When and how do you fire a bad PM? After 3 strikes? What if he/she lives the culture but doesn't deliver, or the other way around?

Short answer: If the person has been in the role for six months, and you think the individual is a poor fit, it's highly likely you should let the person go. Most folks procrastinate far too long.

I have the same phone call about once a quarter. A CEO will call me as they struggle to decide if they have the right head of product. If the person has been in the role for twelve months and the CEO asks this question, I encourage them to let the person go. Without asking, I know that the CEO has procrastinated on making this tough decision far too long.

Everyone struggles with this decision— from CEOs to first-time managers. They want to give the person another chance or dread doing their job while they recruit a replacement. In reality, the opportunity cost of having someone who can’t deliver results or is “off culture” is far too high. You are much better off when you eventually land a star performer. And the person you terminate is much happier when they find a new job that is a perfect fit for their skills.

Give new PMs Six Months to Learn the Role.

The challenge of product management is that it’s very context-sensitive. The role differs from one company to another, depending on the stage, category, and culture. So I typically give at least six months for Product Managers to find their footing. In extreme cases, I have given a product leader a year to learn the job and have been delighted to see them hit their stride at twelve months.

A 2 x 2 Results/Culture Grid

To your question, there are two dimensions to evaluate PM performance:

  1. Ability to deliver results, and

  2. Culture fit.

Here’s a simple two by two grid to evaluate the situation:

Someone who performs well on both dimensions— the top right quadrant in the two by two grid, is a star. You will likely promote him or her in time. The bottom left quarter presents a clear case for severance. I treat the top left and bottom right quadrants the same— you need to have a serious conversation to help the person embody the company’s culture or deliver more results.

You want to be clear that the person needs to improve. This way, if there’s no progress, the individual won’t be surprised when you ask them to leave. In my two by two grid, I used the word “coach,” but I could easily substitute “reprimand” for PMs who struggle to deliver results or are “off culture.”

It’s rarely a “three strikes” situation. You see lots of little signs that the person is struggling — complaints from peers, teammates, and the exec team, inability to drive results against key metrics, and occasional empty excuses from the struggling employee.

A Star in Every Position

The trickiest situation is the top left corner. Sometimes these individuals are described as “brilliant jerks.” These employees are corrosive to the company long-term, and if they don’t learn to behave in ways that are consistent with your company’s values, you need to let them go. The bottom right is hard, too, but if you can’t get results, you are better off hiring another person who you hope will develop into a star. It makes a huge difference for you as a manager if everyone is in the top right quadrant.

Think for a moment about how nice it would be if every person on your team delivered exceptional results. Imagine spending no time with the poor performers who suck the energy out of you and your team. That’s the benefit of having a star in every position. When I help startups to scale, I typically spend 1-2 days/week recruiting to fill my team with stars. It’s worth the time.

How do you let them go?

As companies shift from an environment that feels like a family to a pro team, or even a “dream team,” learning to let folks go is a critical skill. At Netflix, we gave generous severance packages to make it easier for managers when they hired the wrong person, or the company or role outgrew the employee’s skills. Today, if you join Netflix and are let go the next week, you get three months severance. At the VP level, you generally get nine months of severance. The intent is to give folks time to find a role that fits their skills better.

The conversation is tough. The hardest part for me is orchestrating a meeting time — it’s awkward to casually pull someone aside to ask them to leave the company. I use a previously scheduled one on one meeting for this conversation.

The conversation itself: Get some coaching from your HR partner, but at a high level, be candid, empathetic and treat the employee with respect. Have the conversation in a private place, and remember it’s all about the person, not you. They will be shocked, and you need to give them time to process. They will try to talk you out of the decision; stay firm and communicate that the decision is final. Communicate why you don’t feel there’s a good fit between the company, the role, and their skills. Keep your message simple as the person won’t hear most of what you have to say— they will be too emotional.

The person will feel out of control, so I do little things to give control back to them. In cases where it’s not critical that the person leaves the building that day (lay-offs or fraud), I tell them to sleep on things, then get back together with me the next day. At the subsequent meeting, we craft a plan for what we will say to folks, how and when we’ll communicate the change, and what day they will leave.

Generally, their last day is two weeks later, but if I am trying to be extra generous, I sometimes delay their departure by a month— it’s the equivalent of another month of severance. In cases where I had a lot of respect for the employee, and they handled the transition maturely, most folks couldn’t tell whether the person left on their own volition or not. I’m good with this ambiguity, especially if the person was “on culture.”

A Romantic Breakup

I have let many folks go, and I’ve also been fired, laid off, and have run out of funding. Here are some things that help both the person who is firing someone and the person who is being let go:

  • The goal is “no surprises,” which is why you need to clearly describe how and why they don’t meet your expectations in advance of termination. (Regardless, the person will always be somewhat surprised.)

  • Treating an employee with respect means not looking for a replacement while they are still in the role. Ask the person to leave, then initiate the search. (How would you feel if you discovered there was a “confidential search” to fill your role?)

  • With few exceptions, the person is in a far better place six months later. You can see the weight lift from their shoulders when they find that next “perfect fit” job.

  • No one likes being let go. It’s like being dumped by a romantic partner. You feel blindsided, you’re hurt, but, over time, you realize that this was not the person you wanted to live your life with. You move on. Eventually, you wish you were the one that initiated the breakup.

One last thing. Many companies put employees on a performance plan before they let the person go. I avoid this step as I consider it torture. It’s pretty clear by the time you initiate a performance plan what the outcome will be— you’re simply establishing HR paperwork to protect against a potential lawsuit. I find a generous severance package earlier in the process a more humane approach.

Again, spend time with your HR partner before you let folks go. They will give you more context-sensitive advice than I, especially for folks who live outside the U.S.

My last words: Do not procrastinate.

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