I have a loyal, early-stage employee in a key leadership seat who has given everything to this business, but they clearly lack the capability to lead their department to our next growth phase. How do we balance our personal loyalty to this individual with the objective capability requirements of the seat?

Question

Tyler Smith · Accepted Answer

One of the hardest challenges for a business owner is realizing that an early-stage employee who helped build the company no longer has the capability to run their department. It is easy to let personal loyalty cloud your business judgment, but keeping an underperforming leader in a critical seat is a disservice to the business, your customers, and the employee themselves.

To make this decision objectively, you must use the Accountability Chart and the GWC framework. Evaluate the seat based on what the company needs today and what it will need over the next three years to reach your exit goals. Ask yourself if this individual genuinely gets the role, wants the role, and has the capacity to deliver the required results.

If the answer to any of these is no, you must take action. Loyalty to your employees is important, but your highest loyalty must be to the vision of the company. Keeping a person in a seat they cannot master holds back their entire department and creates resentment among peers who have to pick up the slack.

The solution is to find a seat where their skills and core values alignment can still add massive value, or transition them out of the organization. Real loyalty is being honest with people about where they stand and helping them land in a position where they can be successful, even if that position is outside your company.