MBA2448 Don't Make These 3 BIG Team Member Offboarding Mistakes - The $100 MBA Show

Podcast Summary: The $100 MBA Show – Episode MBA2448 "Don't Make These 3 BIG Team Member Offboarding Mistakes"

Host: Omar Zenhom
Release Date: March 29, 2024

In Episode MBA2448 of The $100 MBA Show, host Omar Zenhom delves into the critical process of offboarding team members, highlighting three major mistakes businesses often make and providing actionable strategies to avoid them. Drawing from over two decades of entrepreneurial experience, Omar emphasizes the importance of handling departures thoughtfully to ensure both immediate and long-term business success.

1. Failing to Leave Team Members on a High Note

Omar underscores the significance of parting ways with team members amicably. Leaving on good terms not only preserves professional relationships but also opens avenues for future collaborations.

Example: Omar shares the story of Cindy, a foundational team member at The $100 MBA who left to start her own business. Years later, Cindy returned to manage the podcast, a transition made seamless because they had maintained a positive relationship.

“We were thrilled to have her back... if you hired them in the first place, they must be great talent.”
— Omar Zenhom, [04:15]
Influence of Felix Dennis: Omar cites Felix Dennis, founder of Dennis Publishing, highlighting the philosophy of always offboarding on a positive note.

“Always off board people properly and make sure you do it on a high note.”
— Omar Zenhom, [05:30]

Key Reasons to Leave on a High Note:

Potential Competitors: Maintaining friendly terms ensures a positive relationship even if the departing member starts a competing business.
Future Returns: Should the individual seek to rejoin, an amicable departure makes reintegration smoother.

Best Practices:

Celebrate Departures: Acknowledge contributions during team meetings, share stories, and express genuine well-wishes.
Maintain Open Doors: Encourage departed members to stay connected, fostering a network of potential future collaborators.

2. Neglecting Proper Offboarding Procedures

Properly managing the logistical aspects of offboarding is crucial to safeguard the business and optimize resources.

Access Removal: Omar emphasizes the necessity of revoking access to company tools, software, and physical assets systematically.

“Make sure you have a checklist so you cover all your bases and make sure people leave properly with no more access.”
— Omar Zenhom, [09:45]
Department-Specific Checklists: Different departments require tailored checklists to address their unique access needs.
Property Recovery: Ensure that all company property, such as laptops and phones, is returned promptly.

Consequences of Poor Offboarding:

Security Risks: Unauthorized access can lead to data breaches and other security threats.
Financial Implications: Unchecked access can result in unnecessary expenses from unused software licenses.

Implementation Strategy:

Develop Comprehensive Checklists: Create detailed offboarding checklists for each department to ensure all aspects are covered.
Assign Responsibilities: Designate specific team members to handle different offboarding tasks, ensuring accountability.
Systematize Processes: Automate where possible to minimize human error and streamline the offboarding workflow.

3. Overlooking the Importance of Feedback

Gathering feedback from departing team members provides invaluable insights for organizational improvement.

Exit Conversations vs. Surveys: Omar advocates for personal conversations over impersonal surveys to gain deeper, more honest feedback.

“Having a simple conversation... is so that you can improve.”
— Omar Zenhom, [14:30]
Sample Questions:
- What was your favorite part of working here?
- What improvements would you suggest for the company?
- If you were the boss for the day, what changes would you implement?

Benefits of Collecting Feedback:

Identify Strengths and Weaknesses: Understand what works well and what needs enhancement within the organization.
Enhance Employee Retention: Addressing feedback can lead to a more satisfying work environment, reducing future turnover.
Foster Continuous Improvement: Regular feedback loops promote a culture of ongoing development and adaptation.

Effective Feedback Collection Tips:

Conduct Exit Chats: Schedule informal yet structured conversations to make departing members comfortable sharing honest opinions.
Utilize Third Parties: Having HR or another neutral party conduct the interviews can encourage more candid responses.
Document and Act on Feedback: Transcribe and analyze feedback to identify actionable trends and implement necessary changes.

