Would You Fire David or Steven?

Your organization is struggling. As a result, you have to fire one of two employees.

David has been with your organization for a long time and is a perfect cultural fit. Young and new employees gravitate to him for mentoring. But he’s never been a high performer and he is at a low point in his performance now.

Steven goes above and beyond from the perspective of clients and, in keeping with this, gets great sales results. But he is constantly agitating for more money and raises don’t satisfy him for very long.

Who will you fire?

Jim Detert, Ph.D., presented this case to participants in last week’s CEO Institute III at the University of Virginia’s Darden Graduate School of Business. The case helped illustrate what motivates employees and how organizational values play into staffing decisions.

CEO Institute III participants who wanted to fire Steven said it would be very difficult to shift his focus from money to something more useful and longer-lasting. Those who wanted to fire David argued keeping him said the culture condoned low performance.

A professor of business administration, Detert asserted that as credit unions move forward he expects that they will more often need to choose the high performer and solve the problem of how to shift the person’s satisfaction away from being all about money.

Detert said there are two fundamental questions to ask when deciding how to respond to an employee:

1. Can the employee do what is needed? (This measures skill/capability.)
2. Will the employee do what is needed? (This measures willingness to apply skills.)

If an employee can and will do the required work, strategies offering a challenge and recognizing and rewarding good results are advisable, Detert said. In contrast, for a capable employee who is not trying, a leader should look for ways to motivate the employee to get in the game. For those who don’t have the skills but are willing to do the work, find them good training. Implement a performance management plan and look at the possibility of firing those who can’t and won’t do the work, Detert advised.

It’s hard to fire,” he said. “The training is a win-win-win. Employee, organization and manager benefit. Not firing someone is a lose-lose-lose.”

Detert provided statistics showing that only about 30 percent of employees from many demographic groups consider themselves highly engaged. Yet having more highly engaged employees brings a whole host of benefits, including fewer safety issues and higher productivity.

The case of David and Steven shows that it can be difficult to determine whether a manager’s efforts will be successful in engaging an employee—or in shifting what makes them feel satisfied.

Detert cited research showing that most people’s pay satisfaction doesn’t increase after reaching a certain threshold, like $60,000. More important predictors of employee well-being, according to Detert include:

• more autonomy,
• close relationships,
• less commuting,
• less noise,
• more exercise,
• more sleep, and
• more vacation.

“A lot of times the very things we give up to get more money are these things,” he noted.

Lisa Hochgraf is CUES’ senior editor.