It’s no big surprise that companies that take an active interest in the wellbeing and contentment of their employees find it easier to attract the best talent.
Some go as far to say, ‘Your people are your most important asset’. You likely rely on every member of your team to do their job to a good level, especially if you are a small or medium business. If there is a wonky cog in the wheel, it will impact the other employees around them and this can sow the seeds of discontent, which can lead to much bigger problems.
So, you must find a way to manage your underperforming employees before this becomes a bigger issue.
What is underperformance?
You’ve likely got expected levels of performance from your employees and when they fail to meet them, that is underperformance. Underperformance can be broken into three separate points:
- failure to complete duties to a required standard,
- causing disruptions in the workplace,
- refusing to follow rules, procedures, or policies.
Some employees will display a brief period of underperformance. No matter the duration, it’s good to get to the bottom of this. They might be experiencing person problems, or they might need a steer in the right direction through support of others in the workplace. Remember, your staff are real human beings who have their own issues and emotions, and they would have to be robots to never let that impact their work performance.
Identifying the problem
There is always a reason for underperformance, and the first step to managing an underperforming colleague is to determine what the reason is for this behavior.
Here are the most common reasons:
- Personal issues: as previously mentioned, personal issues can lead to underperformance at work, and as a leader you can support your employees to assist them with their work. This might mean understanding the issues they are facing and putting yourself in their chair to find a way to overcome the spillage of personal life to work life.
- Lack of skills or insufficient training: if your industry is fast moving or you employ someone who does not have the necessary skills to complete their tasks, this underperformance is solvable with training and support. Alternatively, your employee might need coaching to learn how to manage their time better.
- Unclear expectations: if leaders are not clear on what they want employees to do, this can leave employees confused. They might be working hard but allotting their efforts to the wrong places. Make sure you have clear strategy in place, and that this is communicated clearly to your employees.
- Job dissatisfaction: If your employees are unhappy with their role because it isn’t what they thought it was, they might feel disengaged and not give their full attention to the job.
- Poor fit: every company has a culture and if employees clash with this culture, it can leave them feeling unhappy, which will detract from their performance.
- Stressful environment: If your companies work environment is stressful, this might render some staff ineffective. High staff turnover is an indication of this issue.
- Lack of engagement: if employees are doing the same thing every day, there is a chance that they are bored.
Managing underperformance
There are several steps to managing underperformance. The first is identifying the issue. You, or another member of your staff, must be perceptive in spotting underperformance quickly. Identify why it is happening if you wish to sort it out.
Document specific examples of underperformance in the form of disinterest, reduced output and quality of work, irritability, unprofessional conduct, and decreased interaction with colleagues.
Next, approach the colleague and ask for a private one-to-one discussion. In this discussion, address the situation head-on and give your employee time to explain why they are performing in this manner.
A good leader often puts themselves in the other person’s chair to understand the problem. As a leader you can be understanding and supportive but make it clear that you have noticed underperformance several times, and that this is impacting the company, as well as other team members.
Plus, it’s good to remember, that people are dynamic. They are no less static than organizations tend to be. Yet, we cannot make people into something, they don’t want to be. Generally, people can, given time, lean into their roles better, provided they are clear on what they are required to do, and for this to take place, a leader may need to approach the whole person.
Make their job clear to them
Once you have a feel for the way the employee is feeling, you may want to make it clear to them what their job entails. Tell them where you feel they require improvement and set clear goals for your employee to reach in the areas where he or she is underperforming. This should be documented on paper. This way, there is no room for misinterpretation.
Develop an action plan together where you agree on targets and ways of progressing. Also schedule regular 1-to-1’s to check in and keep things on track.
Here, building a relationship is very important. Your employee must trust that you want to help them for the right reasons.
Recognize your employees’ successes
You would be very surprised by how many issues can be solved by just recognizing your employees’ good performance. Happy employees who feel appreciated want to work hard and get better. Recognizing your employees and the hard work they do for you, perhaps through wellbeing incentives and recognition projects, can work wonders for your organization.