Additional Strategies for Successful Offboarding

Beyond avoiding the three primary mistakes, Omar provides further guidance to ensure a smooth transition:

Transparent Communication: Clearly outline the offboarding process, timelines, and expectations to the departing member.

“Make sure they know that... they know that they're being taken care of.”
— Omar Zenhom, [19:00]
Offer Support: Provide resources such as letters of recommendation, references, or training to assist in their next endeavors.
Maintain Ongoing Relationships: Stay in touch with former team members to foster a network of talented individuals who might rejoin or refer others in the future.

“Good talent is rare... reciprocity kicks in.”
— Omar Zenhom, [21:45]

Building a Cohesive Company Culture:

Omar concludes by highlighting that managing people effectively is one of the most challenging aspects of running a business. Creating a unified and adaptable culture ensures that the team remains resilient and aligned with the company’s values and goals.

“The people element is the hardest part of business. So if you get that right... you're going to be all right.”
— Omar Zenhom, [25:30]

Conclusion

In this episode, Omar Zenhom provides a comprehensive guide to offboarding team members, emphasizing the importance of:

Leaving on a High Note: Ensuring positive relationships for future opportunities.
Proper Offboarding Procedures: Implementing systematic processes to secure company assets and information.
Gathering Feedback: Utilizing departures as opportunities for organizational growth and improvement.

By adhering to these principles, businesses can navigate team transitions smoothly, uphold their reputation, and cultivate a robust, supportive work environment.

Learn More: For additional business lessons and resources, visit The $100 MBA Show.

Transcript

Omar Zenhom (0:00)

