Viral Layoffs: A Digital Dilemma at Cloudflare

0:00Your supervisor got fired. The whole sales department sucks. We're going digital instead of that. We're putting AI to replace all of you. It could be a million reasons. We just don't have the money to keep paying you. But when you say something as far as a reason, it creates a big challenge. How much more successful would you be if you had lunch once a week with insanely successful entrepreneurs who share their biggest secrets on how they think and achieve success? Grab your seat at the table because this is Business Lunch with Roland Frazier. and Ryan Dice.

0:36Welcome to another episode of Business Lunch. And today's a snackable episode with Roland where he's going to get into some more tactical strategies that you can start using to live a rich and happy life. If this is the first snackable episode you're hearing, I'd encourage you to go back and listen to some of the other episodes that Roland has put out. And if you want to get notified every time we release a new episode, go to the new businesslunchpodcast.com website and we'll send you detailed notes along with every episode. That's businesslunchpodcast.com www.businesslunchpodcast.com and you can sign up for the free email newsletter where you'll be able to get all the highlights and resources from the episodes.

1:11Hey everybody, Roland Frazier and Ryan Dice here with another episode of the Business Launch Podcast. It is good to see you, Ryan, after not seeing you for minutes and minutes and then not seeing you for minutes and minutes before that because we've been together for like two weeks now. How are you doing? Two weeks. I'm definitely sick of you. I'm definitely ready. I'm definitely happy to be done with all of the events. But you know what I'm most happy about? I'm most happy about the fact that I didn't get fired or I didn't fire somebody live on social media. Did you see this thing? This whole TikTok, this deal that blew up on TikTok and Instagram where this woman who worked for Cloudflare got laid off and filmed the whole deal?

1:51I did. and unrelated. Did you see the little 15 minute meeting pop up on your calendar a few seconds ago?

2:00Awkward. Yeah, I guess she, she saw that they were firing people and then she saw the 15 minute meeting come up that she wasn't expecting with people she didn't know from Cloudflare and she figured it was going to happen. So she thought that it would be nice to record it and, um, and see what happened. Um, do you want to play it first or do you want to talk about that? I think we just play it. I mean, that's the setup, right? Somebody gets fired, they're filming it. I would love to talk about it on the other side, just so everybody's got the context. All right, let's see if our highly technical crew here can make things happen, because I know you and I can't.

2:39Hey, Brittany. Hi. Yes, I'm so sorry. My name's Rosie. I'm just joining the call. Nice to meet you. my HR team.

2:54Hi, Brittany. Hi. Good way to start. Thanks for meeting with me and Rosie. We have an important meeting today. We finished our evaluations of 2023 performance. This is where you have not met Cloud Player expectations for performance. We've decided to part ways with you. Yeah, I'm going to stop you right there. Sure. Um, so I started August 25th. I've been on a three month ramp and then it was three weeks of I like she can self-assess very well. Um, I have had the highest activity amongst my team. I will tell you, managers should be there during the firing. Well, I have ideas on why they didn't.

3:45What I get a kick out of that she's a salesperson and she hasn't sold anything, but she's decided that she's done a great job, but it's been a month and she hasn't sold anything. Let's keep going. She said three-week ramp. Every conversation I've had with him, he has been giving me nothing, but I am doing a great job. I I have had great activity. I have really great meetings. I'm picking up the products very quickly and things have been going really, really well. I make really great relationships with my clients. So I disagree that my performance. So it's three months she's been there and hasn't sold her yet.

4:24I mean, I get there's holidays, but it's still a sales job. We'll talk about that. Yeah. Certainly have, just because I haven't closed anything officially. Officially, which means she hasn't officially made any money for the company doing this and not my manager not you know we've never met so this seems a little odd that my manager has no idea that this has been happening and the director has no idea that this has been happening so i'm just definitely confused and um yeah i would love like an explanation that makes sense 100 um real quick Let me carve out the two threads, a ladder of why I'm on this conversation.

5:05I'll put that one in the second half, and Rosie might be better to explain. Kind of get the, I don't know how long you want to let her run. I think we get the idea. Yeah, it doesn't get better. She goes on to say that she wants a specific reason, and is she being fired for no reason, and things like that. And then I guess she's gotten quite a bit of support. And I don't know what other feedback has come. I haven't had a chance to read the comments. I saw it this morning. And I guess you want to start with the way that they chose to do it and her response. What do you think? What do you want to do?

