8 Performance Improvement Tips for Managing Underperforming Employees

Eventually, every leader in an organization is faced with underperforming employees. To determine if and how performance improvements can be successfully implemented, it’s important to identify, understand, and address the root cause of these issues.

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Eventually, every leader in an organization is faced with underperforming employees. To determine if and how performance improvements can be successfully implemented, it’s important to identify, understand, and address the root cause of these issues.  

Underperforming employees are a common challenge for business leaders. And employees of all levels can find themselves struggling at some point or another  – whether that person has been with the company for three months or three years. And while it's easy to assume that an employee is underperforming because they're under-qualified, incapable, or they simply don't care, there's often much more to the story than that. And in most cases, the only way to find a positive resolution is for leaders to be attentive, listen intently, work collaboratively with the employee, and look introspectively at what they and the organization can do differently to support their struggling colleague. That's why it's critical for leaders to approach these situations with empathy, honesty, and an open-mind.

Here are Four Key Steps to Take in Dealing with Underperforming Employees 

Step 1: Learn to Identify the Signs of an Underperforming Employee – The best leaders are acutely perceptive when it comes to the performance and wellbeing of their team members. This ability isn’t paranormal – it’s simply attributable to them proactively paying attention to their employees. 

There are some key telltale signs that indicate an employee is struggling, including: 

  • Notable Differences in Behavior – There are many reasons why an employee might be underperforming (more on this to come!), but poor performance is almost always accompanied by frustration, dissatisfaction, or a lack of caring. That’s why it’s important to be on the lookout for problematic behavior such as: 
    • Frequent tardiness or absenteeism  
    • Lack of engagement with their work 
    • Decreased socialization with colleagues 
    • Frustrated or unenthusiastic demeanor and appearance  
  • Drastic Reductions in Work Quality and Output – The volume and quality of work an employee is producing is a clear indicator of their performance. If you detect that their work isn’t meeting expectations or if you notice a decline in the quality of their work, then you’ll know it’s time to touch base with that person 
  • Expressed Dissatisfaction or Frustration – When an employee is underperforming, it’s a pretty safe bet that they’re aware of it. That’s why open communication and a strong performance management system are vital. They allow you the opportunity to get a gauge on where your employees stand – including if they’re feeling unhappy, unfulfilled, bored with their work, or even overwhelmed and concerned about their performance. The key is to listen and read between the lines. And with a program like Productive Feedback & Performance Reviews, your company’s leaders can learn to utilize reviews as a tool to both provide useful feedback but also to listen attentively to what their employees are saying. 

Step 2: Familiarize Yourself with Common Reasons Why Employees Struggle – Once you’ve identified that a team member is underperforming, you need to address it so you can begin to implement performance improvement processes and help get them back on track. But first, consider potential reasons why they might be struggling so you can approach them with honesty and empathy. After all, it can be easy to immediately view underperforming employees in a negative light and chalk it up to a lack of ability or caring. And while this is often the case, it isn’t always so simple. They could be struggling because:  

  • The Job Doesn’t Align with its Description – Particularly with new hires, underperformance can arise if the job doesn’t align with the role they applied and interviewed for. Sometimes, new employees will get into a role and realize it’s not what they expected or that there are gaps between the job and their skillset. We’ll touch more on this later! 
  • They’ve Received Unclear Instructions – Data from ClearCompany shows that 50% of the workforce strongly feels that they don’t understand their work expectations. This indicates there could be misalignment between employees and leaders, which can in turn cause underperformance in comparison to expectations. 
  • They Don’t Have the Resources – Having a lack of resources can be detrimental to an employee’s ability to perform at the level you expect them to. This can be resources in the form of:  
    • Software or programs like Microsoft Office 
    • Time in the day to achieve tasks because their workload is too heavy 
    • Access to their leader for receiving clear instructions or asking questions  
    • Check in with your team at every opportunity to ensure they’re equipped with the tools they need to succeed. 
  • Their Role Has Changed – If an employee’s role changes or evolves, this can often cause them to struggle. Whether their leader asks them to tackle a project that’s outside of their job scope, to start taking on tasks and responsibilities that wouldn’t traditionally fall on them, or even to support another department, deviations in their role may not align with their skills 
  • They Lack Caring and Engagement – There’s no bigger killer of performance than an employee being disengaged or not caring about their job – and it can be frustrating for leaders to deal with. But great employers look to identify and address the cause of the issue – whether it’s frustration with leadership or colleagues, boredom, or feeling like they don’t have a clear-cut career trajectory. 
  • They’re Unable to Do the Job – Sadly, the reality is that sometimes, employees just aren’t equipped with the skills they need to do the job. Whether it’s because they oversold themselves during the interview process or simply came to find they couldn’t deliver what was expected of them, this can be a difficult scenario to recover from.  
  • There Are Issues in Their Personal Lives – Unless they open up to you, it can be challenging to know what’s going on in somebody’s personal life. But the fact is that issues in somebody’s personal life can be massively distracting and contribute to underperformance at work. 

