A long-standing executive who helped build the business from scratch can no longer handle the complexity of our growing operations, but firing them feels like a betrayal. How do we handle this gap between loyalty and capability?

Question

Tyler Smith · Accepted Answer

This is one of the most painful decisions an entrepreneurial owner faces. Loyalty is valuable, but running a business on sentimentality damages everyone, including the loyal employee. As a company scales, the seats on the Accountability Chart evolve. The operational capacity required to take a company from two million to twenty million dollars is completely different from what was needed at launch.

Evaluate the leader objectively using GWC. Do they genuinely Get, Want, and have the Capacity to do the job the seat now demands? If they lack the intellectual, physical, or emotional capacity to handle the modern scale, keeping them in that executive seat sets them up for continuous public failure and creates immense frustration for high-performing peers.

Have an open and honest conversation outside the Level 10 Meeting. Acknowledge their past contributions and explicitly state that the business has scaled beyond the current seat definition. Offer them a viable alternative role where their institutional knowledge and cultural loyalty add real value without bottlenecking executive execution.

If no such seat exists, craft a generous, dignified exit package. Keeping someone in a leadership seat out of guilt sacrifices the future of the company and destroys enterprise value for an eventual clean exit.