I was lucky. As Palo Alto Software grew up it found some good people along the way. Some of them stuck with us, and some were related to me, a second generation. We had a sense of community that seems, now that it’s grown, vital to that growth.

But I’ve never really understood about managing employees. When I was in business school, oh, so many years ago, what they taught was organizational theory, which we called “touchy feely,” and it didn’t relate well to what happened to us as we built a company.

You work shoulder to shoulder with people and you care about them. It’s hard to give good feedback on both sides (negative as well as positive) of the performance. It’s hard to stay at arm’s length, even though that’s what all the texts and literature and common sense suggest.

So here is some of what I take out of 25 years of building a company, points related to being an employer and having employees:

1. Choosing people to fill jobs is really hard. People are unpredictable. Resumes don’t work very well, and job interviews don’t work very well either. And the legal advice all companies get from good attorneys, like all the questions you can’t or shouldn’t ask, make that even harder.
2. “Fit” as in employee fit, is vital but also overrated, and too often used as a rationalization. You want people unlike you, not people like you. But you like people like you.
3. People change. Long-term loyal and trusted employees grow in and out of the job, sometimes. Sometimes people find themselves and grow and get better and need more. Sometimes they get tired and stop caring as much.
4. Sometimes you hire the right person for the wrong job. If so, you’re lucky. You find the right job and that problem is solved. Sometimes you hire somebody just for who they are, not how they fill the job description.
5. When family business works, it’s great. When it doesn’t, I’m told, and we all know the stories, it’s hell. But it’s worked for me and Palo Alto Software. As the company grew up some family members grew up as well, finished college, worked in the industry, and came back to be a second generation of management. When that happens and you have a smart, loyal, trustworthy second generation, its great. How sad that some people assume there’s something wrong with that. Why?
6. English doesn’t have formal and informal like Spanish and German and French. One of my mentors would never use the informal you. “Because I might have to fire you tomorrow,” he would say. There’s wisdom in that, I think, but then one day he jumped out of a high hotel window to his death.
7. You can change the job, or move the person to a different job, but you can’t change the person. The people change on their own.
8. Suspicion, hearsay, jumping to conclusions is dangerous. You don’t get to act on the smoke. Wait for the fire.
9. Firing people is the hardest thing you do. And the hardest firing is the loyal and honest and hard-working employee who just doesn’t get the job done, or keeps making the wrong decision, and doesn’t fit another job. You were supposed to stay arms-length, remember? I still don’t know how people do that.
10. It’s easier to fire five people in a single day than just one person ever, except when that person’s had a bad attitude.