Step 3. Take the Right Performance Improvement Approach to Help Underperforming Employees – As a leader, try to approach underperforming employees with support and empathy rather than directing them towards to the door. Address the issues but let them know that your goal is to support their growth and improvement. Research from SIO has shown that focusing feedback solely on an employee’s weaknesses can actually cause their performance to decline by 27%.  

Here are Four Key Steps to Take in Dealing with Underperforming Employees 

  • Ask the Right Questions and Actively Listen – When you notice an employee is underperforming, book a meeting with them to discuss what’s going on. Start by addressing your concerns, listing in detail the areas where you’ve noticed issues. Be honest and transparent, laying everything on the table in a respectful and supportive manner. Then, ask them questions and listen actively to the responses – they can be telling. The key is to avoid coming off as if you are attacking them or assigning blame. To do this, you can ask questions like: 
    • Do you feel that you’ve been struggling? 
    • If so, what are your thoughts on why this is happening? 
    • Do you feel that you have a clear understanding of what needs to be achieved? Is there anything I can do to help clarify? 
    • Am I being respectful of the amount of time you have to accomplish tasks? Can I do a better job of protecting and respecting your time? 
    • Do you feel that you’re being set up to fail in any way? Are my expectations realistic?  
    • Do you have the tools and resources required to do your job well? 
    • Have I given you enough context about why this job is important and how your work fits into the bigger picture? 
    • Is there anything about my management style that has rubbed you the wrong way?  
    • Where do you see opportunities for improvement in your performance? Where do you see opportunities for improvement in my leadership style?  
    • What do you love about the work you’re doing? What do you not love about it? 
    • What aspects of your work do you find energizing, and which aspects do you feel are draining? 
    • Do you feel you’re playing to your strengths in this role? 
    • How do you feel about the company’s future? Are you optimistic about it?  
    • When it comes to these types of conversations, Emotional Intelligence (EQ) is an important skill to apply as it allows leaders to exercise their empathy and pick up on subtle cues from their employee. At Outback Team Building & Training, we offer an Emotional Intelligence training and development program that can help leaders become even more effective in their roles by strengthening their EQ.  
  • Be Prepared to Hear Feedback About Yourself – You may have noticed that there are questions listed above that pertain to your management style and performance. When you open the door to feedback from your employee, be prepared for the fact that you might hear criticisms about yourself. But it’s critical that you not only embrace this feedback and take it as a learning opportunity, but also encourage the employee to be open and honest. 
  • Re-Evaluate Your Approach to Giving Direction – One of the best ways to create accountability amongst employees and inspire them to deliver their best work is to show them how their contribution impacts the big picture. So, rather than simply assigning tasks, rethink your approach to giving direction. Consider the clearest possible way of explaining the task, elaborate on how their work is contributing to the success of the organization, and share the benefits of a positive outcome. This can be done by sharing customer success stories and company growth insights during all-hands meetings or taking the time during one-on-one meetings to explain how an employee’s work fits into the overall strategy. This level of transparency will help engage and inspire your team. 
  • Set Goals and Milestones Together and Check In Frequently – For underperforming employees, it’s crucial that you work closely with them to create a path of performance improvements to get them back on track. This means creating role-related goals and milestones together and conducting frequent check-ins to assess progress and troubleshoot any issues. 
  • Make Yourself More Available to Them – When an employee is underperforming, you’ll need to make yourself more available to them than you usually would be. Encourage them not to wait until scheduled check-ins if they’re concerned about their progress and, instead, book a meeting with you on the fly if they have questions or require further direction. The key is to empower them to succeed. And, as their leader, your insights and expertise are vital. 
  • Offer Development Opportunities – While working to help an underperforming employee improve, it’s imperative that you offer them training and development opportunities. In fact, it may be wise to make it mandatory in this scenario – whether it’s reading books, partaking in training seminars, or participating in educational courses.  
  • Make It Safe to Communicate – All employees need to feel comfortable and confident talking to their managers – and this is especially true for those who are struggling. But statistics have shown that many don’t. In fact, a study from Harvard Business Review revealed that 58% of people say they trust strangers more than their own boss.  
    As a leader, it’s your responsibility to make it safe to communicate by promoting open dialogue and creating avenues for employees to speak honestly. For an in-depth look at how to do this, read our blog post: 3 Effective Strategies for Reducing Negativity in the Workplace 
  • Consider Implementing PIPs – If you’ve noticed a prolonged period or pattern of an employee not meeting responsibilities and it’s becoming detrimental to either their job or other people’s, it may be time to implement a Performance Improvement Plan (or PIP). The goal of a PIP is to implement a formalized and documented approach to getting the employee to where they need to be. While a failed PIP could result in termination, it shouldn’t be approached as a pre-dismissal situation. Rather, it should be viewed as a real and honest effort to support your employee’s improvement and success. 

