When you run a small business, every minute and dollar counts, and the decisions you make can have a huge impact on your bottom line. In addition, employees’ negative performance and behavior can have a greater effect on productivity, efficiency and morale than the same behavior might have at a larger organization.
Still, when employees are failing to meet the requirements or expectations of the job, don’t be quick to fire them. The process of recruiting, hiring and training a new employee is time-consuming and costly. In most cases, your best bet for maintaining productivity is to coach employees to improve their performance rather than leaving your team short a member.
Follow these steps to bring struggling employees’ performance up to your expectations:
1. Evaluate the situation
If an employee is not meeting the requirements of the job, think about what could be causing the performance slip. Be honest with yourself.
- Have you written a detailed job description and established goals for the employee?
- Have you provided the employee with adequate training?
- Have you spelled out the expectations for the job?
- Are your expectations for the employee realistic?
- Is the person’s workload reasonable?
Often, with a bit of soul-searching, you will discover that you could be doing more to ensure that all of your employees perform at a high level.
2. Address the issue immediately
As soon as you are aware of performance problems, meet privately with employees. Explain that you have noticed a slip in performance or describe how an employee is failing to meet the goals or requirements of the job. Share specific instances where the behavior was problematic, and provide evidence of how the issue is adversely affecting the team. For example: “You didn’t submit the orders on Friday as I requested and waited until Monday to do so. As a result, we had to rush several shipments to clients for free. It cost us about $2,500.”
Employees may immediately become worried or defensive, so let them know that your priority is to bring their performance up to an acceptable level because you value their contributions and want to keep them on staff—not to punish them.
Do not make threats or ultimatums. Never belittle or insult. Instead, show employees that you care about them by conducting two-way conversations where both you and employees create a plan for making improvements.
3. Allow employees to share their point of view
It is possible that employees don’t even know that they are falling short of expectations. In some cases, they may have a legitimate reason for their low performance, for example, they are having personal issues or their workload has become unrealistic. Simply saying, “Tell me what’s going on,” is often enough to prompt them to share their struggles. Encourage them to open up by asking more than “yes” or “no” questions. Do not interrupt as they talk, but do respond to any questions or concerns they have. Once they have finished speaking, point out areas where they are incorrect or seem confused, and provide them with accurate information.
4. Be clear about your expectations
Tell employees exactly what you want them to do to improve their performance rather than using vague or passive language. For example, say, “You must turn the reports in by 3:00 p.m. every Wednesday,” instead of, “I’d like for the reports to be turned in on time.”
Be clear about what they stand to gain if they fulfill expectations and what they will lose if they don’t. For example, state that you will consider the employee for promotions and other opportunities if you see marked improvement, however if you fail to see improvement, you will have to consider other options, including termination. It is a smart idea to document the goals and ask employees to sign and date the document. That ensures that they understand your expectations and are committed to making changes, in addition to preventing legal issues such as wrongful termination claims down the road.
When you are a time-strapped small-business owner, sometimes it can seem like the fastest, most painless way to deal with bad employees is to cut them loose. When you fire an employee, however, you can kill the morale and productivity of the rest of your staff. More often than not you will find that the time and effort you put into coaching a poor performer is worth it, as it pays dividends in the form of employee engagement and loyalty.