Managing Performance - Part Two: Clarity and Communication

By Deborah Lindemann

Managing underperformance presents as an unpleasant and complicated challenge for most small business owners. In the first part of this series we highlighted the risks of business owners acting too rashly, or not acting at all when faced with underperformance.  Now we are going to provide you with a practical and risk minimising approach to assist you in tackling underperformance to secure the best outcomes for your business.

There are four elements you need to keep top of mind when facing underperformance: Clarity, Communication, Cause and Consequence. In part 2 we look at Clarity and Communication.



In order for you to deal with underperformance effectively and fairly, it is imperative that you clarify the exact nature of the performance lack. You need to identify the problem.


Many people managers fall into the trap of over-generalising on underperformance. Don’t fall into the trap of over-generalising the matter along the lines of “Jo Bloggs doesn’t pull his/her weight,” or “She just doesn’t get it.” Ask yourself what Jo is employed to do, and what he/she is not doing. You need to undertake a simple gap analysis. Being aware of the exact nature of the issue will make it a lot easier for you to address the matter with the employee, and identify possible rectifiers. If you struggle to article the skill or competency lack, it may be helpful if you have a position description, role statement, or code of conduct you can refer to. In lieu of these it is worth undertaking some research or seeking resources from your industry body to ascertain what is normally expected of the position in question. Awards are also very useful resources as they include classification descriptions which cover off different levels of competency in a particular profession. If it is a behavioural issue, define what the behaviours are you expect to see displayed and compare this with what you are observing in the employee.



It may sound obvious, but you need to communicate the matter directly with the employee. The way you do this is important. To avoid running foul of legislated employee protections, and to award the employee dignity, we recommend providing reasonable notice of the performance discussion, and offering the employee the opportunity to bring a support person. Don’t fall into the trap of raising underperformance in amongst day-to-day operations, or in front of peers or colleagues. This could expose you in a number of ways. We also recommend that as a protection for you, all communications you have with the employee on the matter be documented in writing. This might be as simple as you making a diary or file note.

When you meet with the employee, use the conclusions you have drawn from your ‘Clarity’ exercise to frame your discussion. At the end of the discussion, there should be no ambiguity in the employee’s mind about the nature of the issue. Articulate what the problem is and why it is a problem. Provide examples of the substandard performance and being as specific as possible about dates and the impacts on the business or other people.

You then need to give the employee an opportunity to explain their views on the matter and explore possible causes or contributing factors which you might not be aware of, and explain to them what the potential consequences are if the underperformance is not addressed. 


Part 3 of this series looks at ‘Cause’ and ‘Consequence’.