To quote Green Day, “It is sometimes unpredictable, but in the end it’s right.”

Every year, many owners (or partners) of advisory businesses, sometimes even founders, are asked to leave their firms for reasons ranging from underperformance to poor relationships or disastrous mistakes they have made.

As painful and difficult as that may be, sometimes the only course of action left is to ask your partner to leave your firm and “don’t come back no more” (Ray Charles this time).

If the situation has escalated to this point, the decision is also usually badly needed for the organization to continue to grow or even survive.

The reality of larger partnerships is that being an owner does not mean you are guaranteed employment for life. In fact, as firms grow larger and add more owners they recognize that there are many reasons to fire partners. What’s more, the management process and ownership agreement of the firm should anticipate this and allow it to happen. Even though firing a partner is painful, keeping one who should be gone can be fatal.

The Problem

In my experience, there are usually four reasons a partner needs to be fired—poor job performance, poor relationships, problems he or she faces outside the firm, or for cause. Let’s examine each in turn.

Performance

Partners in most firms are entitled to significant benefits, including compensation, but those come with very high expectations for a partner’s productivity and contribution. A firm can’t offer one without the other. Yet sometimes, for one reason or another, a partner falls behind, and the drop in output may be so significant that the only way to deal with it may be to ask the person to leave.

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