At the end of the year, when performance appraisals are done for making decisions to feed into compensation and review process. I have seen managers getting uncomfortable to communicate about the poor performance of their B10 (Bottom 10 percentile) employees. In many companies, B10 performers do not get any hike in their compensation. This makes the manager even more uncomfortable to have the performance discussion with their B10 employees. Before we get to the communication aspect, let's dwell on the impact of the poor performers on the overall organization. You defeat the purpose of hiring great people if you fail to deal with poor performers inside the organization. It is like taking a favorite drink and watering it down. The weak links in your team determines the pace and overall success of the team. The question you need to ask yourself is “Would you rehire this person if given a chance?” If the answer is NO, then you need to either TRAIN them to equip them with right skills or TRANSFER them to another function to match their competency or TERMINATE Keeping the wrong person lowers the collective self-esteem of the entire team. Keeping the wrong person diminishes your credibility as a leader - You will lose respect of the best, when you don't deal effectively with worst. Remove poor performers when you are on a roll, do not wait until the bottom falls out : The best time to fix the roof is when the sun is shining. I believe no employee is bad. It is just that they may not meet the expectation of the current job. My favorite example, to drive home this point, is that of engineers finding jobs in different companies. It is not that all companies hire only engineers from IITs. Every engineer finds a job depending on their meeting the expectation of the company that hires them. So, as a manager, you need not feel bad that you are firing a poor performer. It is just that he does NOT meet your organization's expectations. As a matter of fact, you will be doing great injustice to their career by retaining them in your group : You will give far below average hike, as he/she is B10. Year over year the B10 employee would be getting lower hikes. By letting them go, they will find other companies where their talent meets/exceeds that company's expectation. In my career, I have seen B10 employees who left my organization, growing well in other companies. As a manager you should care enough to confront the poor performers. Confronting is like tough love. Be polite but firm, in giving the feedback as to why they are performing poorly. Have data to back your qualitative feedback. Have 3 to 4 top feedbacks to drive home the point. Most of the companies have the process of PIP (Performance Improvement Process). Put them on this process, by redefining expectations and attach deadlines for attainment. At regular intervals give them the feedback. Do not wait till the end of the PIP tenure to give feedback. If you feel, the employee is not improving, then be open to them and ask them to look for opportunities outside of your company. He can use the remaining period of the PIP tenure to actively search for another job. Firing an employee based on poor performance is not easy, but then who said being a manager or leader is easy.
The Courage to Deal with Poor Performers
Why This Matters
Tolerating poor performance destroys team morale and drives away your best people. Your team's weakest member sets the pace for everyone else. When you avoid difficult performance conversations, high performers lose respect for you and either leave or lower their own standards to match those around them. The temporary discomfort of addressing underperformance pales in comparison to the permanent damage of ignoring it.
Leadership in Practice
A major streaming company famously instituted what they call a performance evaluation approach - managers regularly ask themselves, "If this person told me they were leaving, would I fight to keep them?" If the answer is no, the company expects managers to have that difficult conversation immediately and part ways with the employee, offering a generous severance package. This policy emerged from the CEO's experience watching talented employees become frustrated working alongside underperformers. In one notable case, after a round of layoffs during an economic downturn, the remaining team members reported being happier and more productive despite the increased workload. This counterintuitive result demonstrated that removing underperformers had actually improved team dynamics and effectiveness. The company's approach has enabled them to maintain one of the most talented workforces in the tech industry. While their methods may seem harsh, employees report appreciating the transparency and the consistently high caliber of their colleagues. This case demonstrates that addressing performance issues decisively, while difficult, ultimately benefits everyone - including the underperformer who moves to a better-fit environment.
Leadership Framework
The 3T Framework for Addressing Underperformance:
1. TRAIN - First, determine if the performance gap is due to a skills deficit. Provide specific training, mentorship, and resources. Set clear expectations and timeframes for improvement. Document all training provided.
2. TRANSFER - If training does not resolve the issue, assess whether the employee might excel in a different role within the organization. Sometimes a mismatch between role requirements and individual strengths is the root cause. Explore internal mobility options that better align with their capabilities.
3. TERMINATE - If training and transfer options have been exhausted or are inappropriate, make the decision to part ways. Do so respectfully, with dignity, and with appropriate notice or severance. Document the process thoroughly to protect both the individual and the organization.
Critical Success Factors: - Act early when performance issues emerge - Use data and specific examples, not generalizations - Provide regular feedback throughout the process - Maintain professional respect regardless of outcome - Document all steps for legal and ethical protection
Leadership Takeaway
Your responsibility is to the mission and the team, not to individual comfort. Every day you keep an underperformer, you choose avoidance over excellence. Honest feedback benefits everyone - it helps underperformers find better-fit roles and shows your top performers that standards matter. As a leader, it's not what you preach, it's what you tolerate.
Ramu Kaka's Wisdom
Remember: It is not what you preach as a leader, it is what you tolerate. The standards you walk past are the standards you accept. Your team is watching to see if excellence is truly valued or merely proclaimed. Your best people will not wait long for you to decide.
Reflection Questions
- If each of my team members told me today they were leaving, which ones would I genuinely fight to retain? What does this tell me about actions I need to take?
- What is the real cost to my team's morale and productivity of retaining my lowest performer? How much of my time do they consume versus my top performers?
- What specific fears or discomfort am I allowing to prevent me from having necessary performance conversations? What would become possible if I addressed this issue this month?
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