Why is it that, when a company grows, someone is always left behind?

A few months ago I had to let a longtime loyal employee go. She had been with my company almost from the beginning. She had started out as a receptionist, straight out of college, and worked her way up to account executive and vice-president. But something had happened along the way: the company outgrew her. We reached a point at which we needed people with a sophistication about our business that she just didn't have. She didn't have it, ironically, because she had never worked for any agency except ours. That might seem unfair, but it had become a real problem, and I could see it would only get worse.

So we had lunch one day, and I laid it out to her. I said: "Look, I could keep you on and keep you happy, and in five years you'd be disappointed that you didn't get the opportunities you wanted. You would say, 'Why didn't you tell me then, when you had that first inkling of the problem?' " I looked her in the eye and said, "This is then."

I tried to be sensitive and compassionate. It didn't help. She became emotional, and I felt so coldhearted. I'd worked myself up to being very rational about the decision. I knew I had to do what was right for the company. I also believed it was right for her, and I know she would agree with me today. At the time, however, none of that made the situation easier for either of us.

After 11 years of running my own company, I still find those conversations difficult, although not quite as difficult as they once were. Little by little, I've come to accept and, for the most part, enjoy the responsibilities of my job. But I have to admit there is a part of me that has never become fully reconciled to the losses involved in growing a business. I'm talking about the personal losses -- the relationships built and broken along the way.

In the early days of my company I took every departure personally, no matter what the circumstances. I remember the first time an employee told me she was leaving. She had been the first person I had hired. I had known her from a previous job, and we were friends. She said she wanted to start her own business. I was devastated. I felt completely and overwhelmingly alone.

Even more than the loneliness, I had a sense of personal failure. I felt as though I'd done something wrong -- that I wasn't doing the best job possible. During that period we lost several people because we couldn't pay them enough money. Each time I thought, If I were smarter, I could figure this out. If I had a better handle on the situation, if I knew more about motivating people, I could help them sell more and keep them with us. It was a sense that returned whenever someone left. I couldn't shake the feeling that I could have made a difference if only I knew the answers.

And believe me, I was acutely aware of what I didn't know back then. When a start-up takes off, it's like being in a vortex, with things whirling past you at an amazing rate. You try to grab information as it goes by, to absorb as much as you can. There's no time to think. The business is constantly changing. It's all you can do to keep up.

Of course, the business is changing because it's growing. That's both satisfying and scary. I was astonished to see how fast a company can outstrip the people who work for it. As the owner, you see employees who aren't cutting the mustard, and you think, What if I'm not cutting it? Who's going to tell me? I guess it's the banker, the accountant, the numbers on the income statement. But still you wonder, How long can I stay on top of this business?

To complicate matters, your role is changing. In the beginning, a business is kind of an adventure, and everyone is having fun. You think, If it works, it works, and if it doesn't, to hell with it. You want the good feelings, the friendship and camaraderie, the moral support. But at a certain point, I realized the friendship was becoming secondary. What I needed was performance. I was making more and more commitments -- to suppliers and to clients. It was my job to make sure other people were doing their jobs. I had to be the boss.

The challenge was to be a good boss. I felt an obligation, for example, to bring people along with education, but small companies have no resources for training. It just doesn't happen. As a result, you outgrow employees at a rapid clip. We'd get people in, barely get them acclimated to the company, and find we were stepping over them. I soon learned I couldn't hire for today. I had to anticipate what a job was going to be a year down the pike -- which was difficult because by then we'd be an entirely different company.

I tried to figure out why some people were able to keep up the pace, to stay and grow and work shoulder to shoulder, while others fell out of step. Someone we'd hired as a typist had begun to do the bookkeeping, probably because she kept a neat checkbook. Three years later she was heading up our accounting department, and it was time to computerize, which was completely beyond her. So I had to tell her, "There are excellent skills you have, but there are other skills you don't have, and those are the ones we need now." Those are hard conversations to have, because of the memories involved. You remember the sign you put up in the elevator: "Typing help needed." You remember how she looked when she answered the ad. You remember the good times. Yes, you feel proud that the company is growing, but there is also a bad feeling, as if someone were being ripped out of the family. The other family members look around and have the same self-doubts as you do.

The good news is that the process does get easier as time goes along. The most important step comes when you accept, in your heart of hearts, that you must absolutely do what is right for the business. Once you've taken that step, you can begin to communicate it to employees through your actions more than your words. By now all the people in my company know that -- as much as I may care for them, as secure as I want them to feel, as trusting an environment as I want to create -- the business always comes first. Faced with a choice between an individual and the business, I will always choose the business because it supports everyone else.

With time and experience, moreover, comes perspective. You begin to realize that a company goes through a natural evolution. When you're just starting out, you need one type of person. Once the company develops a framework and a skeleton, you need another type of person. And so it goes. At each stage, you gain some people and you lose some people. You gain those who can push the business forward and lose those who've become impediments. You gain those who see their future in your company and lose those who don't. Then there are the people who wake up one morning and realize that the company has changed, and they're simply not happy there anymore. So they leave. But there are others who have never been happier, and they stay.

Perspective alone does not solve the problem, however. It has been only in the past year or two that I have stopped having that nagging sense of failure whenever someone has left the company or I have asked a person to leave. I finally got over that hurdle with the assistance of my partner, who joined us from a large agency in 1986. He helped me understand that losing people wasn't necessarily a sign of personal flaws. There are, after all, many places to work in the world. Tassani Communications may not be the right one, given the individual's skills and our needs. That doesn't mean there's anything wrong with the person or with the company or with me. It just means there isn't a fit.

Of course, understanding all that doesn't ensure that the partings will be easier or less emotional. Recently, an employee who'd been with us for several years told me she was leaving. She said the company wasn't the same as when she came on board. She thought it was still a great place. But it wasn't as small and as intimate as it had been, and that was what she wanted.

I had actually seen this coming and brought in someone who could replace her if she left. But when she told me her plans, she started to cry, and I have to admit, my eyes filled with tears, too. Not that I thought I had failed. I was just overcome with the sense of change. It was the recognition that the business is growing, the business is changing, we're getting big, and I'm out there on a limb, responsible for it all, and the little security posts are falling away.

When she left my office, I closed the door. Another colleague came by and knocked, and I told her to come in. She looked at me and said, "Your eyes are red." I told her about the employee's decision to leave. She said: "But you were prepared for that. You already have a plan in place. We're fine from a business standpoint." I said: "I know, I know, it's just the change. I just need a few minutes to get this out of my system and deal with the change."

Ten minutes later I walked into a meeting. Everything was OK. You move on. But I have to wonder whether I will ever get over that sense of loss when people leave the company. Then again, maybe I should start to worry if I do.

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Sally Tassani is the founder, president, and CEO of Tassani Communications Inc., a marketing communications agency in Chicago. In 1990 she was named Woman Entrepreneur of the Year for the Illinois region in the program sponsored by Inc. , Ernst & Young, and Merrill Lynch.