Managing performance issues

One of the most difficult jobs for a manager is dealing with poor employee performance. Managers will often try to defer or altogether avoid addressing underperformance of an employee; however the costs of inaction can be great. A poorly performing employee can cost the company in terms of low productivity, customer dissatisfaction and potential loss of customers, all of which can lead to reduced profits. Not dealing with a poorly performing employee will also have an impact on other staff, affecting their morale and engagement with the company. If one employee is not pulling their weight, other employees will have to pick up the slack.  

Not dealing with the underperformance of one employee sends a confusing message to employees that either the manager does not know or does not care about the performance issue. Those employees who are working hard to meet company standards of productivity and customer/client service levels could become disgruntled and lower their standards or alternatively be affected by stress-related illness as they try to compensate for their underperforming colleague, potentially leading to increased absenteeism in the workplace. By not dealing with one case, a manager could find themselves having to cope with a problem that snowballs. 

Another perspective for consideration is that of the employee. They either don’t care and will have little desire to change, in which case disciplinary action must be taken or, as is more often the case, they are struggling with a lack of understanding of company expectations and/or a lack of ability to perform at the level desired. These employees are likely to have low job satisfaction and low self esteem and in fact, may feel powerless to improve their performance. In this case, it is the responsibility of managers to correctly identify the problem and assist the employee to change and improve. 

Instead of procrastinating or ignoring the issue, taking steps quickly and appropriately will be beneficial to the company, your team and the individual employee. Questions of performance fall into two categories: task performance and contextual performance. Task performance relates to technical competencies, for example how good an accountant is at accountancy. Contextual performance relates more to attitude and engagement with the company, raising questions such as does the employee go above and beyond for clients/customers, are they team players who will work hard for the benefit of the company and will they take on additional tasks. 

When dealing with poor performance, managers must correctly identify where reasons for the performance issues lie and take appropriate steps to address them. In assessing this, managers must not confuse poor performance with misconduct. Reasons for poor performance include the following: 


  • A lack of understanding about the expectations of the employee. 
  • A lack of adequate training and/or knowledge resulting in the employee being unable to perform designated tasks. 
  • A non-work related issue is impacting on the individual’s ability to perform to acceptable standards. 
  • The employee is not suited to their position. 
  • The employee is a poor performer in all that they do. 


A productive conversation with the underperforming employee will help to clarify the underlying problem. Managers need to encourage the employee to see this as a constructive process and should therefore discuss what is working well, as well as areas where improvements need to be made for the employee to meet company standards. Addressing each area in turn: 

If an employee is uncertain about what is expected, the manager should revisit the job description and any targets and/or agreed service level agreements that the employee has been given. Managers should give the employee the opportunity to raise any concerns they have but should be firm and clear about the need for all staff to meet the expectations. A review date should be agreed with the employee (usually a month) to assess progress.  

If training and knowledge is an issue then managers must assess what has been provided and whether or not this has been fair and adequate for the employee to undertake the tasks allocated. If not, they should recommend appropriate in-house or external training for their employees. Mentoring, on the job and cross training will give a wider prospective and can be effective in helping an employee gain perspective on their value and contribution to the company however, if there are specific areas that need to be addressed, out sourced training may provide the answer to whether or not the employee is the right person for the position. 

When the issue is a non-work related problem that is affecting performance, there is a delicate balancing act to be performed. While managers need to recognise that outside influences can impact on an employee’s ability to perform, this cannot be abused by employees. Managers cannot get too involved in attempting to resolve personal problems. In fairness to the employee, a manager may wish to acknowledge the issue and the resulting impact on performance, and agree with the employee to review the work performance issue at a pre-agreed time. In doing so, both the manager and employee recognise the concern and the underlying circumstance and agree a way forward for assessment that is accepted by both parties. 

If, after investigation, a manager believes that the employee is not suited to their current position it is worth exploring whether another position may be more suitable. The employee could be a valuable asset if re-allocated within the organisation. They will already have some knowledge about the company therefore successful re-deployment may offer a beneficial solution for both the employee and company. Reviewing performance in this new role will be essential. 

Having explored all other reasons for poor performance, if a manager concludes that the employee is simply a poor performer in all that they do, termination of employment is the correct business decision. Where managers have followed fair procedures and have communicated effectively with the underperforming employee this difficult decision will come as no surprise to the employee. Handled well it can be seen as a mutually agreed parting of ways. 

Tackling poor performance at work is undoubtedly one of the more unpleasant areas of a manager’s role. However, effectively managing staff is what a manager is paid to do. Dealing with an issue quickly and effectively avoids unnecessary costs to the business. Having clear performance standards, using a collaborative performance management process and applying fair principles to your decisions will afford fair results for all involved.