5:50Yeah, I mean, I think something doesn't go this viral. it really does take both people to kind of do something kind of screwy for something to go this viral. And when I think about it, I think she's absolutely correct. I don't love the idea of somebody's manager not being on. I get that sometimes that happens, especially if the manager themselves are let go, then definitely that can happen. But to have it just be somebody from HR and nobody from that management team to be able to say that, I think that's a bad look. And even the CEO came out and said in a Twitter post, like, that's not okay, that shouldn't have happened.

6:24So okay, mistakes happen in, you know, in firing. I think the bigger issue is that when she said that it was a surprise that all of her one on one, she'd gotten good feedback. That's definitely not okay. I'm a big believer that if somebody is getting fired, like not just a layoff, like, but even then, there should be no surprise. People should know going into this, I actually wrote a blog posts, how to fire people with fairness and dignity, where that outlines a process for how you should go about doing this. And kind of rule number one is no surprises. That being said, again, just from an obviousness perspective, if you do have somebody who's been in sales for that period of time, even if there are holidays, it seems like it's probably not working out if they've literally made zero sales.

7:08And most folks who are in sales, they understand that when you're hired for a role, if you don't make any sales, that's kind of a make or break type thing. So I think it goes to her supervisor that I think a lot of people are uncomfortable with conflict and the supervisor needs to have the training to be able to give constructive feedback, which includes criticism. You know, like if you, there's got to be like, they have to be listening to calls or having sales meetings. She said she had gotten feedback. So they're good at giving feedback. It's just that if it's all positive, I absolutely understand why she was totally surprised.

7:50And as far as having the, so I think, you know, we can talk about that. I think that she was reacting. I'm not sure if it would have been better to give her more notice or not so that she didn't have to be in the kind of half angry, half disappointed state that sometimes happens when you're let go. And then to have two people telling her that she failed to meet performance expectations, but she wasn't aware of it goes to, it just seems like some mismanagement there. I could definitely see that in a company like that, why they would have HR do it versus the supervisor because of legal liability reasons that they have a process that they go through and these people were letting go lots of people so they basically said this is our process we're going to contain legal liability by doing it this way it sucks but having you know having seen the legal side of things as well it really you you really don't want to give any more information.

9:04And if she had a relationship with the supervisor, they may have been concerned that the supervisor would have said, yeah, it does suck. And you were doing great and blah, blah, blah. And, and completely supporting that position, she chose to record this call separately, which interesting. I'm not sure on the legality of recording is like a zoom call and publishing it because there are dual consent States and single consent States. So that's an interesting thing that she could potentially create liability for herself, violate the law there, particularly to have the two supervisors, you know, be broadcast.

9:42But on the other hand, why did she record it? Did she record it to create a potential legal claim against them? Did she record it so she could plan on putting it on TikTok? You know, it's like, and what does that say to her future employability? Because I'm never hiring that person. Like, you know, I got to think that the, you know, I don't know how many views it got, but it was a lot, right? I got to think that any employer that sees that goes, man, that's very contentious. And sometimes things don't work out. Like in terms of the giving a reason, we never give a reason because it's just your services are no longer required.

10:21If you give a reason, then you can potentially destroy your at will employment and create a liability because that now there's a, an argument that somebody can make as to, you know, well, you said this, but I, you know, I did that and now you can fight about it. It's if you just basically say in most States, they're at will employment, you can fire anybody anytime for anything. You didn't meet expectations, uh, is actually more information than I would give to. And also kind of seems blamey, but, um, but your services are no longer required. It was like, Well, I need a reason. Think about this too, though.

10:54As an employee, if you're working, people get fired for no reason all the time. We mismanaged our cash. Your supervisor got fired. The whole sales department sucks. We're going digital instead of that. We're putting AI to replace all of you. It could be a million reasons. We just don't have the money to keep paying you. But when you say something as far as a reason, it creates a big challenge. So I'm with you on the I think it could have been done in a better way. I don't think she should have been surprised. And I think that there's definitely things they could do better. But like for everybody that's an employee, I would say you're probably not going to get the honest conversation as to the real reason ever because it just creates too much liability for the employer.

11:40Yeah, you're not. So I'm going to attempt to give advice to the folks at Cloudflare, even though they're a bigger company than, you know, mine. But I'm going to do my best for the sake of everybody else. If this happens again, make sure the person should not be. I mean, any time I have unfortunately had to let a number of people go. I've also had managers reporting into me that they wanted to let somebody go. My first question, if a manager comes, hey, we need to fire this person is, OK, I understand. Are they going to be surprised by this? And if the answer is, oh, well, you know, then it's like, OK, well, then here's what you need to do.