    The PIP process should start with a meeting to identify issues and develop a specific and detailed action plan for performance improvements. While the process of determining these goals should be collaborative, it’s important that the employee leads the process of achieving them and takes ownership over their own development.  

    As a leader, your job is to monitor their progress and provide them with the resources they need to succeed – not micromanage and handhold. PIPs should be measured against a finite time period – generally at least a month to give ample time for improvements. You should also have frequent check-ins to assess progress, answer questions, and provide detailed examples of how they’ve improved or where they’re lapsing. 
    If you’re looking for a starting point for a PIP, check out this great template from Smartsheet. You should also contact a Human Resources professional if you have additional questions. 

Step 4: Identify Opportunities to Proactively Prevent Employee Underperformance – The good news is that there are proactive steps you can take to help mitigate the risk of underperforming employees. Based on the common factors that cause employees to struggle, you can consider: 

  • Reviewing and Refining Performance Management Protocols – Your greatest defense against underperforming employees is a strong performance management system. You should focus on giving frequent and direct productive feedback, rewarding success, and addressing opportunities with actionable solutions. Feedback should be: 
    • Unbiased 
    • Goal-oriented and actionable (believe it or not, accordingly to research from Bridge, 78% of Gen X believes performance reviews don’t provide them with meaningful growth opportunities) 
    • Specific and timely 
    • Complete with solutions and tools 
    We do a deep dive into productive feedback in our news article: 6 Impactful Tactics for Mastering the Art of Managing People. And if you’re looking for a great way to help your company improve its performance management system, you might want to check out our Performance Management Fundamentals training and development program. This workshop focuses on helping your team learn the performance management cycle, measure performance and provide impactful feedback, and coach their team more effectively. 
  • Implementing Proactive Employee Engagement – According to One4All, 38% of workers say their happiness impacts their performance at work. Engaged employees have been shown to be happier and more productive, which makes a strong case for proactive employee engagement opportunities such as team building activities. At Outback, we offer employee engagement solutions to fit any budget, team size, and business objective.  
  • Make Your Company’s Hiring Process Collaborative – In order to bring on the right people to succeed in the right roles, it’s important that your recruiting department works closely with the leader of the department that’s hiring. For example, at Outback Team Building & Training, our HR team and department leads review job descriptions together annually to ensure they’re still accurate. This way, if a role evolves, so do our job descriptions and hiring process. We also make sure this document becomes an integrated part of the employee’s role and that they review their job description with their manager during reviews.  

    To learn more about best practices for recruiting and hiring employees, check out our free resource, The HR Guide to Recruitment. 
  • Provide Learning and Development Opportunities – Smart organizations empower their employees to take ownership of their own development. Doing so helps avoid underperforming employees by encouraging a culture of ongoing learning and improvement. For instance, Outback will cover the costs of pre-approved role-specific courses and materials to help our team members sharpen their skills. It’s also extremely valuable to facilitate quarterly, semi-annual, or annual training and development seminars to help your team sharpen their professional skills.   



Learn More About Solutions to Help Develop Your Employees’ Skills 

For more information about team building, training and development, and coaching and consulting solutions that can help mitigate underperforming employees, just reach out to our Employee Engagement Consultants. 

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