Archive for May, 2009

Reactions to a shrinking economy take many forms. One common reaction is to minimize or halt performance and development programs. The rationale appears to be that they are significant budget line-items, and – notwithstanding the original investment in creating them and communicating their value to the long-term success of the company— they are often considered non-essential when push comes to shove.

A tight economy is the absolute WORST time for leaders to de-emphasize performance management. For one thing, people have very long memories. While top performers are typically team players who will ‘take one for the company’ in tight times, if they see money being wasted while they are foregoing salary increases, bonuses or promotions, their loyalty is likely to plummet.

What about those under-performers who are still hanging-out month-after-month [in too many cases, year-after-year], soaking up resources that are becoming more scarce? Don’t kid yourself: performers always know who the under-performers are, and they always question why nothing is done to either boost their productivity or move them out. When leaders fail to fix known problems, their credibility deteriorates. When the economy turns around and opportunities are more plentiful, the best performers are more likely to be enticed to an organization whose leadership is perceived to be action-oriented and progressive. 

The opportunity-cost of enabling under-performers is monumental — especially in a lean economy. You can’t invest money in sales, marketing, innovation or better talent when you’re investing it in under-performers who aren’t adding to the bottom line. And when it comes to talent, what isn’t additive is clearly subtractive. Under-performers not only don’t provide a return-on-investment; they often—directly and indirectly—undermine morale, culture and eventually the energy and commitment of your top producers. 

One reason under-performers are often not held accountable for meeting expectations is the realization that they may not be totally at fault for their inability to perform. Leaders often feel a sense of responsibility for people they’ve hired or promoted beyond their level of competency. But regardless of how they got there, leaving someone in the deep end of the pool has negative results—for the under-performer, other employees, and the company.


An objective professional reviews the deliverables and performance expectations to succeed in the job, performs an assessment of the individual’s skills, capabilities and personality characteristics, and develops a gap analysis and recommendations. The outcome is typically an action plan which includes communications regarding how to bridge the gap, specific action steps to turnaround, develop or re-assign the underperforming individual, as well as how to coach, measure, and document the process.

Best case: the performance plan is successful and the individual becomes a valuable contributor. Worst case: the process to help the individual find a better future has been managed in an effective, empathetic and legally defensible way. The action plan can be implemented by internal management, or in collaboration with the performance consultant. 

Originally printed in www.TheStage1.com Performance eNews Bulletin 1 2009.


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