Stellar employee performance is pivotal in achieving your company’s goals and enabling it to thrive in the competitive business landscape. However, not all individuals will consistently fulfill their responsibilities and meet your expectations.

It may be difficult to learn you hired an underperformer, but it’s not the end of the world. Although it doesn’t mean you should cut contracts short immediately, you do need to address this pressing matter right away to maintain high productivity in your business.

This article delves into that topic to guide your next steps. It’ll help you understand what causes low performance, its effects on your business, and then provide you with tactics you can put into practice right away to improve your personnel’s work ethic.

How do you define employee underperformance?

Employee underperformance can be described as instances when an individual consistently fails to meet your company’s expectations, standards, or objectives, particularly for their role.

How companies measure their employees’ productivity varies, but a significant drop can appear in common manifestations like:

  • Missed deadlines or targets
  • Subpar quality of work
  • A lack of initiative
  • Poor teamwork

These can negatively impact the performance of other personnel as well and thus hinder the organization from achieving its goals. As such, it’s essential for you to identify and address the specific causes within your company promptly.

Why do employees underperform?

Many variables contribute to an employee’s dip in productivity, so identifying them can be difficult. To clear some of that fog, here are a few of the most notable factors.

Lack of skills or training

Underperformance can easily stem from a lack of skills or training necessary to perform a job well. Luckily, the solution to this kind of issue can be as simple as providing employee learning and development opportunities.

However, if a person regularly struggles with an assignment, they’ll fail to provide adequate results no matter how much time and effort they put in. These instances can be attributed to the next reason why employees underperform.

Poor management or supervision

There are many ways to mismanage employees and hinder their productivity. Some typical examples include:

  • Assigning the wrong tasks: A superior who designates responsibilities that don’t fit an individual’s skill set will inevitably cause problems that can affect an entire team. It indicates an ineffective assessment of the employee’s competencies, the improper delegation of duties, and poor leadership.
  • Miscommunication: Setting inappropriate goals or providing unclear expectations or instructions can easily lead to poor performance. Employees must firmly grasp what’s required of them to achieve good results.
  • Lack of support: Underperforming employees will need guidance and feedback from their managers. Inadequacies in this respect can cause workers to make mistakes regularly or continue incorrect behaviors that impact their overall performance.

Evolving roles

Industries and technologies shift, so business processes and jobs have to adapt as well. Such transitions can render an employee’s competencies obsolete and affect how they fit the role they were originally hired for.

Throughout this period, they’ll learn new skills, tools, and workflows, so their performance may drop while they adjust. However, these are typically temporary and can be resolved through training initiatives.

Personal issues

Obviously, an employee can’t focus on their job if they’re distracted by external troubles. More often than not, stresses revolving around one’s home, family, or health bleed into the workplace and considerably impact one’s performance. In this case, the best you can do is give your worker time to overcome their problems and return to proper form.

These situations are also opportunities to earn their trust and loyalty, so approach them with empathy and genuine concern. You can ease their burdens as well and offer compromises like allowing them to work from home a few days per week, referring a babysitting company, etc.

Cultural mismatches and workplace conflicts

Sometimes, people simply don’t fit into their work culture, and the solution to this problem requires greater effort on their part.

Moving them to another team may resolve this, but if the group uses a methodology that the individual in question is unfamiliar with — like switching from a Waterfall project management approach to an Agile one — they may require a shift in mindset instead.

If you fail to address this quickly, workplace conflicts may arise and result in interpersonal disputes that prevent everyone from succeeding.

Absence of recognition and meaningful rewards

Employees lose motivation when their efforts to go the extra mile don’t earn them any additional benefits. If this is a major reason for their dip in productivity, consider establishing a system that properly acknowledges and incentivizes those who exceed expectations.

Signs of employee underperformance

It’s essential you be able to recognize the causes of underperformance for faster remediation. To help you swiftly identify unproductive employees, here are some of them:

Low employee engagement and morale

The various causes of underperformance we’ve discussed can hurt employee engagement, morale, motivation, and job satisfaction.