12:15You need to go put them on a performance improvement plan. And probably if they've been working for you and this has been an issue for a while, you should have done this a while ago. And so I want you to put them on a performance improvement plan. And here's what that looks like. You know, and we've got a whole process for that where they're going to basically be strictly like micromanaged and need to hit certain objectives. They're going to be informed that if they can't hit those objectives, then that'll be it. Right. And it's theirs to win back. And it doesn't necessarily mean that this is how we've had plenty of people go on performance improvement plans that did improve their performance and become absolutely frigging rock stars.

12:46Yeah, I would talk to the manager about doing that. And then I would let the manager know you're going to be put on a performance improvement plan because you're not doing what you need to do as a manager. Assuming, of course, we had taught them how to do that. And so all of this assumes before you let somebody go, the first question to ask is, did we put them in an environment to succeed or is this our fault? If it's your fault, then you need to make the correction on your end, have a conversation with a team member about how you're not performing. We believe it's on us. Here's what we want to do to support you and look to resolve it.

13:16At that point, if it's clear that it's on them, then there's a corrective conversation, performance improvement. And then if that's not working out now, it's, hey, unfortunately, today's going to be your last day at the company. As we discussed before, those core metrics weren't being met. We can have a conversation, but I'm not going to say any more beyond that point. I do want to let you know that this is how it's going to work moving forward. And that's when you just get into the here. You can still apply for unemployment. Here's what your health and you just go into that. And if they if they keep asking, what was the reason?

13:49I can't give you any more. I agree with you. I want to give them all the reasons in the world. Yeah, you just can't. Yeah, you just can't. That's how it should have been done. we um had this happen as recently as a couple of weeks ago with one of our portfolio companies where there were um there were some people that needed to be let go and um they did not follow our advice which is and i learned this the hard way which is basically now this was a remote position and it sounded like she said it was a a three-week ramp in the thing but it said three months some other place so i'm not sure what it was she said she started in august so so she okay OK, so she she had three months to kind of prove herself.

14:32So she was already in a position that she knew was going to basically be maybe at the end we're happy and maybe we're not. So I think starting out contentiously is not going to help because I instantly want to fire you the minute that you start arguing with me and not letting me talk. So she said, let me stop you right there. You know, and I again had she had noticed and it wasn't a surprise. Maybe it would be better. But I think that just on both sides, you need to keep it as professional as possible, no matter how much you may feel it is wrong, you know, on either side. And and then there's the opportunity to ask for support.

15:12Now, in that environment, my guess is that there was no way that there was anything she could say that would get her job back. So the only thing she can do is basically have a negative experience. The people that are firing her, they don't have any authority. Their job is to fire 100 people or whatever. So I think it's important to think about that. Her way back in without having been contentious might have been to reach out and say, look, here's the status of all the calls I made. I know things didn't close, but I never got support on how to do that. Could I have a performance improvement plan?

15:44Would be probably the most productive question that she could ask, right? Which doesn't happen if you interrupt them. And so I gave advice to Cloudflare. I'll give advice to her. By the way, nobody asked for this advice, which I fully recognize. But from her perspective, as hard as it is, you got to hang in there and just hear it out. Especially, I'll tell you, I would never hire this person for a sales role because a big part of sales is keeping your cool when things get kind of tough. And I get that it's tough. It's one of the toughest conversations in the world. I absolutely empathize with the position.

16:15But when you're like, let me stop you right there, there is no going back from that. You just decided to light everything on fire. And it doesn't mean that they didn't, quote unquote, deserve it. But at that point, it's not about them. It's about you. And so for your own self-interest, let them speak. Let them be heard. You can always drop the nuclear bomb, which is why it should be your last. Go nuclear at the end, not 30 seconds into the conversation. It also goes to the importance of data on both sides, because for her, you know, you and I listening to it, we said, well, three months with no sale, no matter how much activity you have.

16:50You can have a lot of activity, but if your activity is not productive, ultimately our company lives or dies based on income. Income comes from sales. Your position is to sell. You didn't sell for a quarter of a year. That's a challenge. Now, if the sales cycle is six months, then they didn't give her a fair amount of time. And if you are going in, like if I'm her going into the job, get all the information as to what success looks like and what reasonable periods to achieve specific results look like so that you then have data to support? Because then all along you can say, hey, I'm three months in, but I know our sales cycle is six months.

