Comment by Aurornis | Hacker News Reader

Comment by Aurornis | Hacker News Reader

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As a corollary of these people problems, I would add:

1. Not correcting problem hires fast enough.

First time founders are often too hesitant to give negative feedback, demote a too-technical manager who should have stayed an IC, or remove a problem employee who isn’t working out.

The anecdote that comes to mind is a local startup that hired a C-level executive’s UI designer friend into their VP of Product role. He was wholly incapable of doing the job but they kept him in the job for 2 years to “give him a chance to grow into it.” Everyone below VP level openly talked about how the VP of Product was incompetent and how to work around him.

The company’s product initiatives ultimately failed to even get started and they had to pivot to entirely services based work. Do not stay at a startup that insists on keeping unqualified people in leadership positions long after everyone in the company has given up on them.

2. Firing the wrong people

The same startup was forced to downsize, largely because their product plans failed to even become defined enough to start under the incompetent VP of Product.

It was the perfect opportunity to fire the VP of Product and his sprawling empire of people who did very little, but they avoided that due to his connections to a C-level executive. Instead, they started cutting engineers. They focused on cutting engineers with the highest compensation out of a misguided effort to cut as few people as possible.

In the process, they lost their key engineers who were holding things together. They sent a message to everyone that incompetence is tolerated if you know the right people. And they lost even more core engineers who quit in the months after those layoffs.

Everyone makes hiring mistakes. It’s how you respond to those hiring mistakes that will seal the fate of the company.

Yep, this very much resonates with my experiences.

At the end of the day, startups are run by people, who generally prefer to work with their friends, avoid conflict, etc. There's no great mystery. The mystery is when things work well.

Thanks for your comment. Totally empathize with your experiences there.

Ray Dalio talks about this in his book "Principles."

The specific advice he offers is "hire slowly, fire quickly."

Terrible advice (from a broadly terrible book, I hasten to add). The reason that this is terrible advice: if you "fire quickly", it is because something is either grievously wrong (a mishire) or you are firing based on limited evidence. If the former, you have a hiring problem, not a firing problem; if the latter, you will generate a fear-based culture. Now, if you're running a prison, a fear-based culture may be exactly what you're after -- but fear is anathema to innovation, and if your endeavor requires any creativity whatsoever, you should be seeking to build mutual trust, not foster institutional fear.

It's very old school and discounts how many problems can actually be corrected faster and less expensively than by firing ASAP.

The reason "fire quickly" may be appealing advice to some is that solving problems takes effort without a clear guarantee of return, and leaders usually end up trying easy solutions that diffuse blame or create the illusion that something has changed. Then they wonder why productivity is not up or why employee sentiment is middleing.

About your point 2, can you summarize what you heard about Bridgewater Associates from people who were there? I also stopped reading the book, probably further in than you did, and I felt uneasy about Dalio's description because it seemed internally inconsistent given rudimentary knowledge about working environments and their psychology. He felt like a good boss because people wanted to work at Bridgewater ($$$) and nobody criticized him much - but probably, people had reason to do so but just didn't dare to.

I also wonder what their actual competitive advantage was. My guess is Dalio himself had a good way to think about economic questions, and that they used not-too-simplified computer modeling before most others.

Could you expand on your other criticisms of the book? How does it conflict with your experience? I'm still learning.

I honestly think the book is so bad that it's not worth a lengthy critique, but in short:

1. Dalio doesn't understand what a "principle" is -- but I can understand that "Aphorisms, Cliches and Hunches" is a less arresting title, if much more accurate. (See [0] for a fuller review on this.)

2. Dalio's version of Bridgewater doesn't line up with the experience of others -- which I have heard from so many people as to completely undermine whatever he might say.

Now, in the book's defense: I didn't get through it and perhaps it got suddenly palatable or interesting. However: I also couldn't get through it -- it was just that bad.

[0] https://www.goodreads.com/review/show/2233988523

I agree that his descriptions are less "principles" and more like "heuristics". The overall message of the book, as the referenced reviewer points out, is "do what's sensible." As someone so young, what is sensible to me is not obvious, so I find value in this.

What, in your opinion, defines what is sensible in business and leads to your frustration with Dalio's message? Can you give personal anecdotes?

I think I would point you instead to my beliefs about principles[0], values[1], and (because you are young), the promise and peril of youth[2].

[0] https://www.youtube.com/watch?v=9QMGAtxUlAc

[1] https://vimeo.com/230142234

[2] https://www.youtube.com/watch?v=VzdVSMRu16g

In Germany it is very hard to fire people but there is a six month period in the beginning, where one can be fired without reason. Is it possible to gauge a new employee during that timeframe?

I would say you can generally (from my experience >95% of the time) identify a bad hire in roughly a month, mostly in two weeks and then give yourself / them additional two to be very sure.

We just hired for a management position a couple of month ago and I could tell from the very first meeting that it was a bad hire. I made sure with my team that I’m not totally wrong and then communicated my doubts to the C-Level. It took some time because they wanted to give them a real chance but just before the probation ended there was an evaluation meeting and the feedback was, without exception, negative. Took two days and they were gone.

Of course there will be hires that can uphold their charade for six month but I would say that’s an exception.

If you can tell from the first meeting, why was this person even hired in the first place? The only time i experienced something like that was when the CEO hired someone without asking anyone else to vet them.

Some people are just good at interviews or talking themselves up.

Back in university, most of the students in my Chemistry course had A-Bs (grades were published publicly). The final for the course though was set up by some national body (in the US), and all but a few in the class got no higher than a D. Why? Because the national test was reflective of what students actually learned. The typical university multiple-choice test just self-selected good test takers. I myself got in the habit of only attending certain classes once a month because I knew how to game the tests and still walk away with an A-B average (e.g. have a good idea of what will be tested, know the material well enough that you can eliminate 50% of the false answers, and then make an educated guess on the rest.)

The same is true in hiring. It can be easily gamed if you don't have a great interview process (most companies don't). Even worse, part of that is by necessity. Each candidate has a different set of experiences, but the interview is made to be as routine and consistent as possible to weed out any potential biases (e.g. candidate given purposefully hard question or colored feedback because interviewer didn't like them). To truly vet a candidate, you would need situational questions and feedback, like they quickly glossed over some part of the question, so I'm going to go off-script and drill down into this area. Big companies especially run far away from that due to risk of discrimination lawsuits.

You answered it yourself, no? The people who could vet them were not involved. And the reason doesn’t have to be malicious, it’s just that not everybody can be involved with every interview.

Not only that but you run into the very expensive reason why literally every large company has a lengthy documented process for firing (outside of layoffs of course, lol):

Lawsuits

Honestly, european common approach of "trial period" is better for this.

Details vary, but for example in Poland you can (simplified case):

1. Hire for fixed-length term of a year 2. First 3 months of that are "trial period" - you have minimal paperwork for firing during that time, effectively no chance of lawsuit (if someone brings a lawsuit that gets far enough for any paperwork to reach you, you have much worse things to take care of internally) 3. After the fixed-length period, if you're happy with the employee and want him to continue you switch to "permanent" contract. If not, the term lapses and that's it.

The problem (I’m not in Poland but I’m in Berlin, which also has strict rules about firing long term employees) is that senior talent has a lot of choice of where to go to so why should they bother with a place that would only give them a 1-year contract at first?

If you go with permament contract from the start, the corporate still gets 3 months of trial period where they can just fire you at will.

A mishire situation is what usually this advice is about. Maybe if you hire only people you previously worked with you can bring the mishire rate way down but for majority that rate will probably be very high is what I commonly hear.

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