Whatever the case, an issue can easily stem from an individual, then spread to the rest. This cultivates negative attitudes and lowers overall engagement among teams, so it’s best to investigate any red flags immediately, as the cause may run deep.

Decreased productivity

A concrete way to gauge a worker’s productivity is their output. A noticeable drop in measurable outcomes (e.g., missing sales quotas and deadlines) or work quality (e.g., reports or documents that regularly require revisions) is a strong indicator of an underperforming employee.

Some forms of below-average performance hinder others’ workflows as well, particularly people who work with the underperforming individual. Failure to meet the organization’s set objectives and key performance indicators (KPIs) also helps reveal this condition.

Attendance issues

An employee with a notable increase in absences or tardiness is a strong marker of underperformance and a loss of engagement. It not only dampens the amount of work they accomplish, but their teammates then have to pick up the slack.

Complaints from colleagues or customers

Complaints from colleagues are unavoidable, especially if the underperforming employee is detrimental to productivity, team harmony, and workplace attitudes. The moment grievances are reported, it’s vital you look into the situation at once.

Depending on the role, customers can uncover dissatisfying behavior as well, especially concerning individuals who deliver substandard services. These instances can tarnish your company’s reputation, so they’ll require speedy resolutions.

The cost of underperforming employees

Knowing the contributors and identifiers helps resolve employee underperformance early, but what happens if you address the issue too late? Slow reaction or outright neglect can yield costly consequences for your business.

Dissatisfied customers and a damaged reputation

As previously stated, underperformers can produce poor-quality products and services that lead to disappointed customers.

However, 96% of these consumers won’t complain to your company about it; they’ll likely share their bad experiences with 9 to 15 people instead, which will greatly harm your brand’s perception.

Missed opportunities and lost revenue

Having subpar performers is unprofitable. The negative impact they have on your organization’s reputation can result in a massive loss of potential and existing customers and adverse financial repercussions.

On the other hand, companies with highly productive teams enjoy 20% more sales and are 30% more profitable than those with underperforming employees.

Difficult recruitment

Besides influencing how your customers see you, unchecked underperformers can also hurt your employer branding.

Compared to the business itself, job seekers are three times more likely to trust its employees to provide credible information on what it’s like to work for the company and ask for their feedback.

Those who suffer from a lack of training, mediocre management or leadership, cultural misalignments, etc., will have less-than-stellar things to say about it. So, it’s extremely important you resolve any issues immediately, as dragging it out will impede your ability to recruit top talent.

Training expenses

Learning and development opportunities can help underperformers return to proper form so they do their jobs well. However, such initiatives require an investment of time, money, and effort from your organization.

Increased workplace stress

Unproductive individuals may leave work unfinished and backlogs unchecked, resulting in operational deficiencies. This then disrupts their teammates’ workflows, mainly because they have to pick up the slack and deal with the resulting stress. That additional workload can be detrimental to the group’s overall productivity and well-being.

Higher turnover

Many contributors to low employee performance affect turnover as well. For instance, 76% of U.S. workers say their manager establishes the culture, which underscores the powerful influence of supervisors. In the same vein, 36% of employees complained that their manager lacks the know-how to lead a team.

Poor management often results in negative workplace culture, which is the perfect combination to produce disengaged and unhappy workers.

How to manage underperforming employees

We’ve covered how underperforming employees impact your business and how to identify them. Next, we’ve listed some steps you can take to address their underlying problems.

Assess the situation

Employees struggle for many reasons, and their performance issues may even stem from factors outside their control. Invite them for a meaningful discussion where you listen to their insights and express your concerns.

Periodically conduct performance reviews, analyze the problems they’re facing, and understand the team’s dynamics to grasp what’s going on. For example, you may find it’s a simple issue of miscommunication or a lack of direction.

Taking them through comprehensive assessments can also help identify any skill gaps or job mismatches.

