Retaining poor performers … wait, what?
Yes, that’s right. In a tight labour market, when skilled people are hard to find, you can’t afford to lose anyone. Effective performance management isn’t just about dealing with poor performers — it’s about lifting everyone’s performance, keeping your best people engaged, and strengthening your team overall.
Retaining your top talent is always important. But when you’re short on good people, it makes sense to invest time in transforming your lower performers instead of managing them out of the business.
So how do you support struggling employees and keep your high performers motivated?
Step 1: Recognise that managing poor performance is good for engagement
Top performers notice when you ignore underperformance. Failing to address it can frustrate and disengage them. On the other hand, when you tackle poor performance fairly and consistently, you reinforce a culture of accountability.
In other words, strong performance management doesn’t just improve results — it’s a staff retention strategy for your best people.
Step 2: Understand that different people need different strategies
Not all employees are motivated or skilled in the same way. You’ll need a different approach for each group:
- Top performers – Understand their underlying needs. What drives them? How can you stretch and challenge them so they stay engaged and growing?
- Middle performers – Identify what’s holding them back from being great. Is it a skills gap, unclear expectations, or a cultural barrier limiting their effort or confidence?
- Low performers – Explore why performance is low. Are they disengaged? Are their values misaligned with your organisation’s? Is there a gap in skill or knowledge, or is something outside work affecting their performance?
For some, improvement may not be possible. But for others, the right mix of feedback, coaching, and clarity can make all the difference.
Step 3: Build your own performance management skills
Before you start addressing underperformance, take an honest look at your own capability. How confident are you at:
- Giving clear, constructive feedback?
- Setting and communicating expectations?
- Asking great questions to uncover root causes?
- Listening — really listening — to what’s being said (and not said)?
Sometimes, underperformance stems from a lack of clarity or leadership skills. Strengthening your own performance management and communication skills is often the best first step. (And if you need help, check out our team leader development program, and communication skills training. We can also provide you with in the moment performance management coaching and support). And if you need it, we’ve got training on the entire end to end performance management process – check out our managing poor performance training course.
Step 4: Analyse performance objectively
When it’s time to discuss performance, come prepared. Gather clear, factual examples of where performance meets or falls short of expectations. Avoid vague feedback — specifics are essential for credibility and improvement.
Step 5: use a skill-will matrix
A simple but powerful tool in performance management is the Skill–Will Matrix:
- Low skill, low will: The toughest to turn around — consider whether the role is still the right fit.
- Low will, high skill: Often a sign of disengagement or personal issues. Explore what’s behind the lack of motivation.
- High will, low skill: A good problem to have — invest in training, mentoring, or shadowing.
- High skill, high will: Your top performers. Keep challenging and recognising them.
Knowing where each team member sits helps you decide where to focus your energy and how to tailor your approach.
(We have our own version of this called the ‘willing and able’ matrix. Find out more in our team leader development program).
Step 6: Prepare and hold the performance meeting
Plan your meeting carefully — but skip the script. The goal is a genuine conversation, not a lecture. Do less talking, more asking and listening.
Ask open questions, dig deeper when needed, and create space for honesty. If your employee isn’t used to this kind of discussion, it might take time for them to open up. You may need a follow-up session — and that’s fine. You’re building trust and ownership.
Encourage them to come back with their own solutions where possible. People are far more committed to plans they help create.
Step 7: Keep adjusting for personality and communication style
No two employees are alike. The way you communicate can make or break your message. Learn to recognise and adapt to different personality types or “Social Styles.” The more flexible your approach, the more likely you are to get results.
(If you’re not sure how to do that, our Social Intelligence training can help you build those skills.)
The bottom line about performance management
Performance management isn’t about punishing poor performance — it’s about unlocking potential, strengthening engagement, and setting clear standards across your team.
When done well, it turns performance conversations into growth opportunities — for you, your employees, and your business.
And if you or your managers need practical training or coaching to get started, we can help.
Photo by Tima Miroshnichenko: https://www.pexels.com/photo/a-man-having-one-on-one-meeting-with-a-counselor-5711123/
