When engaged and motivated employees continuously deliver quality work within the scope, the success of business is mostly guaranteed. But, let’s be real- things do not always go as planned.
Poor job performance happens and it can significantly impact the overall business efficiency, revenue, and reputation.
That’s where HR teams come in to demonstrate how to improve staff performance. But, what can HR teams and organizations do to not only detect and fix performance issues but also to ensure consistent improvement and growth?
What is Poor Work Performance?
Poor work performance is the incompetence of an employee to meet the required standard for the position hired. It can involve less-than-expected output, failure to meet the set targets and goals, or frequent absenteeism.
Employee work performance may also be linked to their interactions with other team members. Ineffective communication and negative behavior are key indicators of poor work performance.
Common Causes of Poor Job Performance
Before addressing and managing poor job performance, it is important to identify its root causes. Poor performance usually comes from two general causes: inability and lack of motivation.
The inability may result from a lack of resources, skills, unrealistic expectations, or external obstacles beyond employee control.
Lack of motivation may result from a deficit of rewards and recognition or, on the other hand, from a lack of penalties for poor performance. A common reason for lack of motivation is burnout, which happens when employees experience excessive stress and workload, a toxic work environment, or no paths for development.
Other causes of poor job performance may include a lack of feedback from the employer, poor management, or personal and health issues. In many cases, poor job performance may be a result of mismatched skills, when the management assigns employees tasks not aligning with their skills.
Signs of an Underperforming Employee
Employers and HR teams can easily diagnose it when seeing the first signs of underperforming employees.
Here are some behaviors to watch out for, indicating that an employee is underperforming and needs more attention and assistance:
- Spending more time on the project discussion than execution.
- Delegating most of the tasks.
- Shifting responsibility and refusing to admit faults.
- Being frequently involved in conflicts.
- Being often late from work or meetings.
- Being frequently absent from the workplace.
- Leaving the workspace early without notifying the manager.
Meanwhile, observing one or more of the signs above once shouldn’t result in punishment. Rather, it should be an opportunity for a dialogue to resolve the issues, reduce performance concerns, and improve employee work performance.
How Poor Employee Performance Impacts Businesses
Underperforming employees reduce overall business productivity influencing financial outcomes and team morale.
A 2023 Gallup Report has revealed that underperforming employees cost businesses $8.8 trillion globally.
Financial and Operational Consequences
Unsatisfactory work performance can bring major financial and operational consequences. These consequences manifest in various ways, including:
- Lowered Productivity: Underperforming employees complete tasks more slowly and make many errors resulting in lower deliverables and lost resources. The lowered productivity impacts the business’s ability to meet client requests and overall business performance.
- Negative Impact on Revenue: Customer dissatisfaction caused by underperforming employees can make customers look to competitors, resulting in reduced sales and long-term revenue loss.
- Increased Costs: Businesses spend additional resources on training and supervision of underperforming employees. On the other hand, exiting non-performers from the business and replacing them with new hires can be even more costly. What’s more, replacing underperforming employees with new hires requires considerable time and financial resources for recruitment, onboarding, and full productivity. Studies show that it can take over 94 days for highly skilled positions to find a suitable replacement, followed by extra time on onboarding.
- Legal Consequences: Poor work performance in regulated industries often results in fines, penalties, and reputational damage for businesses.
Effects on Team Productivity and Morale
Poor work performance can take a serious toll on the overall team productivity and morale. 
Some productivity and morale-related issues include:
- Extra Workload for Teammates: The underperformance of one employee can make others do the lifting. This may result in stress, burnout, and a lack of productivity for the team.
- A Drop in Work Quality: Compensating for an underperforming employee can lead to errors, missed deadlines, inconsistencies, and a major drop in the overall work quality.
- Reduced Innovation: Poor job performance may make it complicated to generate new ideas and develop innovative solutions forcing businesses to lose the competition in the market.
- Lowered Motivation: When other teammates witness that poor performance leaves unaddressed, they may become less driven to put extra effort into their jobs.
- Toxic Work Environment: Higher stress levels and lack of accountability can lead to conflicts in the company leading to a toxic work environment making high-performing employees leave and increasing employee turnover rates.
The Role of HRM in Managing Underperformance
Human Resources Management (HRM) plays a significant role in detecting, managing, and tackling unsatisfactory work performance.
Underperformance is an inevitable issue for any company, and managing it effectively is one of the key HRM responsibilities. HR managers should know how to deal with underperforming by finding insights, detecting gaps, and dealing with underperforming staff.
One of the most efficient ways HR managers can get appropriate data and insights is through time and attendance software. This software helps to track attendance patterns like late arrivals, early exits, and prolonged breaks.
The mentioned attendance habits are primary markers of potential job performance issues. AMGtime time and attendance software provide real-time reports, allowing HR managers to address attendance issues before they become major performance problems and determine how to improve staff performance.
How to Manage and Improve Underperforming Employees
Underperformance happens in every company and all employee levels. Each aspect requires specific approaches. However, some key points set the basis for reducing performance concerns in the long term.
Setting Clear Performance Expectations and Providing Feedback
Unclear performance expectations and lack of feedback are common causes of poor employee performance.
Every employee needs to understand the expected standards. To define clear expectations, employees and HR teams should:
- Set measurable goals and key performance indicators (KPIs) for each employee.
- Establish realistic deadlines for completing tasks.
- Make sure the expectations are aligned with employee skills.
Once the goals are set, continuous feedback mechanisms are critical to assess whether the employee meets the requirements.
According to Gallup, 80% of employees who report receiving valuable feedback demonstrate a high level of engagement.
Employee feedback should be timely and balanced, including employee strengths and weaknesses.
Effective Strategies to Reduce Performance Concerns
Managing poor performance is a valuable skill for employees and HR teams. It requires empathy, active listening skills, clear communication, firmness, etc.
Addressing employee performance effectively can help businesses keep and improve productivity and increase profits.
Here are some effective strategies to reduce performance concerns and increase overall employee and business performance:
Implementing Em
ployee Training and Development
One of the most common causes of poor employee performance is a lack of skills and knowledge. The issue becomes more critical with the rise of technology.
A PricewaterhouseCoopers (PWC) survey with over 4000 companies has shown that the most critical challenge employers face is the identification of the skills employees will need due to technological advancements.
Continuous employee training, including workshops, and courses may help increase employee performance and engagement.
Addressing Workplace Challenges Affecting Performance
Employee work performance can be affected by workplace challenges, including lack of resources allocated, communication issues between team members, a high-stress environment, and more.
Addressing these challenges promptly is key to managing underperforming employees and establishing a positive and productive work environment.
Using Performance Improvement Plans (PIPs)
Using a performance improvement plan (PIP) is the basis for managing underperforming employees. It should include an action plan for non-performing employees outlining the specific outcomes, the available support from the employer, and reasonable deadlines to reach the goals.
Improving with Modern Software
No candidate is perfect, not the ones who you have hired after a long hiring cycle nor those having academic and professional qualifications and titles.
On the other hand, each employee has the potential to perform at their best. However, poor work attendance, lack of skills, unrealistic expectations, lack of feedback, or other similar factors can impact performance.
Thankfully, contemporary HR technology allows employers to manage unsatisfactory performance effectively and help employees reach their full potential.
