There’s no algorithm to apply, no flow chart to follow, no equation to run to get a perfect hit rate on the decision to develop or replace. The best executives care deeply about their people, and that’s why they often wait too long. But they also improve their judgment over time.

Which brings us to a crucial question: How do you know when you’ve crossed the demarcation line, when it’s time to make the shift from “develop” to “replace” for a key seat? I’ve come to believe the best approach is to ask considered questions and let those questions guide you to an answer. I’ve distilled years of reflection down to seven questions that I offer here to stimulate your thinking when you face the “develop or replace” conundrum. To be clear, these aren’t a prescription; you might come up with only one concern and decide to replace, or you might come up with six concerns and decide to develop.

• Are you beginning to lose other people by keeping this person in the seat?

The best people want to work with the best people, and if they sense chronic tolerance for mediocre performance in key seats, they might begin to vote with their feet. Worse, if you tolerate high-performing people who behave contrary to your stated core values, the true believers will begin to lose heart and become cynical, and some will leave. There’s no better way to destroy a great culture than to retain people in key seats who fail to perform or run roughshod over the company’s core values. roughshod over the company’s core values.

• Do you have a values problem, a will problem, or a skills problem?

If someone in a key seat behaves consistently or flagrantly contrary to the core values of the enterprise, the best leaders replace them. If someone passionately embraces the core values of the enterprise and also has the indomitable will to do whatever it takes to master his or her seat, you can be more patient before reaching a decision to replace them in that seat. The hardest call comes with the question of will. Does the person lack (or has the person lost) the will to develop to meet the demands of the seat? If not, can you ignite their will?...

• What’s the person’s relationship to the window and the mirror?

The right people in key seats display window-and-mirror maturity. When things go well, the right people point out the window, giving credit to factors other than themselves; they shine a light on other people who contributed to the success and take little credit themselves. And when things go awry, they don’t blame circumstances or other people for setbacks and failures; they point in the mirror and say, “I am responsible.” People who look in the mirror—who always ask, “What could I have done better? What did I miss?”—will grow. People who always point out the window to explain away problems or affix blame elsewhere will be stunted in their growth.

• Does the person see work as a job or a responsibility?

The right people in key seats understand that they don’t have “jobs”; they have responsibilities. They grasp the difference between their task list and their true responsibilities. A great doctor doesn’t merely have the “job” of performing procedures but embraces responsibility for the health of the patient… Every person in a key seat has a broader responsibility than a task list, and the right people never hide behind “I got the tasks done” as an excuse for failing to deliver on the broader responsibility.

• Has your confidence in the person gone up or down in the past year?

Just as a company’s stock price rises or falls as investors gain or lose confidence in the company’s growth and performance, confidence in a person also rises or falls based on his or her growth and performance. The critical variable is the trajectory of that confidence over time. When someone says, “Got it!” do you increasingly set your worries aside or do you increasingly feel the need to follow up?”

• Do you have a bus problem or a seat problem?

Sometimes you might have a right person on the bus but in the wrong seat. You might have put the person in a seat misaligned with his or her capabilities or temperament. Or perhaps—and this happens frequently in high-growth companies—the demands of a seat might have grown to outstrip the capabilities of the person in that seat.

• How would you feel if the person quit?

If secretly relieved, then you might have already concluded that he or she is a wrong person on the bus. If genuinely distraught, then you might well believe that he or she is still a right person on the bus.

The best way to share and embed cultural DNA is person to person. When you’re growing fast, the new people you just hired most likely have some responsibility to hire as well, so a week of orientation isn’t going to cut it.

If you have fifty people who understand your culture and add a hundred who don’t, you will lose that culture. It’s just math.

So when bringing in new employees—especially execs—you shouldn’t just throw them in the deep end, hand them a branded company notebook, and think you’re done. The first month or two are crucial and should be a period of positive micromanagement. Don’t worry about getting too in the weeds or not giving them enough freedom. Not at first. A brand-new person needs all the help they can get to become really well integrated. Explain how you do things in detail so they don’t make mistakes and alienate the rest of the team right off the bat. Talk to them about what’s working and what isn’t, what you would do in their position, what’s encouraged and what’s verboten, who to ask for help and who to treat with kid gloves.

