It’s natural to think of layoffs as a failure on the part of the owner, but, in truth, the act of letting people go can turn out to be a great thing for your business’s future.

A Better Second Generation

During the years that I owned my business, we wondered how we would survive after each employee departure — voluntary or not. Inevitably, we discovered that every departure was a blessing in disguise. As good or irreplaceable as that person seemed to be, the new hire almost always proved to be better.

But this didn’t happen by luck alone.

Each time we replaced an employee, we took stock of his or her strengths and weaknesses, as well as the strengths and weaknesses of the related job descriptions. I came to realize that our first batch of job descriptions described the people we had already hired, as we typically wrote them only after filling the positions.

By writing new job descriptions that described what we were looking for, and by using these descriptions to attract and interview candidates, we hired much better employees.

Here’s another significant difference of our second generation of job descriptions: Not only did they describe job duties and desired performance outcomes, but they also described the individuals we were looking for. We came to realize that certain personalities were better suited for certain job descriptions.

For example, we learned that a good lead carpenter’s ability to complete one job at a time, often working alone, did not qualify him or her to be production manager. Those lead carpenter attributes were scant indication that he could manage multiple jobs simultaneously — or that he had the people skills needed to manage several other employees or subcontractors.

Similarly, back when leads were plentiful, you may have found that your salesperson could sell when he had far more leads than he could handle. He could also sell when most of the leads were repeat customers and referrals.

Now that leads are slow, is he able to sell anything? Can he — and will he — prospect to find his own leads, or does he sit at his desk, surfing the Internet, waiting for the phone to ring? Have you had to put the sales hat back on, on top of the other hats you wear?

Time to Evaluate

In addition to taking stock of job descriptions after employees leave, I suggest that you also take stock of business practices and systems.

When that last employee left, did the systems she used to do her job leave with her? Your company needs written job descriptions as well as written procedures for the duties of each position. Otherwise it will be difficult to identify strong new hires, let alone explain to them how your company does business.

It’s easy to blame challenges on the economy or on employees. But remember, you — as the owner — set the direction for your business. You are responsible for who gets hired.

After all, even in bad economies, some businesses continue to do well. Why is this? Why are they selling jobs when you aren’t even getting leads?

It’s not because they’re lucky. More likely, it’s because they planned ahead for the business they wanted, gathered the resources they needed, and carefully selected the right people for the job.

Find time to evaluate your business’s strengths and weaknesses. What used to work — and why doesn’t it work anymore? What never really worked — and why didn’t you ever fix it? What did you not do that you wish you had done? Have you ended up where you are because you planned it that way — or because it just happened?

Winners don’t rely on luck. You either plan and work for what you want, or you settle for what you get.

—Shawn McCadden founded, operated, and sold a successful design/build remodeling business. A co-founder of the Residential Design/Build Institute and former director of education for a national K&B remodeling franchise, he frequently speaks at industry events and consults with remodeling companies. shawnm@charter.net.