Hand Out Pink Slips With Grace

Firing people stings. Many managers lose sleep over poor performers and struggle to do the right thing.

Wielding the ax can be a delicate task that makes even hard-boiled executives squeamish.

Here's how three execs terminated underperformers with a minimum of pain and acrimony:

Dennis Stearns, president, Stearns Financial Services Group in Greensboro, N.C.:

For five years, we had a customer-service employee who wasn't able to develop the financial-services knowledge that we needed. It was a case of a round peg in a square hole.

First, we tried to coach her and give her more knowledge. But she didn't get it.

She had a great customer-service background. So I made about 10 calls to business owners we work with to see if I could find another position for her. It turns out I found a job for her that's in customer service, but doesn't require the technical knowledge that we need.

We are like a family here, so the rest of our employees could see from how we handled this situation that we take care of our family. Now I call her one of our "graduates." She has graduated to another post that's better suited for her.

Julia Hutton, founder and chief executive, Orca Communications, a public relations firm in Phoenix, Ariz.:

We had a great employee. We all loved her. But she just wasn't doing all that well in a public relations role.

A young graduate of a local university, we counseled her extensively. But over a couple of months, it became clear that we wouldn't be able to continue with her.

During our counseling, one of my managers and I tried to discover her passion. She mentioned that she liked the computer field, especially creating Web sites, so we said, "Maybe you'd be happier doing that."

On the day when we let her go, she was relieved. She had a clear idea of what career direction to go. And we gave her a really good reference in those areas pertinent to her new position.

So we didn't just fire her and make her feel terrible. We helped her look around for a better fit. Now she's happy working in her field of choice.

John Mariotti, president, the Enterprise Group, a business advisory firm in Columbus, Ohio:

In the 1970s, I was in my mid-30s and running operations at a small manufacturer. I had a supervisor with a young employee who couldn't do anything right. My supervisor came to me and said, "I can't fire her. You do it." So I did.

This young employee was tall and gorgeous and a cocktail waitress at night. She had a great personality. But she just couldn't handle customer service -- customers constantly complained that she failed to follow through and sent out their orders correctly.

So I said to her, "You're one of the nicest people I've ever met, but everything you touch seems to get screwed up. I want you to be a success in life, but that can't happen here."

She took a long breath. I thought, "Here it comes. There's either going to be tears or retribution -- sad or mad."

Finally, she said, "Thank you so much. My parents taught me not to be a quitter, but you have no idea how miserable it is to be trapped in a job that I know I don't do well."

She taught me it's cruel to keep people in a job that they cannot do. It's better to help them find a better job with their head held high.