Underperformance is a stressor to the employee who does not perform well, the manager, and the team. One of the remedies that most managers do with an underperforming employee is to relieve him from his position or transfer him to other departments. But, are you having the right solutions for this problem? 

According to the Society for Human Resource Management’s Human Capital Benchmarking Report, the average cost per hire is around $4,129. Also, the average time it takes to have the position is about 42 days. It means that replacing an underperforming employee may have drawbacks on the costs of hiring a new employee. Hence, you have to think twice before replacing this employee.^[1]https://www.shrm.org/hr-today/trends-and-forecasting/research-and-surveys/Documents/2016-Human-Capital-Report.pdf

Besides, are you making the appropriate ways to help the underperforming employee? Managers must fully understand why this employee is struggling with his performance. To better comprehend what is going on with an underperforming employee, you may read some insights below and enlighten on how to deal with him. 

Indicators of Underperformance 

According to a study by the National Institutes of Health, the two types of underperformance are acute or episodic and chronic underperformance. To fully gauge underperformance you should know these types of underperformance.^[2]https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7378777/

The acute/episodic underperformance has these signs such as committing a mistake, or accidentally having done mistakes, service failure or not delivering well on tasks, or medical errors, among others. This type of underperformance has limited time for a particular work. 

Meanwhile, Chronic underperformance includes not meeting the standards in regards to quality and quantity that the employee has to achieve or produce in a particular time. In addition, an employee who is an average performer can have fewer acute and episodic underperformance than a high performer. This is because the average performing employee can do tasks that are less difficult than the high performer. 

Also, consider the sources of underperformance, which are the causes of poor performances. The underperformance may manifest when the performance level is soberly measured. Some examples of this are when an employee does not meet the sales quota or has medical errors. 

Another source of underperformance is the appraisal by the supervisor or having self-appraised. These sources affect the performance level and may induce consequences. 

If the supervisor has rated the employee’s performance with a poor rating and did not make it confidential, it may result in heightened job security. In addition, the employee might have lower self-esteem and perceptions. In some instances, there will be a possible risk of termination. 

In this case, the employee’s reactions and results about his underperformance may depend on the appraisal, whether supervisor appraisals, objective, or self-appraisals. 

Costs of Underperformance

The cost of underperformance is very high. In a statistical analysis of the Project Management Institute (PMI), they found the following details: 

• The underperformance may waste a lot of money. PMI claims that for each US$1 billion spent, there is about US$109 wasted. 
• The outcome of underperformance leads to around 44 percent of strategic initiatives, which is unsuccessful. It means that the chances of success when coming up with tactical decisions is almost half because of underperformance. 
•  Low performers have 38 percent successful strategic initiatives, which is a low rate in achieving the company’s goals. 
• Underperformance has only 9 percent organizational agility. It is the level at which the company makes changes and adapts to these adjustments in the market.^[3]https://www.pmi.org/-/media/pmi/documents/public/pdf/learning/thought-leadership/pulse/pulse-of-the-profession-2014.pdf

From these statistics, the cost of underperformance is high. Hence, the organization or company would not likely consider below performance level.

How to Deal with an Underperforming Employee

1. Understand the problem

Know the problem and what causes the employee’s poor performance. Ask questions like is he unfit for the job? Or does he have personal problems that affect his performance? Or is he physically and mentally fit to work? 

In understanding the problem, managers need to observe first the underperforming employee. Once they have known the problems, talk it over with the employee. The managers or supervisors must be open about the problems they perceive. 

It is also to avoid misconceptions. The underperformer sometimes does not know that he is not executing well in his jobs. Let him know what causes the underperformance and put remedy on it. However, managers must not only point out the problem but also advise changes that the underperformer can make. 

2. Show empathy and compassion 

Keep in mind that your employees are human beings too. They also have struggles in life, whether personally or mentally. In this case, you must be understanding to your employees, especially the underperforming employee. 

The best thing you should do is talk to him. Ask him about his problems. Also, tell him what you have observed about him and how the work is affected. 

In the end, he might tell you his problem and why he could not focus on his work. Knowing his problem may open doors for help and improve his performance. You may also advise solving his problem. Be compassionate. 

When the employee sees your concerns, he will then consider your advice and will return this favor by improving his work. 

3. Find solutions

Once you know and understand the problem, find solutions or make a plan that both of you agreed to. These actions can be solutions to achieve the above performance. However, you should give him time to meet his promises. 

