"If you have a 100 person company, someone is No. 100," Kevin Ryan told the audience at the Inc. 500|5000 Conference recently. "If you have a 20 person division, someone is No. 20."

Six months ago, Ryan was tasked with hiring a new manager to oversee a division of Gilt. He gave the new manager three objectives, to be completed within the first few months. They were:

-Evaluate the people you have now and lay off the people that don't fit.
-Promote people internally.
-Maintain and retain your best people.

After six months, Ryan knew the manager hadn't built an effective team. Morale was low, and a couple of key employees left the company. Rather than giving the manager more time to solve the problem, Ryan let him go immediately.

"A bad situation will fester," he says. "It is your job as CEO to make sure those situations don't happen. You're ruining the DNA of that company…by letting it go."