I really would like to challenge the conventional wisdom of the “hire slow, fire fast” principle. I’ve never personally followed this advice, but only after hearing Ben Horowitz talking about it, did I realize why my gut instincts were credible.

Hire slow… I don’t think it works because you’ll never know until you let the person start and do the job. Then you’ll know within the first 3-4 weeks if this is the right fit. That’s why companies have probation periods. One can argue that “hiring fast” and then letting the person go several weeks after would not be fair for the new hire because they would have to resign from their previous job and could be left in a very uncomfortable position. In my opinion, if it takes longer than 8 weeks to get all the interviews organized and then another 4 weeks to make a hiring decision, the hiring team likely does not need the person or does not like the person that much… or… they are just indecisive as an organization, and the new hire should really question whether they want to join this slow boat to China. 🛶

The reason why hiring decisions in FinTech compliance are very unreliable is that most FinTech executives don’t really know how to assess the right fit. CEOs often make the mistake of hiring their compliance leaders based on the person’s regulatory knowledge and past experience, and ignore the fact that over 80% of success in FinTech compliance depends on attitude and risk appetite and has nothing to do with regulatory knowledge. 💡

The advice to fire slowly is also not very practical. First of all, the vast majority of the compliance leaders resign on their own initiative, they rarely get fired. CEOs are awkwardly uncomfortable when they don’t like their compliance leader, but instead of firing them, they begin ghosting them, excluding them, and minimizing their interactions. Compliance leaders feel it very quickly and start searching for new jobs.

In my experience, managers know very quickly when someone is not the right fit for their team, and the reason why they don’t fire the person has nothing to do with the person being fired. In many cases, firing is delayed because the hiring managers feel personally uncomfortable when they need to admit that their hiring decision was bad, they hate the idea of going through the motions of another hiring and reallocating the workload. My observation is that good efficient and competent managers need fewer people and they don’t internalize or personalize the need to fire poor performers. They rarely blame the person, and more often just see objective reasons why someone is simply not the right fit.

Incompetent managers overhire to compensate for their own weaknesses, they also have a tendency to hire the wrong people for the wrong reasons. Very often underperforming managers would argue that they need a lot of very narrow specialists within their teams, and, at the same time, they usually have a hard time reconciling workstreams and coordinating projects within their teams. What looks like poor performance by individual contributors could very well be the consequence of poor management.

So, my objection against firing fast is that competent managers would not have a tendency to delay necessary firing. Incompetent managers may have a tendency to delay firing, however, it won’t solve the bigger organizational issue of not having the right leader in the first place.

What is your take on “hire slow, fire fast”? Do you agree or disagree? 🤔

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P.S. I am happy to announce that the “FinTech Startup Compliance Pro” Certification received its formal accreditation and the next cohort of students will start in a few weeks! This Certification was formally accredited by the Continuous Professional Development agency as a program that meets the requirements of this leading international institution responsible for assessing and certifying professional educational programs. The goal of this program is to transfer the focus of the compliance professionals from being primarily information providers recommending decisions into pragmatic results-focused executives able to set up and manage compliance as a revenue-generating function. You will be trained on how to set and manage any and all aspects of FinTech compliance, including:

• Organizational structure. Hiring and firing principles
• Setting Revenue-generating objectives for the next year
• Making ROI-based resource needs estimatesDefining KPIs for all key compliance areas: new products, AML, risk management, reporting, outsourcing, funds safeguarding, and governance

Click here to find out more! ✨