion life is about balance. In the same week as the above news broke I had some friends at another company I am familiar with share some news.

This company is no longer a startup; I would call them a rising company. No VC backing, the CEO started with his own money and they have been profitable through customer acquisition for some time. (I realize if you are in Silicon Valley you may find the concept foreign, but it does still happen.) This company started out with a great culture. Awesome offices, snacks and coffee, smart folks to work with. From the outside looking in it is very desirable.

This company has been on the decline with sales in recent years. It could be the industry it serves or that the products haven’t adapted to the needs of the marketplace.

Speculation from my friends has ranged as they truly believe in the company and its founder. He is a thought leader as well, spends a lot of time with Richard Branson and other luminaries, and is extraordinarily intelligent.

However, sales have been down and it has caused strain on the company.

They recently released the new comp plan for the sales team.

We could discuss how releasing a comp plan in month five and making it retroactive to January is a problem, but that’s not the point of this post.

The team was excited to hear what the new plan would be as some of the teams hit and surpassed their goals last year and figured they would be honored for that.

This could not be further from the truth. The new comp plan essentially cut their income by as much as 30%.

Now the average income for these folks was between $100,000-$150,000 annually. 30% is a huge cut and most may not be able to absorb that. Six figure deals that would bring in commissions of five figures dropped in some cases to the hundreds in commission earned on that deal. I’ll let that sink in for a moment. What’s the incentive to work!

The reaction from my friends there was as expected. They felt betrayed.

This company strives in being inclusive, expecting hard work from the team and tries to create a fun atmosphere.

These folks are invested, they love the company and the friends.

However, when you sign on and are told that you will make X amount and the company flips that on you halfway through the year it causes issues.

I cannot imagine how you would expect a great effort out of team members who feel betrayed and are now worried about paying bills.

Two different companies, two different outcomes.

How would you do it differently?

Flickr image credit: Anthony Albright

Michael Smith, CEO of TeraTech and a past client of mine, sent a link to a Medium post about recognizing the signs that a layoff is coming.

Here are three examples.

• Fresh CEO blood.
• Loss of eye contact.
• Earlier rounds of layoffs.

I  would add

• Lots of smoke and dancing by management, instead of answers.

Obviously, layoffs aren’t funny.

However, management’s belief that no one will notice the signs is funny.

Why?

Because you can’t brag about hiring smart people and then assume they will miss the telltale signs around them that something is wrong.

Image credit: search-engine-land

A Friday series exploring Startups and the people who make them go. Read all If the Shoe Fits posts here

A few weeks ago I wrote about three ways to close a company — the right way, the wrong way and the (allegedly) crooked way — and years ago referenced Guy Kawasaki’s guide to laying people off.

The common thread that runs through them, both the to-do and not-to-do, is the need for honesty with employees and the speed with which rumors will spread and kill moral.

A year ago Twitter laid off over 300 people — most by by email, but some by more of a lockout.

We’re hearing that at least a handful of employees who weren’t remote also woke up to seeing that they were laid off via the fact that their emails and Hipchat, a messaging product, had been turned off overnight.

These days, continuing rumors of more layoffs to come, combined with chaotic reports that the company may be sold, has sent morale spiraling downward at an alarming rate.

Rank-and-file staff members are frustrated about being in the dark on the company’s future, and a handful of employees have stopped showing up for work entirely, several insiders said.

Dorsey’s response to the turmoil is garbage.

“I empathize with the feelings that come from the constant critique, the constant negativity, and the constant doubt.”

There is no way a guy worth more than a billion dollars can put himself in the shoes of someone who depends on their paycheck to feed their kids and pay the mortgage/rent.

And that lack of empathy shines clearly through the rest of his comment.

“But hey, that’s life in the arena. All we control is how we choose to react to it.”

I sincerely hope that his global workforce is choosing to update their resumes and react with their feet.

Image credit: HikingArtist

A Friday series exploring Startups and the people who make them go. Read all If the Shoe Fits posts here.

Programmers in Silicon Valley are reeling.

What are they going to do?

No more clandestine recruiter calls from unicorn startups offering million dollar salaries, six figure sign-on bonuses, thousands of stock options and country club style perks.

