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The other common question that managers face in scaling startups is whether to put underperformers on a formal performance improvement plan (PIP). (iStockPhoto)
The other common question that managers face in scaling startups is whether to put underperformers on a formal performance improvement plan (PIP). (iStockPhoto)

Opinion | Dealing with underperformers at work is both an art and a science

Employees who are clear underperformers are relatively easy to spot and deal with

It’s that time of the year when appraisal forms are being filled and performance reviews are being prepared. With it, for many managers, comes the anxiety about dealing with underperformers or bad hires.

There’s some advice that Paul Spiegelman, the former chief culture officer of compliance training solutions company Stericycle, came up with that I go by: “Hiring a problem employee is bad. Not firing him is worse". Underperformance comes in different shades and colours.

Often, you can encounter a situation where you see improvement in performance after providing feedback, but as soon as you take your eye off, the person seems to regress. This is something you need to be careful about. Individuals who are clear underperformers are relatively easy to spot and deal with. It is those on the cusp who can impact your journey adversely because you are not sure if they would shape up eventually or would forever continue to be a drag. In a high growth company, you tend to be so occupied you don’t easily get to see the damage they are causing until it becomes very evident.

There is a simple tip that always works, and like anything that always works, it is not easy to practice: Don’t take your eye off such individuals, especially if they report to you or are in key roles even two levels below you. The reason you need to keep an eye on such individuals even if they are two levels below is because those who they report to (who are your direct reports) may not understand this nuance well enough to handle it proactively. Keep them on your radar till you decide one way or the other.

In my experience, those on the cusp do not eventually work out. Of course, there are exceptions. Every time you see some improvement after feedback, you hope the change is for the good, but later, you are again faced with the same issue. This slows you down and leaves you frustrated. So, you need to take quick calls in such cases. Take your eye away from an individual only if you believe that he or she is completely up to the mark both in terms of performance and work ethic.

The other common question that managers face in scaling startups is whether to put underperformers on a formal performance improvement plan (PIP). A PIP is a process that organizations have put together to ensure fairness and prevent cowboy-style managers perpetuating a hire-and-fire culture. I have seen situations where a manager doesn’t communicate expectations clearly and doesn’t take the time to review and provide feedback. As a result, there is a perception of underperformance. Initiating a separation based on such perceptions, without the manager doing his or her part well, sets off a culture of hiring and firing.

Treat a PIP as a test condition where you have taken care to clearly define expectations and are observing the individual closely. If your review mechanisms are good and effective, the need for a formal PIP is minimal. Good feedback, however, needs an open mind (for you as the provider of feedback). Be open to changing your position based on what you hear. An ability to change your position and acknowledge you were wrong can strengthen your reputation and make people even more open to feedback from you. I have seen some seasoned managers pulling off separations without a PIP just because at every stage they did what they were supposed to do—set expectations clearly, periodically review these and provide candid feedback.

Finally, when you take a call to let go of an individual, do it amicably. Maintain confidentiality. There is no need for anyone else to know that someone is on a PIP or has been asked to leave on performance grounds. An underperformer in a particular context can be extremely successful elsewhere. So, branding someone an underperformer is not right. Besides it can harm the individual’s reputation and jeopardize her chances of getting another job. Remember how you treat a separating employee has a huge impact on what the others think of you. Separated employees are some of your best brand ambassadors.

T.N. Hari is head of human resources at Bigbasket.com and adviser to several venture capital firms and startups. He is the co-author of Saying No To Jugaad: The Making Of BigBasket.

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