And we're back, folks. It looks like Jim from sales just got in from his client lunch and he's got receipts. His next meeting is in two minutes. The team is asking, can he get through his expenses in that time? He's going for it. Is that his phone? He's snapping a pic. He's texting Ramp. Jim is fast, but this is unheard of. That's it. He's done it. It's unbelievable. On ramp expenses are faster than ever. Just submit them with a text. Switch your business to ramp.com hey, welcome to the $100 MBA show where your business gets better with our practical business lessons. I'm your host, your coach, your teacher, Omar Zenholm. And in today's lesson, you will learn how to avoid the three big mistakes you can make when offboarding teammates. Offboarding your team members is just as important, if not more important, than onboarding them. When somebody on your team leaves you, whether they get fired or they decide to move on to another opportunity, you need to do it right. Not only for short term gain, but also for your long term future of your business. And I'll explain why. I'm going to explain what are the three big mistakes a lot of businesses make when it comes to offboarding team members. I'll share real examples from my own business, when I did it right, when I did it wrong, and give you some tips to make sure you nail your off boarding. There can be some serious consequences when you get this wrong. So let's make sure we get it right. Let's get into it, let's get down to business. One of your biggest jobs as an entrepreneur is recruitment. It's being a great recruiter, bringing the right people to your team so you can build an incredible business that adds a lot of value to people's lives so that you can earn an income, earn a living and change people along the way. But a part of building a team is losing teammates. Whether they again they get fired, they get laid off or made redundant or they decide to leave. And when they do leave, you need to do it right. One of the biggest mistakes, and this is the first mistake a lot of people make when it comes to offboarding is not leaving people on high note. You want to close the relationship right so you can leave the door open. One of our first hires here at the $100 MBA was Cindy. She was incredible at helping us create the podcast we have today. She was a part of the foundational team and she worked with us for a bunch of years. But after a few years, she decided to go out and do something for herself, build her own business. And this is going to happen. By the way, as a business owner, people learn from you. The A players may decide, hey, I want to build something for myself. And this happens, happens to us sometimes because we teach how to build your own business. It's part of what we do here at the $100 MBA. So some of that stuff rubs off sometimes and that's okay. So Cindy went off and built her own business. But a few years after that, she wanted to come back and do some creative work and work for us. And because we did this right, we closed off the relationship properly and left the door open. We were thrilled to have her back. And hey, if you hired them in the first place, they must be a great talent. So you would love to have somebody like that back in the fold. And Cindy's back with us, managing the podcast and doing a great job. I learned this from Felix Dennis, who is the founder of Dennis Publishing and the author of how to Get Rich, which is a book. I did a must read episode here on the podcast. Search for it on our website, 100mba.net, one of my favorite books of all time. But he teaches that you should always off board people properly and make sure you do it on a high note. You leave them on a high note for two reasons. Two scenarios could happen. Number one, they can start a competitive business to you and it's better for you to be on friendly terms with that person if they're a competitor. The second option is that they go out, try something, it doesn't work out for them and then they want to come back. You don't want to make it awkward for them to come back. You want to make it easy for them to come back and that's why you want to celebrate them. And that's why when we say goodbye to our team members, no matter what the reason is, we like to celebrate them a bit and, you know, give them a shout out on our all hands meeting. When we meet with the team, we recognize their value, we thank them for their contributions. We maybe even show a few pictures and share a few stories and we say thank you. We make sure we close out properly and say, hey, we wish them all the best and be genuine with that because, hey, we do wish them all the best and we want to see them win because one day you might see them again. It's a small world in business and hey, you want to have the reputation of treating people right. Mistake number two, that People make is just forgetting to off board people properly. When you onboard somebody, when you hire somebody, you give them access to a bunch of stuff like an email account, you know, access to software and tools, maybe even physical things like a laptop and a phone if they're in sales or something like that. But when they leave the company, a lot of people don't have a system to make sure that they don't have access to those things. Again, they hand those things properly, or I should say hand over those things properly. And what we like to do is an off boarding checklist. And we have a specific checklist for each department. So there's a different checklist for engineers versus you know, support staff versus admin staff. The reason why we do this is because, you know, every department will have access to different tools. And by having a checklist and somebody responsible for each item, like say for example, the accountant is in charge of making sure that they get their last pay and they're off the payroll from that point on. You know, maybe somebody's in charge of removing access to their company email by having an offboarding checklist. You make sure you cross all your T's, dot your eyes, and that way there are no leaky areas in your business. This could be a serious security threat for your business if you mess this up. So make sure you have a checklist so you cover all your bases and you make sure people leave properly with no more access and they give up any property that they need to give up from the business. This is also good advice just for practical reasons, to save money on tools. You know, a lot of these software tools charge per user. Remove their access, don't give them access anymore, so that way you don't get charged for their usage. Save some money, and if you don't have a system, you don't have a checklist. This usually doesn't get done properly. A lot of people just focus on the onboarding, not the offboarding when it comes to access. Also make sure there's a system to hand over any materials or any work procedures or any tasks that a person's working on before they leave the company to somebody else in the company, whether that's a new hire or somebody else in the department. Make that the responsibility to the person that's leaving. Make sure they know that this is what they have to do before they leave. This is what they have to hand over. This is what they have to record or have to document before they wrap up their last day at work. Third big mistake that people make is not getting feedback. When somebody leaves your company, they have a lot of knowledge and experience of working with you, for you and in your organization. It's amazing what you can