And those graduating with CS degrees may find fewer startups bidding against each other for their services.

Not to mention layoffs. Layoff a programmer? Are you nuts?

Nope, that’s exactly what’s happening.

And, as an ex recruiter, all I can say is it’s about time.

Perhaps now candidate focus will return to the mission and the tech, instead of the dollars and bragging rights.

Because, in spite of the all the media coverage, there is a large number of programmers who don’t believe it will affect them — others, sure, but not them.

Of course, it’s hard when you’ve been the golden (mostly) boys and reality rears its ugly head.

But ask anyone in tech who has been around for awhile and they’ll tell you that change is constant and what goes up comes down — and eventually goes back up again.

Programmer jobs not excepted.

Image credit: HikingArtist

Friday series exploring Startups and the people who make them go. Read all If the Shoe Fits posts here.

In 2011 serial entrepreneur Matt Weeks described what he calls the “startup social contract”. In it he talks about the tradeoff of salary for equity and that the basic premise is that the employees have the company’s back, the company has theirs and what happens if it is violated.

If the workers and/or the exec team come to disrespect, disbelieve or ignore this social contract, the company is lost.

Zach Ware, managing partner of VTF Capital, adds another dimension to what it means to have your people’s back and it’s crucial information as funding tightens.

“There is absolutely no reason for a company to shut down overnight. That’s a result of a selfish set of decisions a founder made.”

Ware spells it out by comparing what he did in his own startup, Shift vs. what Maren Kate Donovan, when she shut down Zirtual and laid off 400 people by email.

To start with,  Donavon claimed her CFO gave her incorrect numbers (he denies it) and that she was pitching to the last minute.

“The reason we couldn’t give more notice was that up until the 11th hour, I did everything I could to raise more money and right the ship.”

In actuality she bet 400 other people’s lives on a roll of the funding dice and then took the coward’s way out using email.

Ware finds her reasoning specious.

“Every founder should have a real-time understanding of their business. It doesn’t matter who does it. You have to know it. You have to know your horizons,”

Choosing to not only be a founder, but also CEO, means that, when all is said and done, the buck stops with you. Period.

No reasons, no excuses.

Image credit: HikingArtist

What drives a company’s success as it grows?

Its people.

What drives a company’s culture?

Its people — all of them from CEO to entry-level grunt.

Since Southwest started in 1971 has grown to 47,000, but what is truly amazing is its employment record over those 45 years.

The most astonishing factoid about Southwest is that it has not had a single layoff in its 44 years—a stunning accomplishment in an industry that leads the economy in bankruptcies, re-organizations, mergers and companies that have disappeared. Think Eastern and Pan Am.

SWA was number 13 on Glassdoor’s Best Places to Work in 2015 and nearly 180,000 people applied for work. What criteria does SWA consider most important?

“We have a passion for what we do and we look for people that share that passion. Our mantra is, we hire for attitude and we train for skill. Since our early days we seek people who don’t just have the skill, but also have the passion and the attitude to take care of each other and to take great care of our customers. We work hard to identify that. Many people want to be a part of a team like this. But many times we’ll have employees that say, “You know what? This just isn’t for me and it’s not the right fit.”

Southwest’s CEO Gary Kelly has been with the company for 29 years, the first 15 as CFO, but doesn’t claim hero status.

In an eye-opening interview Kelly talks about the importance of SWA’s culture as a competitive edge and how it’s been maintained over the decades.

If you’re going to have a team, you’ve got to invest the time to create the relationships. The bigger the company gets, the more effort it takes. We use a variety of techniques to do that. Right near my office is a group called Internal Customer Care that keeps track of important things happening in our employees’ lives. (…)I get a pile of thank you notes and in turn I send out thank you notes. It’s creates a very human connection. It’s basic, but very meaningful. That’s why we put the heart symbol in our logo. We’re not the American Heart Association, but our employees believe in the heart and when we deviate from living by the golden rule, people call each other on that. It makes for a very powerful culture.

In short, management spends time walking as opposed to time talking.

Read the interview. While you/your company may not have the money to match Southwest’s benefits, you can certainly create the relationships.

Flickr image credit: Keith Laverack