17:31Where should I be? What are the leading indicators that I should be meeting to know that X percent of my quota is going to close within the normal sales cycle time? That would be a really good thing for you to know, because then if you're having conversations with your supervisor, you can be your own advocate, but you like what she did several times was she said, I'm doing a good job and I'm, and it's like, okay, but you don't have to decide that. Right. Yeah. That's not relevant at all. What you think. Yeah. The customers would disagree because there ain't none. Um, and so, but to your point, yeah, it does depend on that.

18:06The entire conversation was emotional and that's the nature of a firing. It just, it just is, I would just say both of them could have handled it better. Both of them could have done things differently for the employers out there. If you're listening to this, what you need to know is you need to assume that any time you are going into one of these situations, you need to assume the person on the other end is absolutely going to record it. And they're absolutely going to post it to TikTok. We just have to assume this. This wasn't, there was another one the same week who was laid off from discord and she did the same thing.

18:41And in this case, you know, didn't say anything negative about them. It was just a very kind of sad video. But I think this is the world that we live in. You need to assume that it's happening, which only means, by the way, you need to do what you know you need to do anyway. Right. I mean, this should just serve to keep us honest. I agree with you. I don't think it's necessarily right. Yeah. But maybe we're the grumpy old guys yelling at clouds. Well, I'll tell you what I will do, though, is I don't think the company and its policies and procedures were done correctly based on what we talked about and also based on the result.

19:16I don't think that I think that the company could have done it better and I think that she could have done it better. But I think the two people that we're interviewing who I believe were tasked with doing exactly what they did stuck with the policies and procedures, whether they agreed with them or not. And they performed perfectly within that because I didn't see them say anything that created liability. I saw them try to say, I understand. I know how you feel. Try to be empathetic, even though, you know, I think it was hard to sell. After you fired 26 people, the 27th, you're going to have a hard time.

19:50Totally understand how you feel. You know, it's just they they were maybe not quite as enthusiastically empathetic as they could have been. But but for them, the exact reason that you can't give all that information and the exact reason they needed to stick with their guns and not go off script was it was evidenced by the fact that she recorded it and posted it and it could have created all kinds of liability for him. So I think I think they did it right, even though it fell apart at the corporate level. I agree. And I'm glad that you said that because they caught the most flack in the comments.

20:24They were like called corporate drones. And, you know, the two HR people when at the end of the day, I think they were the only ones that they did. They did their job like it was supposed to be done. And you can say that's cool and say that's cold. And you can even say they're corporate drones and they and they might say, you're right. We were. But you know what? We're still employed. Yeah. Yeah. I did my job. This is what I do. What you do is sales. You didn't. What leadership should have done was lead. They did it. The only contingency in this whole thing that did their job was the one that got crap on the most.

20:59And I'm so glad that you said that because nobody else is defending those two people. I think they were put in a tough situation. It was their job. They did it, but God dang it. Y 'all get, have a firing process in place. People talk about, you know, the importance of hiring and having a good hiring process in place. What will make you great at hiring is getting good at firing. It sucks, but it's a critical aspect of the role. And the better you get at firing and the more you realize, okay, people come in, they cannot work out. We can send them on their way and it'll be okay. The more confident you'll be to make the hires in a timely manner.

21:35Yeah. And I don't know if they did or not, because we don't know if they didn't communicate to her when she was hired. This is a period of time where within which you're going to prove yourself to us. The expectation is that you will within this period of time close this many sales. Then you have an objective thing that you can point to and say three months. You didn't close. We expected we told you when we hired you. It was a temporary position. You could even go so far as to say, look, most of the people that we hire for sales don't work out because we're looking for very special people that can close deals.

22:09Doesn't mean you're good, wrong, bad person, anything like that. It just means that you're not right for the position. Most people aren't. We hope that you are. The only way for us to find out is to hire a number of people, put them out in the field and see how they do. So you're creating that expectation from the get-go that this is not like, she seemed to think it was like, I should be employed forever, you know, but that that's not the case in those jobs. We hire lots of salespeople knowing most will fail, but that's just the nature of sales. And so I think if they didn't communicate, they needed to, they may have, and she just forgot, you know, in the moment, but that's something else I'd say.

22:50It's true. We're crapping our manager based on one person's testimony. It's possible our manager was giving constructive feedback and sometimes people don't hear it. They don't listen. They don't remember it. But it just shouldn't be a surprise. Yeah. Just shouldn't be a surprise. Agree. So don't surprise people. And if you like this episode of Business Lunch, create a firing process, create a hiring process, keep people communicated with and share this with anybody else that you think might benefit from it. And we'll see you next time on Business Lunch.

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