learn by having a simple conversation. A lot of people, they do is they like an exit survey, where they send them a survey to fill out. But not a lot of people are gonna take that seriously. And you're not gonna learn as much as if you just have a conversation, a 15 minute conversation with this person. Sort of like an exit interview they call it, but I like to just call it a chat. And usually in that chat, I spend a few minutes thanking them and wishing them all the best and learning what's next for them. And then I ask some simple questions, like I'm interviewing them on a podcast and I just say, what was your favorite thing about working for us? And what are some of the things that you'd like to see improve? Or what are the things that you would tell somebody who's new to the company to look out for how to be successful? I sometimes ask the question, if you were the boss for the day, for the whole company, you can make any changes you want. You had a magic wand, what would those changes be? Now, I used to personally do these interviews myself, but then as the team grew, I actually had somebody else do these questions. And sometimes that's even better because maybe somebody be more forthcoming and a little bit more honest and not feel embarrassed if the owner of the company is not asking these questions and somebody else, maybe from HR or an admin person, and then they can record all the answers. You can even record the call if you want to, and then transcribe it to make it easy. But the point of the conversation is so that you can improve. If they're just saying good things, okay, great, double down on those things. But you want to learn what you can do better and how you can add more value to your team members. Getting feedback is so important. Even if you just get one little thing, one little nugget from one person, it's going to be worth a lot. Because it's very rare to find somebody that has worked in your company and then is moving on to somewhere else. They're seeing both sides of it, how it is to be in the company and out of the company at the same time. So their perspective is actually really valuable and can help you attract the right people, keep the people that you love on your team happy and employed with you, and just overall have a better business that your team members will love working for. Got a 7am meeting on a Monday, expensing breakfast because it's in policy. Yay. Wasting all afternoon submitting an expense report for that breakfast. If your company used Ramp, you could submit expenses with just a text. Yay. Free your team from expense reports today. Switch your business to ramp.com all right, so those are the three big mistakes. Let's recap real quick. Number one is not celebrating them when they leave. Number two, making sure they're off boarded properly with an off boarding checklist. And. And the third one is getting feedback from that person that's leaving. Now, one of the things I like to do when I learn that somebody is leaving or when we have to have that conversation where we tell them that they're not going to be working with us anymore, we're firing them, is I try as much as possible to actually communicate more with them, whether it's through message or through their manager or make sure that they know that, hey, we're going to support them through this transition. We're going to help them out. Whether that's letters of recommendation or references or training or resources they need to do well in their next position. I know that sounds strange, but I want to make sure that I finish strong with anything I do. And that includes a relationship with an employee. I want to let them know what's going to happen. Hey, this is the, you know, the last few weeks are going to work. This week you're going to do this, the next week you're going to do that. This is how you're going to close off your last day, this is how you're going to get paid. This is your last payment, all that kind of stuff so they're clear and they know that they're being taken care of. You want to be as professional as possible about this and make sure they know that, hey, even though our working relationship is going to come to an end, we're going to do it right. Another tip I want to share with you is when it comes to after they leave and they're looking for work, maybe, or maybe they're in a new job and they need some feedback or help, I like to stay in touch with teammates that have contributed positively to our business. I get their email, I get their social media and I like just to check up on them maybe every once every six months. How are you doing? How's the new job? What's going on? Can I support you in any way? Do you need a phone call or recommendation for a promotion in the job you're about to go into or in the company you're in. And the reason why I do this is because good talent is rare. And if they're good, I want to just stay in touch so that when they're looking for a new challenge or they're looking for a new opportunity, maybe something will open up in your company. A new position, a new role, something that would be perfect for them as they have grown in other capacities in other companies to keep that door open again. Sometimes I just know that there's a good role in another company. A friend of mine's company, my network, another fellow entrepreneur, and I tell them about it. And then what happens is that the law reciprocity kicks in. And then one of my friends, one of my colleagues in business does the same for me when I have an opportunity, when. When I'm looking to hire somebody. So just because our working relationship is over doesn't mean our relationship is over. I can continue to contact them and make sure they're okay. And also, I'm just really concerned about making sure they're all right as people. Well, there you have it, guys. You want to avoid these three big mistakes like the plague, but you want to make sure you do it right and do the right things that I mentioned, the right practices, and you be as professional as possible. Finish strong is what I say. Make sure that you show this person that's leaving that no matter what the circumstances are, you're gonna do what's right. That wraps up today's lesson. Thank you so much for listening. If you love this podcast and you wanna support us, the best thing you could do is to subscribe to the show, to follow us on Spotify or Apple Podcasts. We're on every player, every podcast app, so whatever you like to use, go ahead and follow the show right now. Thank you so much for doing that. Before I go, I wanna leave you with this. One of the hardest things about running a business is people, is managing people, is working with people, because people are different. People have emotions, people have ideas, opinions, ways of thinking. And you need to adjust and adapt and be flexible with that. But also you need to create a cohesive culture in your own company that people have to fall in line with. So I would say the people element is the hardest part of business. So if you get that right, if you work on that on a regular basis, you're going to be all right. Everything else is quite easy in comparison. Thanks so much for listening and I'll check you in the next episode. I'll see you then. Take care. Got a 7am meeting on a Monday Expensing breakfast because it's in policy. Yay. Wasting all afternoon submitting an expense report for that breakfast. If your company used Ramp, you could submit expenses with just a text. Yay. Free your team from expense reports today. Switch your business to ramp.com.