That’s the best way to immerse someone in the culture, style, and processes of a team. Give them the push they need to start running with the pack rather than leaving them standing on the starting line, reading some docs, hoping they’ll catch up.

Always remember that it’s scary joining a new team. Not knowing anyone. Not knowing if you’ll fit in. Not knowing if you’ll succeed.

That’s why I started doing brown-bag lunches with the CEO. Matt did them too. Every two to four weeks, we’d gather a crew of 15–25 new hires and existing employees and have an informal lunch. We tried to cross-pollinate different people from different groups, a good mix from around the company. No managers, no executives, no keynote presentations. Just an

opportunity for them to get to know the bogeyman at the top and for me to get to know them. They asked me about our products, our policies, about me and Matt and our history at Apple. About why we didn’t allow massages, about why we had so many code names. [See also: Chapter 6.4: Fuck Massages.] And I asked about what they were excited about, what they were working on, why they joined.

It was my chance to highlight why their role was important, to talk about how their team’s goals powered our company goals, about our culture and our products and new projects and what was going right and what wasn’t. New employees had the chance to come directly to me with their questions as well as meet existing employees who were already steeped in our culture, who could help them and lead by example.

Any employee could come to five lunches a year. And each lunch was a cultural inoculation, a vaccine against indifference and apathy, against thinking that what you do doesn’t matter and that nobody at the top knows who you are.

My dad was on commission but he would often sacrifice a sale in order to build a personal connection. The best salespeople are the ones who maintain relationships even if it means not making money that day.

Those are the salespeople you want on your team. Because if you do it right, they truly will become part of the team, rather than mercenaries who swoop in, make their money, then jump ship to the next hot company, leaving a trail of problems behind them.

The danger with traditional commission-based sales models is that they create two different cultures: a company culture and a sales culture. The employees in these two cultures are compensated differently, think differently, care about different things. Hopefully most people in your company will be focused on the mission—on achieving something great together, grinding away at a big, shared goal. Many salespeople won’t give two shits about your mission. They’ll be focused on how much they’re making month to month. They’ll want to close deals and get paid. It won’t matter what they’re selling as long as it sells.

The bigger your company, the further these two cultures will drift apart. Huge commissions, sales awards, and sales conferences where everyone high-tails it to an island, ready for a weekend of drinking, may feel great for your sales team in the moment. But they can drag morale down for the rest of the company. Why are we here working, building this thing, while they’re getting wasted in Hawaii, doing shots out of their Best Salesperson of the Year trophy?

Find people who are good human beings in addition to being good at sales. Find people

who will care about your mission and be thrilled with the vital role they’ll play in making it a reality.

It might not be easy. Especially if there’s a ton of competition for talent. There are situations and industries where building a whole new sales culture and organization just isn’t feasible. In that case, you just need one. Find a sales leader who understands and values customer relationships—someone who won’t stand for egoism or cutthroat competition and who won’t hire assholes or mercenaries. That leader will shape the culture of their organization to be more relationship-oriented, until the world catches up to what you’re doing and you can implement vested commissions.

These people exist. They’re tired of transactional cultures, too. They want to do right by their customers. They want to feel like part of a real team. Hire them.

So the dating phase of any potential acquisition is crucial. You have to check the sink for dirty dishes. You have to spot the toenail on the dining table. Look at the reporting structure and the way they hire and fire employees. Dig into what perks everyone gets. Talk about management philosophy. Make concrete plans for exactly what’s going to happen postsale.

Are you going to integrate or keep your cultures separate? What will you do about overlap? Where will this team go? Who will work on this product?

But always know that you won’t be able to predict the future. Things will change—maybe in your favor, maybe not. And so, eventually, you just have to do it. Sign on the dotted line. Trust that it’ll work out.

My advice is to always be cautiously optimistic. Trust, but verify.

Assume people have the best intentions, then make sure they’re following through on them. And take the risk. Leap. Buy the company. Sell the company. Or do neither. Just follow your gut and don’t be scared (or, rather, be scared but make the decision anyway).