A friend of mine owns a company that he is preparing for a major growth spurt. His strategy is clear and he has built a leadership team that is well prepared to execute it. On the way to building this team, he recognized that some of his staff who had been solid performers in the past, were unlikely to be able to fulfill the needs of the strategy as the firm grew. As he planned to marshall the resources for growth he knew that he could not afford to keep these folks on in their current positions. He faced letting people go who had up to that point been loyal, solid employees, and it bothered him.

Leaders face these ethical dilemmas as their organizations grow and the individuals within them learn and grow differently. The dilemmas stem from a desire to serve the interests of the organization as a whole while being fair to the individuals who make up the organization. This is not always possible. And yet, we do not want to make that recognition an excuse to treat people as throw-aways.

As with most tough problems, the solution is systemic, rather than individual. The implied contract a business owner has with an employee is to continue offering employment so long as there is a match between the needs of the business and the talents of the employee. As a business grows, the needs will obviously change, and this is something that everyone in the organization has the responsibility to understand. The business owner has a strong interest in helping employees to understand and respond to the changing needs of the business, both so that they can meet these needs and so that they can recognize the risk that they may not be prepared to meet them going forward. So the implied contract can be expanded to include helping employees to learn and grow at the pace that the business’s needs grow. This is the essence of the learning organization.

If the business owner provides the means and the time for an employee to extend his or her capabilities, then to my way of thinking, this is meeting the ethical requirements of an expanded employment contract. If an employee still cannot meet the needs of the growing business, then it makes sense to help them find a place where their talents, interests and aspirations fit better. If the business owner does not provide time, resources and a clear picture of how the business needs and the employee’s talents are diverging, then to my way of thinking there is an ethical gap in leadership.