Whether a small restaurant of 5 employees or a large manufacturing company of over 500 employees, a business would not be able to operate day after day without employees. In fact, a strong group of employees is the backbone of any successful business. Many companies realize that retaining top talent in their organization is as important as ever.
Unfortunately, not all employees have excellent performance all of the time. Some employees may have poor performance on a rare occasion, while others may have poor performance from the day they were hired. Identifying and fixing poor employee performance is key to sustaining long-term business success. Let’s take a look at improving poor employee performance.
Reasons for poor employee performance
It’s frustrating when someone on your team isn’t meeting expectations—but the truth is, most performance problems don’t come from laziness or a lack of care. They usually stem from deeper issues in the workplace that can be fixed with the right support. Here are a few common causes of poor performance (there are countless others):
Lack of clear job expectations and career advancement
If an employee isn’t sure what success looks like in their role, it’s hard to expect them to hit the mark. Inaccurate job descriptions, unclear performance goals, or shifting priorities can make even the most capable employee feel lost or stuck.
And it’s not just about the day-to-day tasks—career growth matters, too. If team members don’t see a future at your company, they may feel less motivated to give their best effort. Clear communication about expectations and opportunities for advancement from the start can go a long way.
Poor onboarding, training, and understanding of the company vision
The first few weeks on the job set the tone for everything that follows. If onboarding is rushed or inconsistent, employees may never fully understand how to do their job well—or how their role fits into the bigger picture.
Without training and support, people are left to figure things out on their own. That leads to confusion, mistakes, and eventually, frustration. When employees understand the "why" behind their work and how it connects to the company’s goals, they’re more engaged and perform better.
External and personal issues
Employees are people first—and people go through things. Health problems, caregiving responsibilities, financial stress, or even major world events can all affect someone’s ability to stay focused and productive at work.
You won’t always know what’s going on behind the scenes, but creating a supportive and flexible environment makes it more likely that employees will feel safe to communicate and ask for help when they need it. A little empathy goes a long way.
What is an employee performance review?
Now that we have identified some causes, using performance reviews is a great way to improve poor performance. A performance review is a periodic evaluation of an employee. This process is often done by the employee’s direct supervisor or manager and can also consist of an employee self-review. Some of the topics covered in a review can include, but may not be limited to:
- Employee’s work performance
- The strengths and weaknesses of the employee
- Employee’s behavioral performance/issues
- Areas where employee can improve
- Future goals for the employee to achieve
In addition to the standard 90-day or annual review, many organizations now conduct more frequent and informal one-on-ones. Not only are reviews a great retention tool for any organization, they also promote employee satisfaction and engagement. When done correctly, performance reviews help recognize hard working employees, can fix small issues before they continue to grow, and will communicate company expectations and goals.
How can reviews improve employee performance?
Employee performance reviews are part of a bigger, more strategic company picture. Consider the following factors to help improve employee performance:
Implement a consistent and regular performance evaluation system
Employee reviews need to be performed consistently and fairly across the board. A well-constructed performance review system can provide a foundation for decisions on promotions, development, and terminations.
It is important to have a performance review policy outlined in your company handbook. Once you have the policy in place, make sure to follow it when it comes to all employees. Employees of certain protected classes need to be treated equally to all other employees. Conducting reviews with only a few employees or handing out negative reviews because of a disability can open your business up to potential discrimination claims. For example, if you have concerns about a receptionist’s rapidly declining typing skills, it could be attributed to a potential disability for which you may need to provide reasonable accommodations under the federal Americans with Disabilities Act (ADA).
Once you have completed the review, make sure to document and file the review in the employee’s personal file. This way, should disciplinary action or even termination be required later on, there is sufficient documentation of past employee work performance.
As employees shift positions within the company, it is important to conduct performance reviews with them. To keep the evaluation process seamless, conduct reviews:
- Before the employee transitions to another job position. The former manager should complete an evaluation.
- Prior to a manager or supervisor transferring to another job, he or she should complete an evaluation for each staff member.
Show employees the link between their individual performance and company performance and goals
During the employee onboarding process, employees should be made aware of individual goals and how they relate to the overall company goals. When conducting each employee review, make sure to track progress towards individual goals or establish new future goals. In addition, you can gather individual performance information to assess how a particular employee or team has been performing towards their goals and then how to remedy any deficiencies.
In the end, make sure to provide detail to the employee on how their work has contributed to the company goals and overall success of the business.
Directly address employee issues
Managers should address employee performance issues as they arise. Sometimes, there may be a perfectly valid reason for a performance or behavioral issue. For instance, an employee may have a family medical issue that involves the employee providing extra care for someone. Consequently, this is leading to the employee’s poor performance.
Engage in open and direct communications with employees regularly and often. By your managers being proactive, open and honest discussions help employees work through their work-related concerns. There should be no surprises when the formally scheduled performance review meeting occurs.
Empower your employees to improve
Empower your employees to take responsibility for their own development. Have them create an action plan for themselves to improve their work performance and reach their personal goals. Then, assist them by providing the resources necessary for them to reach those goals. This can be certain company equipment they may need to more efficiently perform their duties or sending them to a company training that enhances their skills or experience.
Follow-up, follow-up, and follow-up
Lastly, be sure to consistently follow up with employees after their review. By checking in with them often, managers can make sure the employee is on the right path to success. This also sends the employee a message that the expectations are being taken seriously and that managers are investing in the employee’s professional growth. Additionally, recognizing success along the way is key to keeping employees engaged and continuing to improve at their jobs. This can be done through verbal praise or even monetary rewards such as gift cards, bonuses, etc.
Employee Performance FAQs
You’re not the only one asking these questions—every small business owner we work with has wondered the same things. Here are some quick answers to help you feel more confident in managing employee performance.
How often should employee performance be evaluated?
At a minimum, performance reviews should happen once a year. But in reality, more frequent check-ins—like quarterly or even monthly—tend to work better. They help managers catch small problems before they grow and give employees the feedback they need to keep improving. You don’t need to make it formal every time; even a quick conversation can make a big difference.
How do you maintain employee motivation over the long term?
There’s no one-size-fits-all answer, but motivation usually comes from feeling supported, challenged, and recognized. Clear goals, consistent feedback, chances to grow, and regular acknowledgment of good work all help. When employees know their work matters and that they have a future at your company, they’re much more likely to stay engaged.
What team members should be involved in monitoring employee performance?
Direct supervisors or managers should take the lead, but performance management isn’t just a one-person job. HR can support the process by setting policies, offering tools, and helping with documentation. In smaller businesses without a formal HR team, it’s about making sure whoever oversees the employee is trained and consistent in how they approach performance conversations.
Can I use software to help in my performance review process?
Absolutely. There are lots of tools out there—some simple, some robust—that can help you set goals, track progress, document conversations, and provide scoring reviews for employees. Software can make the review process more organized, save time, and reduce bias by standardizing how feedback is given.
Conclusion
At the end of the day, improving employee performance isn’t about checking a box—it’s about building a stronger, more engaged team that can grow with your business. Whether it’s setting clearer expectations, offering better support, or simply having more regular conversations, small, intentional steps can lead to big changes.
Every business is different, and there’s no perfect formula. But when you take the time to understand what your employees need to succeed—and follow through with consistency and care—you set the stage for long-term success, for both your people and your company.
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