Provide clear feedback and expectations

If you use a 360° feedback system or another methodology, it’s easy to offer actionable, constructive criticisms. If not, you’ll have to undertake this process manually. To provide actionable input for your underperforming employees:

  1. Record instances of their substandard performance.
  2. Ask what they think is needed to resolve the issue.
  3. Share your point of view.
  4. Talk about their possible next moves.

If that procedure fails to yield results, you can take a more comprehensive approach in the form of a performance improvement plan.

Develop a PIP

A performance improvement plan (PIP) lets you highlight productivity issues, outline steps that will lead to a solution, and define consequences for failing to meet the agreed-upon improvement goals. It essentially draws a roadmap that guides underperformers to bounce back and succeed.

Set specific, measurable, attainable, relevant, and time-bound (SMART) goals for the employee. Usually, to avoid surprising them, a PIP also establishes several instances to provide actionable feedback or warnings.

Once the employee understands what’s expected of them and agrees to the PIP’s provisions and parameters, you must set deadlines and milestones for them to meet. These let you track the individual’s progress and reward their achievements. In this regard, regular follow-ups are a great help.

Align responsibilities with employee strengths

If your employee is floundering because they receive work that conflicts with their skills and interests, have a discussion, listen to their preferences, and find out if there are other tasks they feel better suited to accomplish.

After, reassess your approach, then shift resources and responsibilities to maximize the worker’s talents. If they continue to struggle with their role or team, a move to a different one might be the right call.

Offer training, mentoring, or educational resources

Your assessments may reveal an underperformer lacks the specific capabilities needed to succeed in their role. To address this problem, you can offer upskilling and reskilling opportunities. For instance, if a leader’s communication style doesn’t resonate with teams and demotivates them instead, emotional intelligence training would help them.

So, when the opportunity arises, give underperforming employees the chance to improve and resolve their problems. If they’re unsure of what they need, be ready to point them in the right direction.


Low performance due to personal troubles is a complicated problem. The variables impeding worker productivity are likely out of your control, so most solutions will have to result from them.

However, you can ease that burden by meeting them halfway. For example, imagine a married individual with a toddler: They may need more time to care for their child, so you could allow them to work from home and be flexible with their schedule.

When dealing with workers whose private worries overshadow their work responsibilities, it’s best to give them time and relieve some of their stress.

How to coach underperforming employees

You now know how to manage underperformers, but how is it different from taking on a mentorship role? Here are a few tips that can help you out.

Set realistic goals

We mentioned how SMART goals are excellent for underperformers, because making them aim for an unreachable standard will further demotivate them.

When guiding a struggling individual, the most important aspect of plotting desired outcomes is making them attainable. It gives them the opportunity to recognize their own milestones, consistently achieve objectives, and gain confidence.

Once they find their rhythm, your step-by-step approach to improving their performance will have paid off.

Regularly follow up and hold underperformers accountable

Nobody improves without the desire to do so. As a mentor, it’s your job to drive and maintain that motivation. By consistently following up on the employee’s progress, you promote accountability and ensure they make sustained efforts to reach their goals.

Make yourself available

Struggling employees may find it difficult to discuss the challenges they face or ask for further guidance. As their coach, establish open lines of communication and show underperformers you’re easy to reach.

Once they recognize they can readily approach their mentors, they’re more likely to voice their concerns, provide progress reports, and point out possible improvements. This makes the overall process easier for both of you.

Reassess and adjust

At times, you should reevaluate your approach to helping the underperformer improve. Are they showing signs of progress, or do their problems persist?

Typically, those with potential thrive when given the right training, opportunities, and environment. When issues remain stagnant, however, it’s time to review your strategies and see what changes you can make.

How to motivate underperforming employees

As we discussed earlier, employee motivation plays a key role in remedying underperformance. However, keeping people driven as they go through the improvement process can be a challenge. The following best practices can help you handle this undertaking.

