Matt Mochary (CEO Coach): How to Fire People With Grace, Work Through Fear, and Nurture Innovation | Lenny’s Podcast With Lenny Rachitsky

Key Takeaways

  • Is fear giving you bad advice?
    • “I believe that fear is actually giving you bad advice and I think you’re predicting that if you do this A will happen. Well, I’m predicting that if you do that, the exact opposite will happen.”Matt Mochary
    • He made this bet hundreds of times and so far, he’s never lost (Matt: 100, CEO clients in fear about the outcome of their decision: 0)
  • Anger destroys relationships. Anger is not a base emotion, it’s a mask for when we feel pain
    • Allow yourself to feel the pain, don’t push that out onto other people
  • Firing people can be brutal, that’s why you have to do it with a massive amount of compassion
    • The three most traumatic things that can happen to you: losing your spouse, your home, and your job
  • Avoiding difficult conversations?
    • Cognitive behavior therapy 
    • The best way to get over that is to have one and realize it’s not that bad
  • Let them go kindly and humanely
    • Become their agent, actively help them find their next job (don’t just offer to write a reference)
    • Reach out to people and recommend them, find what they are good at, find their passion
  • “I think for almost all managers that aren’t good at letting go, it’s because A, they’ve never done it, or B, they’ve done it badly.”Matt Mochary
  • The “top goal” concept (Greg McKeown) = massive gains
    • Create priorities
    • Focus on the one thing you can do today to move closer to your goals
    • Long-term goals with short-term critical moves
    • Set aside some amount of time each day that you just work on your priority
  • Why Matt has an accountability partner for his top goal time
    • “During my top goal time, I have somebody sit with me and they prevent me from doing anything but my top goal.”Matt Mochary
    • It’s the same idea as a personal trainer in a gym
    • More often than not they’re just forcing you to do something that you know you need to do
  • The biggest marker between a botched layoff and a successful layoff
    • How did they hear that they no longer have a job?
    • If it’s one-on-one, it’ll be okay
    • If they read it in an email, or a group chat, that is no good
      • That’s when people get angry and start complaining on social media and go to the newspapers. It’s not personalized, it’s dehumanizing

Books That Led Matt to His Coaching Journey and Software Platform

Intro

  • Matt Mochary (@mattmochary) is a full-time executive coach in the tech world. He worked with some of the biggest names in tech and finance, including entrepreneur Naval Ravikant and the CEOs of Notion, Coinbase, Reddit, and many others.
    • Matt Mochary and Lenny talk about the right way to fire an employee, how to recognize emotions like anger and fear, make people feel valued and heard, and how to make time for your “top goal”
  • Letting someone go or making someone feel heard
    • Follow the step-by-step script in the Mochary Method curriculum document
    • “I was like, oh my god, this is the most practical, tactical, useful document I’ve seen in a long time.”Lenny Rachitsky
  • Host: Lenny Rachitsky (@lennysan)

Areas Where Even Very Successful Founders Struggle

  • How strongly do people feel fear?
    • There are few people that Matt coaches that just don’t feel fear at all
    • Most people feel it to some degree (some more, some less), but when they feel fear, it prevents them from doing what is necessary
  • Is fear giving you bad advice?
    • “I believe that fear is actually giving you bad advice and I think you’re predicting that if you do this A will happen. Well, I’m predicting that if you do that, the exact opposite will happen.”Matt Mochary
    • He made this bet hundreds of times and so far, he’s never lost (Matt: 100, CEO clients in fear about the outcome of their decision: 0)
  • The reason he always wins is that when someone’s in fear, they can’t see reality
    • Their brain is making exaggerated predictions, they’re gripped
    • However, this does not mean that you should just do the opposite of what your brain is telling you to do
    • Especially when you are in physical danger. What Matt is talking about is things that we perceive to be a danger to our egos
    • Check with somebody else who’s not in fear about your situation because they will be able to see clearly
  • How to address people to minimize defensiveness
    • Matt’s wife lets him know he is angry:
    • “You’re in anger.” – this made him feel angrier
    • “Are you in anger?” – also made him feel angrier
    • “I perceive you to be in anger.” – was able to realize he is angry, there was no judgment

Anger Destroys Relationships

  • Anger is not a base emotion, it’s a mask for when we feel pain
  • Because our brain doesn’t want to feel the pain, it pushes that pain onto everybody around us 
  • Allow yourself to feel the pain, don’t push that out onto other people
  • Matt learned this very recently and he’s still not good at it