Joseph Weintraub, a professor of management and organizational behavior at Babson College and coauthor of the book, The Coaching Manager: Developing Top Talent in Business, said, “Everyone needs time to change and maybe learn or acquire new skills.”^[4]https://hbr.org/2014/06/how-to-help-an-underperformer

By this, you can offer assistance or training to improve his skills. Meanwhile, if the underperformance continues, you may document it if you want to relieve him from his position. 

4. Find out what motivates your employees 

The International Labour Office said that optimal performance is gained when employees are motivated and have the right skills, resources, tools, and guidance given to them at their best. Also, the open discussions and feedback about their performances are useful and credible for their work deliverance.((https://www.ilo.org/wcmsp5/groups/public/@dgreports/@exrel/documents/instructionalmaterial/wcms_745727.pdf))

Know what motivates your employees to achieve the above performance. Some companies are giving incentives such as raising their salaries or providing benefits for a job work done. Hence, most employees wish to have decent salaries and promotions.

Other employees are encouraged by the positive feedback or appraisal by their supervisors and managers. Hence, resulted in more improved performance. Managers must have open discussions with their employees sometimes to know what motivates them to perform well. 

5. Manage and communicate your expectations 

After talking to your underperforming employee and providing him with solutions, make a performance improvement plan and track his progress. You must manage your expectation by checking the progress of your underperforming employee weekly. 

You may ask him, “How are you going lately?” Or tell him that he misses or has not completed an assignment. In this manner, he will know what is lacking in himself or his work. Also, discuss your action plan with him weekly and appraise his performances during the week. 

6. Improve workplace communication

Communication is a key to better relationships, whether at home or work. Talk to your underperforming employee always. Discuss your action plan with him weekly and appraise his performances during the week. 

Be sure that there is no bias when giving feedback. If you only give negative feedback without providing positive reinforcement, then this can cause underperforming employees to feel unmotivated and unhappy about themselves. 

7. Understand your employees’ strengths and weaknesses 

Determine your employees’ strengths and weaknesses, particularly the underperforming employee. You may observe them, including their attitudes toward work and other co-employees. Or you may also use the Clifton strengths test to know the talents of your employees. Understanding your employees’ strengths and weaknesses may result in maximizing performance at the highest level.^[5]https://www.gallup.com/cliftonstrengths/en/252137/home.aspx 

8. Hire a workplace coach 

The managers may not handle the situation alone in regards to underperformance. It is advisable to hire the service of work coaches. You may have work coaching sessions in your company, in which all employees must attend and learn. 

A work coach or a peer coach is a manager who has the knowledge and personal experience in regulating underperformance. He will advise on what solutions to do to increase and improve the work performance. 

Value Employees’ Mental Health

Why is employees’ mental health important? “Mental health is a state of well-being in which the individual realizes his or her abilities, can cope with the normal stresses of life, can work productively and fruitfully, and can make a contribution to his or her community,” said the World Health Organization. Mental health is significant for employees to attain the needed performance and contribute to their team and company. ^[6]https://hero-health.org/wp-content/uploads/2020/09/HERO_MHWB_BestPractices_CaseExamples_091520.pdf

Employers may provide supports in this area for their employees. There are many employers now who are addressing the mental health of their employees and their well-being in various ways.

Benefits of Workplace Coaching 

According to the Institute of Coaching, about 70 percent benefit from improved work performance, more effective communication skills, and relationships, 80 percent of people increased their self-confidence, and 86 percent of companies said that they regained their investment in coaching and more.^[7]https://instituteofcoaching.org/coaching-overview/coaching-benefits 

Workplace coaching has the following benefits that can help your underperforming employees: 

• Enhances the employees’ performance
• Empowers the employees and make them responsible people
• Heighten the employees and staff engagement 
• Help the employees to excel in their work
• Motivates the employees
• Identifies high potential employees
• Identifies employees strengths and development opportunities

Conclusion

Helping an underperformer may save a lot, including the costs and the employee himself. If this happens in your company or organization, you may take action right away. 

Consider how you will change and help the underperformer for better outcomes. Use possible resources such as workplace coaching to improve the performance of your employees. Definitely, in the end, you will have optimal results both for you and your underperforming employee. 

Before you go, let me tell you that I am a Sydney-based certified counsellor and coach. I provide workplace coaching and executive coaching to organisations to assist them develop energising and productive workplaces. I can plan numerous team-building activities, give talks on numerous topics, and help resolve workplace conflicts. With over seven years of formal education, I am certain that I can assist you in improving your office environment so that your staff are more engaged. To learn more about my business solutions, go here.