Managing Underperforming Employees Effectively: Strategies That Deliver Results

With “35% of employees stating that their organization’s performance management process supports their development”, it’s clear that effective performance management is more critical than ever. Yet, despite these efforts, underperformance remains a challenge in many workplaces. Managing underperforming employees effectively is, therefore, a business imperative. To address this, it’s essential to understand what drives underperformance, why promptly managing underperforming employees matters, and the strategies leaders can use to manage underperforming employees effectively. Let’s dive in!

Employees are the backbone of every organization, and their performance directly influences the organization’s ability to achieve its goals and drive business success. However, employee performance can vary, with some talent underperforming and falling short of achieving their work goals. Underperformance can take many forms, including failure to meet job expectations, displaying negative or disengaged behavior, or violating workplace policies and regulations. In addition, it includes missing important deadlines, frequently being late to work, displaying low motivation or interest in work, or consistently delivering poor-quality results. To maintain a productive and positive work environment, recognizing and addressing these signs of underperformance is crucial.

Underperformance is a significant factor that can undermine an organization’s overall productivity. Nevertheless, every organization faces underperformance from a few employees that, according to research, “depending on the organization, underperforming employees typically make up between 0 and 20% of an organization, with the median being 4%” (Source: Culture Amp). Let’s explore some of the common reasons behind employee underperformance.

One of the probable reasons employees underperform is a lack of the necessary skills to succeed in their roles. This deficiency can stem from a mismatch between an employee’s capabilities and the requirements of the position or from being placed in roles that do not align with their strengths. Furthermore, in some instances, employees may have the potential to succeed but require upskilling to reach that level, but organizations fail to provide adequate training and development opportunities to enhance their skills and knowledge.

To accelerate project completion, the leadership sometimes sets unrealistic deadlines that often result in excessive workloads that exceed the capacity of individual employees. This pressure can negatively affect the quality and timeliness of the work, leading to disengagement and a decline in overall performance across multiple tasks and projects.

When employees face limited opportunities for career growth, receive inadequate compensation, or lack support from colleagues and leadership, they are more likely to feel dissatisfied at work. Additionally, employees getting to opt for monotonous work routines with little challenge or no sense of purpose may begin to feel disengaged. This lack of motivation can significantly impact their performance, leading them to become underperformers.

To enhance employee productivity and performance, it’s essential to foster healthy relationships in the workplace, both among colleagues and with leadership. However, when the work environment is disrupted by unacceptable behaviors such as bullying, aggression, social exclusion, or hostility, it creates a toxic work culture with conflicts. This diminishes the operational effectiveness due to emotional exhaustion, disengagement, and ultimately, underperformance.

Poor work-life balance, often caused by micromanagement, unrealistic deadlines, or constant pressure from leadership, can leave employees feeling overwhelmed and disengaged. This disengagement can manifest as a form of silent resistance, where employees withdraw emotionally or mentally from their work, leading to underperformance.

Organizations often embrace change with business shifts, technological advancements, or the implementation of new policies. While change is an inevitable factor for growth, some employees may struggle or show resistance when adapting to these transitions. This unwillingness or inability to adapt can lead to stagnation, reduced engagement, and ultimately, underperformance.

Now, this highlights an important question: why is managing underperforming employees important? An employee’s performance is not limited to completing a task or checking off a project, but it affects the entire organization and its workflow. When one person consistently underperforms, it can impact the business outcomes. Here are some of the reasons why it’s important managing underperforming employees head-on.

• Underperformance can lower overall team productivity, damage the employer’s reputation, and reduce operational efficiency, hindering the organization from attaining its goals.
• When underperforming employees miss deadlines, teammates are forced to compensate, leading to resentment and burnout.
• Underperformance can lead to delays, errors, or poor service, impacting the customer experience and lowering satisfaction levels.
• Ongoing underperformance can raise concerns about organizational culture and impact attracting performance-driven new talent to the organization.
• Concerning the individual, the improper management of underperforming employees leads to poor self-esteem and loss of confidence.
• With errors and poor services associated with underperformance causing significant delays or substandard work, the profitability of the organization gets reduced.

Considering the significant impact of unmanaged underperformance, it becomes essential for organizations to adopt effective strategies to address it. Explore the key approaches to managing underperforming employees in a constructive manner.

The most important aspect of managing underperforming employees is to address underperformance effectively. This involves identifying the root cause, analyzing the problem, conducting personal meetings to offer solutions, implementing a Performance Improvement Plan (PIP), and continuously monitoring and reviewing the employees, ensuring support without creating additional pressure for the employee.

Offering continuous and consistent training not only helps in managing underperforming employees but also serves as a best practice to prevent employees from becoming underperformers. Employee training focuses on skill enhancement through reskilling and upskilling, additional onboarding, role-specific training, technology-related instruction, and knowledge sharing to help employees work more effectively and harmoniously with their teams.

Managing employee expectations by being realistic and considerate about what each employee can reasonably deliver. This includes eliminating unrealistic deadlines and unnecessary pressure, while promoting a healthy work-life balance through initiatives such as paid time off. Furthermore, support employees in improved focus and productivity, helping teams meet desirable and achievable deadlines.

Monitoring employees while recognizing their progress by acknowledging even small improvements is crucial to managing underperformance. It displays that their efforts are valued within the organization. Additionally, developing an action plan that suits the individual employee’s needs can further support their performance improvement.

Offering employee well-being initiatives can help reduce underperformance related to stress, burnout, or mental health challenges.

“Job crafting is a proactive approach to shaping the job description to better align with the employee’s skills, values, and goals.” Managing underperformance caused by a lack of motivation can be addressed through job crafting. This involves allowing employees to make small adjustments to their roles and focus on responsibilities that align with their strengths, ultimately boosting their motivation and engagement.

The next steps, such as termination, should be considered only as a last resort, when all other strategies have been exhausted and the employee still shows no signs of progress. This approach helps uphold the organization’s standards and its reputation as a responsible and professional employer.

In short, considering that employee underperformance can significantly impact the overall operations of an organization, it is essential to implement best strategies for effectively managing underperforming employees.