Should I fire underperforming employees?
As current leaders work to develop the next great employee management style, there is a lot to learn from great leaders that have preceded us.
Jack Welch’s “differentiation system,” or the “20-70-10” rule, which prescribes firing employees who fall into the lowest performing 10%. During Welch’s tenure, he was deemed extremely successful, increasing GE’s company value by around 4,000%.
Even after his success, however, this system of firing the bottom 10% of employees wasn’t applauded by all. Critics who labeled the system “rank and yank” argue that the system sets high performers against each other, which can push top talent to seek out other organizations.
Welch’s most famous leadership dictum was the active removal of the bottom ten per cent (“the C players”) of each business unit’s employees each year.
A question you might have now considered is, “Should you fire the bottom 10% of employees each year?”
There isn’t a definitive answer to the above. Some leaders still embrace this idea and enforce this management style within their organizations. Other entrepreneurs have said the approach was simply too draconian. Many leaders are committed to improving the performance of employees and, only when they were convinced it wasn’t possible, would they let someone go.
But how exactly does Jack Welch’s differentiation system or the 20-70-10 rule work?
According to Welch, a company will broadly have 20% A players, 70% B players and 10% C players.
As Welch details in his book Jack: What I’ve Learned Leading a Great Company and Great People (Warner Books, 2001, pages 159 & 160):
“A-players are people who are filled with passion, committed to making things happen, open to new ideas from anywhere, and blessed with lots of runway ahead of them. They have the ability to energize not only themselves, but everyone who comes in contact with them. They make business productive and fun at the same time.
The B players are the heart of the company and are critical to its operational success. We devote lots of energy towards improving Bs. We want them to search every day for what they’re missing to become As. The manager’s job is to help them get there.
The C player is someone who can’t get the job done. Cs are likely to enervate rather than energize. They procrastinate rather than deliver.”
A recurrent criticism of this method is that it forces managers to sometimes sacrifice otherwise good employees to protect those considered more essential. Employees who, for whatever reason, end up in the bottom rankings are fired, under the assumption that you continually allow the best to rise to the top.
Some will argue that when applied correctly and with common sense, differentiation is the kindest, most pragmatic method for building a true meritocracy and boosting team performance.
As Welch is at pains to explain (page 162):
“… [removing the bottom ten per cent of employees] works because we spent over a decade building a performance culture with candid feedback at every level. Candor and openness are the foundations of such a culture. I wouldn’t want to inject [this approach] cold turkey into an organization without a performance culture already in place.”
Whether you decide to fire an employee based on underperformance will be a decision only the leader of that organization is able to make. If after clear communication, setting goals, regular 1-to-1’s and taking the time to understand them, hasn’t worked in your favor, it is possible that it may be your only option.
Dr John Behr, an executive coach with 25 years of experience coaching leaders, says:
“In a lot of corporations there is a mindset that pragmatic talent management should lead with the organization’s bottom line in mind. But what does pragmatic mean in this sense?
“Consider whether this organization is succeeding; is it on an optimal trajectory with the bottom line in view? Breaking this question into short-term, midterm, and long-term trajectory is necessary.
“In the mid- and long-term, being as responsible with underperformers as you are with overperformers benefits the bottom line.
“Communication is what makes or breaks this performance management experience. Communicating in a direct, timely, professional, and humane manner will quickly reveal whether people will ultimately opt in or opt out of their role.
Another important aspect of managing performance of your employees is, as leaders, taking the time to get to know your team to get an accurate sense of what works for them and what doesn’t. What can be changed and what can’t. What value can be delivered by them?”
Thus, before making the decision of firing an employee, it might be better for you to take the time to communicate with your underperformers, understand them and decide whether they can still bring value to the organization and whether they want to.
LeaderBridge can help
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