Latest / Hiring & Firing with Fexingo: Recruitment, Performance, and Workforce Decisions / How One Company Fired Its Way to a Better Culture
Transcript
- Lucas: So there's a story that's been rattling around in my head since I read it a few weeks ago. A mid-stage tech startup — about 200 employees, just closed their Series B — decided to fire sixteen people in one day. Not for performance. Not for misconduct. For culture. Luna: Sixteen in one day? That's eight percent of the company. What did they do, hire a firing squad? Lucas: Pretty much. The CEO, I'll call her Sarah, had been noticing a pattern. A handful of people were technically excellent — hitting all their OKRs — but they were toxic in meetings. Undermining colleagues, hoarding information, rolling their eyes when someone asked a question. And it was spreading. Luna: Right, the classic 'brilliant jerk' problem. But most companies just tolerate it because the output looks good on paper. Lucas: Exactly. And that's what Sarah had been doing for about six months. But then she did a culture audit — actually surveyed employees anonymously — and found that the teams with those high-performing jerks had thirty percent lower engagement scores. People were quitting those teams twice as fast. Luna: So she decided the cost of keeping them was higher than the cost of firing them. That takes guts. Lucas: It does. But here's the part I find really interesting. She didn't just fire them and hope for the best. She prepared a one-page document for each person, detailing specific behaviors that violated the company's stated values. And she gave each person a full severance package — three months — plus outplacement support. Luna: So she was fair about it. That probably made the rest of the team feel safer, not more scared. Lucas: That's exactly what happened. According to Sarah, the Monday after the firings, the office was buzzing — but in a good way. People were relieved. A few came up to her and said, 'I was thinking about leaving because of that person. Now I feel like I can stay.' Luna: That's the thing about not firing toxic people — it sends a signal that their behavior is acceptable. And the good people start looking for the exit. Lucas: There's actually some recent data on this. Gallup published a survey earlier this year — 2025 — looking at psychological safety. Teams with high psychological safety reported twenty-seven percent lower turnover. But the flip side is that one toxic person can destroy that safety for an entire team. Luna: Twenty-seven percent — that's massive. So Sarah's move probably saved her from a bigger turnover problem down the road. Lucas: And it's not just turnover. The same Gallup study found that teams with high psychological safety also had twenty-one percent higher productivity. So by firing the eight percent who were undermining culture, she likely boosted the remaining ninety-two percent. Luna: Okay, but let me push back a little. Firing people for 'culture' can be a slippery slope. What if a manager just doesn't like someone's personality? Or uses 'culture fit' to get rid of people who are different from the majority? Lucas: That's a really fair concern. And I think the key is that Sarah didn't fire people for being different — she fired them for behaviors that directly contradicted the company's stated values. She had a values framework that was specific and measurable. For example, one of their values was 'share openly.' So if someone was hoarding information, that's a violation. Luna: Right, so it's about behavior, not identity. But how many companies actually have values that clear? Most are vague like 'integrity' or 'innovation.' Lucas: That's the problem. If your values are generic, you can't use them as a basis for termination. But if you've done the work to define what they look like in practice — like 'we answer questions within 24 hours' or 'we give credit to others' — then you have a real standard. Luna: So the firing itself isn't the lesson. The lesson is that you need to build the framework first. Lucas: Bingo. And I think that's what separates a culture firing from a witch hunt. Sarah documented behaviors over months. She gave feedback. She put people on improvement plans. The firings were a last resort, not a first response. Luna: I want to come back to something you said about the relief on the team. I've seen that firsthand. At a previous company, we had a manager who was a brilliant salesperson but constantly belittled junior reps. When he finally left, the whole team seemed to exhale. Within a quarter, our sales numbers actually went up. Lucas: That's the paradox. The person who seems irreplaceable because of their numbers is often the one holding the team back. A 2023 study from Harvard Business School looked at over two thousand employees and found that replacing a toxic worker with an average one increased team productivity by about twelve percent. Luna: So the average person ends up being better than the brilliant jerk. But I think a lot of leaders are afraid of the short-term pain. If you fire a top performer, your numbers might dip for a quarter. Lucas: And that's the trade-off. But Sarah's story shows that if you're transparent about why you're doing it, the long-term gain outweighs the short-term pain. She told the whole company in an all-hands: 'We are choosing to protect our culture because that's what will make us successful in the long run.' Luna: It's a leadership signal. And speaking of signals, you know what I appreciate about shows like this? That we can have a nuanced conversation about something like firing without it being sponsored by some recruitment software company. Lucas: Yeah, that's intentional. We keep the show ad-free because we think the topic deserves clear, unsponsored thinking. If you find that valuable — if these conversations have shifted how you think about hiring or managing — there's a simple way to support that choice. It's buy me a coffee dot com slash fexingo. Luna: No pressure, just an option. And it genuinely helps keep the podcast independent. Lucas: Right. So back to culture firings. I think the other risk is that you create a culture of fear if you fire people arbitrarily. But Sarah's approach — transparency, documentation, severance — actually reduced fear. People knew the rules. Luna: That's the difference between a values-driven culture and a cult. In a cult, you get kicked out for thinking differently. In a values-driven company, you get kicked out for acting against the shared principles. Lucas: There's a good way to test where your company stands. Ask yourself: if your top salesperson violated a core value today, would you fire them by the end of the week? If the answer is no, then your values aren't really your values — they're just nice words on a wall. Luna: That's a tough question. Most CEOs would probably say, 'Well, let me think about it.' And that hesitation is the problem. Lucas: Exactly. Sarah told me that before the firings, she asked herself that exact question. And she realized that if she didn't act, she was telling the company that performance mattered more than values. So she acted. Luna: What happened after the firings? Did the company grow? Lucas: Eighteen months later, they've grown to three hundred and fifty employees. Attrition dropped by forty percent. And they've had no problem hiring — in fact, their offer acceptance rate went up, because candidates heard about the culture from current employees. Luna: So firing people actually made it easier to hire. That's the counterintuitive takeaway. Lucas: It is. But I'll add a caution: this only works if you have a strong, clear culture to begin with. If your culture is already weak, firing people won't fix it. You'll just have fewer people. Luna: Right, you need to know what you stand for before you can fire for it. So what's one thing a listener could do tomorrow to start building that framework? Lucas: Pick one value that matters most to your team. Write down three specific behaviors that demonstrate it and three that violate it. Share it with your team. Ask them if it rings true. That's the first step. Luna: I like that. It's small, but it forces clarity. And without clarity, you can't make the hard calls. Lucas: Exactly. And sometimes the hardest call is the one that makes everything else easier.