Let me ask if you are personal friends with your employee? Do you socialize on weekends and in off hours? If so, you are participating in what is commonly called a "dual relationship." This is hazardous territory, despite what you think is your unique ability to "handle it." If you are a new supervisor, you might want to consider now how to minimize the intimacy of the relationships you have with with those you must now supervise.
A personal relationship will always subordinate itself to the employment relationship when the "stuff" hits the fan. You'll give up that friendship before you let management snuff you for not taking action against a problematic employee. But there are many more problems associated with dual relationship. Employees know if you have a different type of relationship with one of their coworkers that looks more favorable. They'll smell it a mile away. This knowledge interferes with their belief that you are completely objective, and this will interfere with your ability to influence their productivity. What should you do about this conflict of interest? Wise supervisors who have answered this question the hard way say, "Avoid dual relationships!" Get your friendship needs met somewhere else. Getting your social needs met outside the work organization will reduce severe stress associated with the difficult decisions you must make with your employee when their performance goes south.