When Loyalty Overrides Performance, Part III

By Chuck Violand

July 2, 2018

In parts I and II of this series, we discussed what to do when a loyal employee or family member is no longer able to effectively perform in their position because the company has grown and the needs of the position have changed. But what if you think this might be the case, although you’re not sure? What if you’re asking yourself whether this applies to you and your company … but don’t know the answer?

It starts with awareness. Until an owner becomes aware of an employee’s deficiencies in doing their job, nothing can change. So, recognizing the performance standards required of each position is a good starting point.

Too often, an owner doesn’t know what good performance looks like. In small businesses, many owners start out with a strong understanding of one or two business functions, frequently operations or marketing, but can have blind spots when it comes to the less-understood functions like finance, HR, or even sales. If they don’t know what good performance looks like in these areas, mediocre or poor performance can continue for years without the owner even being aware of what’s missing.

This is frequently remedied by the owner networking with or visiting similar companies and asking questions. It can also be addressed by participating in industry events or training programs or by working with outside companies who have expertise in their particular areas of need.

Once you become aware, then you must act to address the issue. I see many owners who “talk a good game” about holding people accountable for performance, but back down because, “she has been with me for so long, I really owe her big time.”

Longevity can be mistaken for loyalty. You should be very careful not to fall into this thinking.

I also see owners and managers not addressing the needs of the business because they’re unable to separate the personal from the professional. They allow friendship to get in the way of business, which clouds the issues associated with poor performance and allows a false sense of loyalty to take over.

Trust and loyalty can also become intermingled. The two are not one in the same. Just because you feel you can trust an employee does not necessarily mean that the employee is loyal to you or to the company.

What if the loyal employee you tried so hard to take care of, by moving them into a position better suited to their needs, decides to leave the company?

Realize that employee turnover is not always bad. Employees may leave companies for good reasons: a better opportunity, their spouse changing jobs, or a shorter commute. And maybe their feeling of loyalty to you and the company prevented them from being okay with leaving before. Or, it may have nothing at all to do with loyalty and they just needed to put themselves or their family first. Some owners have a hard time accepting this, but just as they must put the good of the company first, employees must do the same. Even the loyal ones.