How To ManageSep 13, 2016 Blog Manage , SME
The management concept is the thing that CEO’s mess up more than anything else. It is the easiest thing to say, but the hardest thing to master. When making a critical decision you must understand how it is going to be interpreted from all points of view, not just yours and the person you are talking to, but all the people around you. When making a decision you need to try and see the decision through the eyes of the company as a whole.
When you have an employee who is hard working, everybody likes them but they don’t have the knowledge or the skills to do the job properly, do you demote them or do you fire them? As the employee, you would of course rather be demoted than fired. Theoretically the company values the employee and wants the employee to be able to stay and to learn and to grow. Should you demote the employee, do you review their package? Is it a lot for somebody not in that position anymore to still that package and is it fair? If you take the compensation away do you think that they will still be productive? The colleagues of the employee will know that a demotion has taken place and will they still respect the employee if they see them going downwards? This is a perfect example of how you are in fact dealing with many people, not just the employee in question.
A good employee comes to you and asks you for a raise. You know that they deserve it, they work really hard and you want to be fair. First you must consider that for an employee to actually approach you and ask you for a raise isn’t something which they have just woken up and decided. This is a serious thing, the employee has thought about this a lot before they have approached you. However, you also have to think about the employees who didn’t ask for a raise. They might even be doing a better job than the employee who did ask for the raise. This is when employees begin to feel like you aren’t evaluating everybody’s performance and this affects the culture of your company.
When it comes to raises you have to be formal to save your own culture. When running a start-up, nobody wants to be formal, but the formal process allows the employees to come forward if they feel they are fitting for a raise. This doesn’t mean that everybody will get a raise when they ask, but the CEO will listen and give the opportunity to express how you feel.
The most important thing that anybody can teach you and one of the hardest things to actually do is to discipline yourself to see your company through the eyes of the employees, partners and those who are not in the room.
This article is based on the podcast by Ben Horowitz “How to Manage”. You can read the full transcript here.