Firing Underperformers

It would only be a morale nightmare if the decisions were made randomly (or for political reasons), and not based on performance/job fit. My experience is that people tend to view letting underperformers go as a positive. It's far more damaging to morale to keep the underperformers around.

Once a Japanese executive said, "It doesn't matter if you fire bottom 20%. Eventually the existing employees will form the new bottom 20%".

Some companies (e.g. Amazon) have a policy to fire the lowest performing x percent every year, even if the whole team is good, which makes churn inevitable. It also leads to odd situations like hiring low quality talent just to provide the rotating foundation your real team rests on. And of course constant in-fighting to stay out of the bottom x percent by sabotaging rivals if necessary.

Eh it's also a polite way of saying that they're getting rid of the worst performers. There's a balance. Firing bad employees can improve productivity and morale of those that remain. I'd say at most of the companies I've worked for there's been at least 4% of employees that we'd have been better off firing and rolling the dice finding a replacement.

You think the top performing 25% are going to want to stick around when you fire 3/4 of their coworkers?

In some companies it feels like they are firing the people that they could not easily get rid of otherwise - cutting of the bottom 25% of staff (based on low performance reviews or personal grudges).

That sounds like a great way to lose good employees.

We had to do this recently as well. You have to get rid of him. A poor performer in your staff will drag down morale and destroy productivity. Keeping him on will send the message that you don't care about performance.It is acceptable for you to fire an employee that is not performing at the expected level, in the same way it is acceptable for a new employee to leave after a short period of time if the job doesn't feel like a good fit.Removing him will assure everyone else at the startup t

Makes a lot more sense than firing the high performers, no?

Many companies in the US routinely fire the bottom 5%. If a company needs to fire a bad hire quickly, what exactly is the problem?