Understand individual drivers and goals

To inspire change in underperforming employees, you must first understand what makes them tick. Have meaningful conversations with them to find answers to questions such as:

  • Is this individual driven by a desire for recognition?
  • Are they stimulated by opportunities to work on high-profile projects?
  • Do rewards like monetary bonuses or paid vacations push them to do more?
  • Does this person seek chances for advancement, but none are currently available?
  • Do they possess a more intrinsic drive like making a social impact?

Understanding what prompts your workers to act is extremely vital to boost their overall productivity.

Offer learning and development opportunities

Limited chances of furthering one’s career can be extremely demotivating and impede an employee’s overall performance. It can even push an individual to seek out greener pastures.

Providing opportunities to gain new skills and knowledge can counteract that potential turnover. In fact, 94% of employees have asserted they’d stick with a company for longer if it showed a commitment to helping them learn.

Nurture a sense of purpose

Employees desire a sense of internal value at their workplace. Being part of a higher purpose is a desirable characteristic of one’s job, but an environment that fosters deeper human connections, personal growth, and cares for their overall well-being takes it to another level.

To deliver this intrinsic worth and keep your underperforming employees engaged, you must highlight their impact on the team and the entire organization. Remember, your workers are human, so taking this step can ignite their desire to do better.

Give them autonomy and flexibility

Let underperformers take ownership of their work and improvement journey to empower them to bounce back. Being assigned to key projects, for instance, and giving them the freedom to experiment, be creative, and do their best work helps nurture a sense of trust.

That not only offers them opportunities to rise to the occasion but also allows them to make mistakes and learn from the experience for future excellence.

Recognize and reward improvement milestones

A lot of people in the workforce want tangible proof that their efforts are paying off, with 37% of them saying personal recognition would entice them to go the extra mile at their job.

So, to keep your underperformers driven throughout their improvement journey, incorporate a system that recognizes and incentivizes them whenever objectives are achieved.

What if underperforming employees don’t improve?

If you’ve done everything possible, but your underperformer fails to make progress or deliver results, it may be time to let them go. This unpleasant and difficult situation thus requires a careful approach. To minimize the risk of hurting you and your company’s reputation, fire your employee with empathy.

Remember to document everything as well. If the underperformer decides to appeal your decision, you’ll be able to support your actions with concrete evidence. Before you come to this conclusion, however, take the following factors into account.

Poor response to coaching

As a mentor, you’ll mainly identify what is and isn’t working, plan steps that lead to improvement, and point underperformers in the right direction. It may sound simple, but the employee in question should be receptive to coaching as well to yield a positive outcome.

If the individual fails to progress or takes your advice poorly and becomes argumentative, their lack of results and negative attitude will undermine any further investment of time, money, and effort.

No interest in development

People placed in roles beyond their capabilities need further training, as do those who find it difficult to communicate effectively. Although most remediation efforts eventually produce improvements, positive changes cannot occur without the desire for it.

This specific factor can be tricky, as people who lack the aspirations to develop their abilities, particularly at the start of the process, won’t engage or gain the satisfaction of seeing visible results. That means you may have to make a tough decision as their performance journey progresses. If their interest doesn’t pick up, finding someone else may be your best option.

Lack of personal motivation

Personal motivation is the key to self-improvement. Although it’s hard to measure, this factor can make or break the success of an initiative; it enables an employee to accept coaching, power themselves through the development process, and engage with their work.

The strategies we’ve discussed can help cultivate motivation, but ultimately, it’s up to the individual to respond in kind. At a certain point, when it becomes clear the cost of trying to help an underperformer will exceed any return, it’s time to stop and replace them.

Wrapping up — Prevention is better than a cure

Managing and correcting your underperforming employees is critical to your organization’s success. By identifying the causes of their low productivity, providing guidance, and sustaining their motivation, you give them the tools to reinvent themselves and reach their full potential.

However, preventing poor performance is significantly less difficult and costly than resolving it after it manifests. By taking advantage of our library of assessments, you can identify an individual’s competencies and behaviors, then determine job fit as you hire for new roles or redefine existing ones.

Doing so averts performance dips before they arise and supports your company’s continuous flourishing. If you want to know more, get in touch today!

About the Author: Rachel