Performance Management: A Step-by-Step Guide for Managers

The first time I had to fire someone was fifteen years ago. It went so poorly that he almost jumped over the table at me, and our company’s security guards had to drag him out of the building. (True story.)

Thankfully, that’s the roughest termination I’ve ever dealt with, and if you do a good job of developing your team and candidly sharing feedback when they go off-track, you can avoid most terminations entirely.

The purpose of this article is to provide some best practices around what good management looks like when a team member is performing poorly.

Most of the time, if you have the courage to share difficult feedback early and often with a struggling employee, they’ll be able to turn things around before it’s too late, which is a win-win for everyone.

Let’s Look at a Real-World Situation

Most articles about performance management are way too theoretical: they don’t tell you what to actually do and say during each step. To avoid that, I’ve tried to make this post as practical as possible.

We’ll walk through each aspect of performance management using a realistic situation that’s very similar to many examples I’ve encountered in the past decade while leading teams and training managers. Even if you work in a different industry than this example, you can apply the same principles and much of the same language.

Here’s the situation:

• You work in customer service.
• You’re a new manager, and your direct report Tommy is struggling.
• Tommy is a great guy. Everybody loves him. But unfortunately, Tommy has been completing many client tasks late, and he frequently drops the ball in a way that negatively impacts clients and colleagues.
• You know Tommy’s last manager talked to him a bit about this issue, but the problem persists. Now you want to dive into it because it’s causing issues.

3 Fundamental Truths

When managing a struggling employee, it’s important to accept these three things:

1. No one wants to do a bad job. Sometimes, people lose focus or motivation, but that doesn’t mean they’re a bad person or that they’re actively trying to do a poor job.
2. Sometimes an employee is a great fit in one company and a bad fit in another. Performance is a function of how closely someone’s skills and behavior match the specific job tasks, culture, manager, company, etc. Everyone wants to find a place where they can be their best self as a happy, productive, and successful worker. Just because someone’s not successful in one job doesn’t mean they won’t be successful somewhere else.
3. The best way to help someone be successful is to share feedback early and often. If you don’t give them feedback, they won’t grow and they won’t be able to address their weaknesses.

As Brené Brown says, “Clear is kind. Unclear is unkind.”

The Performance Management Process

There are many ways to work with poor performers to help them turn a corner, but here’s a helpful 6-step process to follow:

1. Observe & Investigate: See who’s doing well and who’s struggling on the team
2. Give Feedback: In every 1-on-1, give feedback about what’s going well and not going well
3. Stay Close: For employees who are struggling, watch their work more closely
4. Ramp Up Feedback: If the employee keeps making the same mistakes, provide more serious feedback. Give them a chance to improve.
5. Give a Warning: If the issue is serious enough, let them know that if the behavior doesn’t improve, they’ll lose their job (yes, it’s important to actually say this)
6. If the Situation Doesn’t Improve, Let the Employee Go: Partner with HR to terminate the employee and hopefully help them find a job that’s the right fit

Every company’s process and culture is a bit different, so be sure to partner with your HR team throughout this process. They may have a slightly different way of doing things, and they can also share any local laws and regulations you’ll need to consider.

Below, we’ll break down each step into further details.

Step 1: Observe & Investigate

Every employee has strengths and weaknesses. As you manage your team, pay attention to where each team member needs additional help and support.

Just because someone is struggling with something doesn’t mean it has to become a big hindrance to their performance. Provide them with more training, mentorship, guidance, and feedback to help them improve.

What Step 1 may look like in the situation with Tommy:

• You notice that Tommy is great at building relationships, proactively helping clients, and living by many of your company’s values.
• You also notice that Tommy seems to struggle with organization, time management, and following through on tasks.
• At this point, you’re not sure how much of an issue those weaknesses will be, but you want to help Tommy improve, so you give him feedback (Step 2).

Step 2: Give Feedback

When giving feedback, be sure to avoid common mistakes like assigning labels (like “lazy” or “slow”), sugarcoating feedback (making the situation sound better than it is), or sandwiching feedback (tucking your feedback between positive comments, which tends to just confuse the listener).

Instead, be clear and direct. It’s possible to be both candid and kind. Tell the employee what you’ve observed, and do so with specific, objective details.

Specifically, I recommend the SBI model for feedback. It’s quick, easy, and direct:

• Situation: Describe when the event happened
• Behavior: State specifically what they did or said that caused an issue
• Impact: Explain how their behavior could negatively affect the team, company, or clients

Step 3: Stay Close

Now that you’ve provided feedback, observe the employee to see if they improve in the area(s) you discussed.

• If they do -> Awesome! Then the rest of these steps are unnecessary. (This is always the goal.)
• If they don’t -> Then you’ll need to proceed with Step 4 and give more feedback.

One of the best ways to stay close to the situation and determine if the employee is improving is to audit some of their work. Some managers hesitate to do this because it feels like micromanagement, but real micromanagement is when you get unnecessarily involved in an employee’s work. If there is a performance issue, more involvement is indeed necessary.

It’s your job as a manager to ensure each of your direct reports is performing well. That often requires a different level of involvement with each person on the team.

• For your tenured or high-performing employees: You can probably be hands-off most of the time unless they ask for help.
• For new hires, inexperienced employees, and struggling employees: You should be much more intimately involved, including auditing their work, providing more advice and coaching, and sharing more feedback.

Step 4: Ramp Up Feedback

Once you’ve given feedback and noticed the team member still isn’t improving, you’ll need to provide feedback again, potentially even several times.

After a few times of doing this (the number depends on how problematic the issue is), you’ll want to ramp up the tone of the feedback you’re giving. Rather than just saying the same thing over and over, tell the employee that you’re getting increasingly concerned with what you’ve observed.

Here’s a helpful model for how to ramp up your feedback:

1. One-Off: The first time something happens, it’s not a big deal. Just share the feedback and give the person a chance to fix it.
2. Pattern: Once an employee has made the same mistake multiple times, you need to call that out. Make it clear you’re noticing a pattern, and they need to fix that pattern before it becomes a big performance issue.
3. Relationship: After you’ve called out the pattern and the employee’s performance still isn’t improving, ramp up the conversation further. Explain that this issue—if unaddressed—could cause them to lose their job. For some employees, this type of final warning helps them prioritize and fix the issue once and for all, which is great.