When and How to Let an Employee Go

  • The fewer people in the organization, the better things work
    • Less friction of information flow. Everyone wants to be informed and heard
    • Ideally, you want to keep the team super small (WhatsApp, Linear, Instagram, etc.)
  • Firing people can be brutal, that’s why you have to do it with a massive amount of compassion
    • The three most traumatic things that can happen to you: losing your spouse, your home, and your job
    • Trauma makes your brain shut down, you go into massive fear
  • Firing an employee is the most important skill to develop as a leader and a manager
    • The reason that most managers are not good at letting an employee go is that they think they’re hurting them (maybe they really need the job)
  • Separating the decision from the implementation
    • The decision
      • This is what Wei Deng, the Ceo of Clipboard Health shared with Matt
      • The customer is the stakeholder that you are solving for in a company
      • They want only the best employees
    • The implementation
      • Who gets hurt?
      • Employee gets hurt
      • You get hurt (painful conversation)
      • The rest of the team (their friend is leaving)
  • What can we do? For each person who gets hurt, what is it that they want?
    • The person fired wants a job where they are needed, feel fulfilled, and enjoy what they’re doing 
    • You are holding them back from what they want
    • What you do is help them find that place that needs the skill or the passion that they have
    • Become their agent (don’t just offer a reference for their next job)
    • “I want to help you discover what it is that your ideal role is, and I want to help you create it or land it.” – Matt Mochary
    • Reach out to people and recommend them, find what they are good at, find their passion
    • “I think for almost all managers that aren’t good at letting go, it’s because A, they’ve never done it, or B, they’ve done it badly.”Matt Mochary
    • If you are still friends with people you fired, that is a good indicator that the process is a humane one
  • Avoiding difficult conversations?
    • Cognitive behavior therapy 
    • The best way to get over that is to have one and realize it’s not that bad
  • For the rest of the team, let them share their emotions, let them share the sadness that they feel, and release it out of their body

How to Make People Feel Heard

  • What Matt does when trying to solve a problem in a group setting
    • Ask everyone to take 5 minutes and write down their solution
    • After that, they all drop it in a doc and Matt reads it
    • When he reads it, he thanks everyone individually
    • To make people feel more heard, he asks them to state their opinion verbally and then he repeats it back to them until they are sure he understood them
  • An even deeper way is for situations where people are attempting to give feedback that can be perceived as hurtful
    • People tend to polish their feedback, make it softer
    • It’s about what they are willing to say, not what they are thinking
    • The key is to reflect on what you imagine they are thinking; what are the thoughts in their head?
    • Almost always their thoughts are bigger than their words, and they really feel heard when you share their thoughts
    • Once you made them feel heard, you can accept or reject this feedback
    • If you reject, explain what’s going on in your world and why you can’t accept what they shared

What Is a “Top Goal,” and How Can It Help You Make Massive Gains?

  • The “top goal” is a concept from Greg McKeown, author of Essentialism: The Disciplined Pursuit of Less
    • Create priorities
    • Focus on the one thing you can do today to move closer to your goals
    • Long-term goals with short-term critical moves
    • Set aside some amount of time each day that you just work on your priority
    • If you do that, you’ll make massive gains
  • Why Matt has an accountability partner for his top goal time
    • “During my top goal time, I have somebody sit with me and they prevent me from doing anything but my top goal.”Matt Mochary
    • It’s the same idea as a personal trainer in a gym
    • More often than not they’re just forcing you to do something that you know you need to do
    • Chances are, if they weren’t there, you would probably avoid doing it
    • It depends on your personality type
    • There are apps you can try to meet someone else and you become accountability partners to each other (e.g. Habitat)

How to Approach Mass Layoffs Humanely

  • Can you be an agent for 1000 people?
    • Not you personally, but they all have a manager
    • Usually, the manager has 12 or more people directly reporting to him or her
    • Since they’re rarely letting go more than 50% of people at a time, each manager can be the agent for 6 people
    • The key to doing it well is there has to be a humane delivery
  • The biggest marker between a botched layoff and a successful layoff 
    • How did they hear that they no longer have a job?
    • If it’s one-on-one, it’ll be okay
    • If they read it in an email, or a group chat, that is no good
      • That’s when people get angry and start complaining on social media and go to the newspapers. It’s not personalized, it’s dehumanizing
    • The most important thing is to allow the person to express their emotions, and you can’t do that effectively in a group setting
  • During the implementation phase, managers reach out to people and have back-to-back meetings to deliver the news (the difficult conversation)
    • On the same day, schedule an all-hands for the stay team 
    • With the stay team, tell them what had just occurred and you answer their questions
    • The questions are almost always around fear, e.g. “Holy shit, is this going to happen to me? Are we dying as a company?”
    • Address each one of these questions and explain that the company needs to cut deep so that you only cut once
    • “You actually want to cut deep because cutting two times or three times creates PTSD in an organization. It’s trauma one, trauma two, and trauma three. Now they’re like, ah, it’s just going to keep happening.”Matt Mochary
  • Lastly, you can have a one-on-one with the stay team
    • If you don’t do this, your company will be performing better within two weeks
    • The stay team will feel sadness, anger, and fear even though you addressed their questions in the all-hands. However, some people might not have the chance to talk or express their thoughts and feelings
    • When they get an opportunity to share, it will make them feel heard
    • It doesn’t take away the emotion entirely, but according to Matt, it knocks it down by a good 25%, which is enough that the person won’t do something rash (quit, stop working, badmouth the company, etc.) 
    • And it allows them to accelerate their recovery
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