So, you’ve got a team member who isn’t hitting the mark, and you’re stuck wondering what to do. I get it—managing underperforming employees can feel like you’re navigating a minefield, trying to figure out the right approach without derailing the team or damaging relationships.

You’re not alone, either. Nearly every manager faces this challenge at some point, and it’s a task that can test your patience, empathy, and problem-solving skills. A report from Gallup found that only 21% of employees strongly agree that their performance is managed in a way that motivates them to do outstanding work. With stats like these, it’s clear that employee performance management is a widespread issue—one that managers across the globe are working to improve.

The good news is that managing underperformance doesn’t have to be about delivering tough talks or giving up on employees. In fact, many cases of underperformance are reversible if approached with strategy and empathy. According to a study by the Society for Human Resource Management (SHRM), companies that provide clear expectations, ongoing feedback, and development opportunities see a 24% improvement in employee performance. So, there’s a science-backed path to success here!

In this guide, we’ll explore strategies to help you identify the cause of underperformance, set clear expectations, provide the right resources, and more—all with the goal of turning things around for your team member and creating a healthier, more productive work environment.

Step 1: Identify the Core Issue

The first and most crucial step it to Dig into the root cause of the underperformance. Think of this as detective work—it’s time to understand the “why” behind the lackluster results. Underperformance can stem from a variety of factors, and research shows that approaching this with empathy and curiosity can lead to better outcomes.

Possible Reasons for Underperformance

• Role clarity issues: A study from McKinsey highlights that lack of role clarity is one of the biggest barriers to employee productivity, so if your employee isn’t clear on their responsibilities, they’re more likely to fall short.

• Training gaps: According to research from LinkedIn, 94% of employees said they would stay longer at a company if it invested in their career development, suggesting that underperformance may sometimes be due to inadequate training.

• External or personal factors: Work isn’t always a bubble. Personal struggles, like family issues or health concerns, can have a massive impact on performance.

Approaching this stage with open-ended questions and huge empathy can help your employee feel supported rather than scrutinized. And as you do this, remember that your goal is understanding, not judgment.

Step 2: Communicate Clearly and Set Realistic Goals

Now that you have a sense of the underlying issue, it’s time to lay down a path forward. Clear communication is essential here. Research suggests that employees who have clear goals and understand how their work impacts the company’s overall objectives are 2.8 times more likely to be engaged. Here’s how to communicate and set goals effectively:

Tips for Goal-Setting

1. Be specific: Set clear, specific objectives that directly address the performance issues. Avoid vague directives like “improve your work” and instead say, “I’d like you to meet X targets by the end of the month.”

2. Define a timeline: Giving a clear timeframe (e.g., three months with a mid-point check-in) adds a sense of urgency and structure. This is known as “goal anchoring,” which has been shown to improve commitment and follow-through.

3. Outline consequences and rewards: Frame it positively—maybe they’ll get more responsibility if they meet the goal, or a public acknowledgment. Keep in mind that rewards can be more effective motivators than consequences.

This step helps you establish a shared understanding of what improvement looks like. It also prevents ambiguity, which is a common barrier to performance enhancement.

Step 3: Provide the Right Support and Resources

Imagine being asked to paint a house but only given a few tiny brushes and no ladder—it’s an impossible task. Similarly, underperformance can stem from an employee not having the right resources to succeed. Providing adequate resources, from tools to mentorship, is an investment that often pays off. According to Gallup, employees who feel they have the resources needed to do their job are over twice as likely to be engaged at work.

Support Tips

• Offer training opportunities: It could be a course, a workshop, or even just time with a senior team member. The World Economic Forum has found that upskilling and reskilling employees leads to a more agile and productive workforce.

• Create a mentorship system: Sometimes, pairing the employee with a peer who excels in the area of concern can boost their confidence and capabilities.

• Ensure they have the right tools: Software, equipment, or even project management tools can make a difference by streamlining communication and helping them manage their tasks more effectively.

Offering the right support shows your commitment to their growth and makes it easier for them to achieve their goals.

Step 4: Check In Regularly and Provide Constructive Feedback

Setting goals and providing resources is only half the equation; you also need to ensure they’re staying on track. Regular feedback sessions are crucial because they create a space for accountability, encouragement, and course correction. According to a survey by Officevibe, 82% of employees value feedback—whether positive or negative—if it’s delivered constructively.

How to Give Effective Feedback

• Make it frequent and timely: Schedule bi-weekly or monthly check-ins to review progress.

• Keep it constructive: Feedback should focus on specific behaviors and solutions rather than general criticisms.

• Acknowledge improvements: Even if progress is small, recognize it! Acknowledgment encourages them to keep pushing forward and reminds them that improvement is possible.

Keeping track of these interactions - document progress and refer back to past conversations, can help you (and your employee) stay aligned on goals.

Step 5: Reevaluate and Adjust as Needed

Despite your best efforts, sometimes improvement doesn’t come. If you find that performance is still lagging even with support, it may be time to evaluate if a role adjustment is necessary. Research from the Harvard Business Review suggests that misalignment between an employee’s skills and their role is one of the most common causes of underperformance. Ask yourself:

• Is there a better role or department fit? If they’re a good cultural fit but the role isn’t right, consider a lateral move.

• Is termination the best choice? As a last resort, if you’ve exhausted other options and they’re still not meeting expectations, it may be time to part ways. Though difficult, making the right call at this stage is essential for team morale and productivity.

Step 6: Document Everything

Documentation is key for two main reasons: it keeps both you and the employee on the same page, and it’s crucial if you need to make a final decision about their employment. Document every conversation, goal, feedback session, and progress (or lack thereof).

Using digital workplace hubs can simplify this process by keeping all your notes, goals, and feedback in one place. This way, you have a clear record to refer back to at each check-in and when making decisions about next steps.

Step 7: Boost Team Morale and Prevent Future Underperformance

Underperformance affects the whole team, not just the individual, so after you’ve handled an underperformer, take time to re-engage the rest of the team. According to the CIPD, open communication and acknowledgment of team contributions help foster morale and create a positive work environment. Here’s how you can make sure the team stays motivated:

• Frequent check-ins: Create a routine of quarterly feedback sessions for every team member.

• Recognition programs: Public acknowledgment for high performers can encourage the whole team to maintain a high standard.

• Training and career development: Regular training helps prevent underperformance by keeping everyone’s skills sharp and aligned with team goals.

Final Thoughts

Addressing underperformance isn’t easy, but it’s an opportunity for growth—both for you as a manager and for the employee in question. With patience, consistent communication, and strategic support, you can help your underperforming employees turn things around.

When you need the right tools to track performance, set goals, and communicate effectively, we are here to make that process seamless. Supporting employees with a system in place helps everyone stay on the same page and increases the chance for success.

Want more management insights? Check out Pebb’s blog for more articles on leadership, team building, and productivity!