Exclusive B21 Survey: Companies are Way Too Tolerant of Poor Performers

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A new survey from Business 21 Publishing shows that the majority of HR executives believe their companies are "way too tolerant" of poor performance. Only 3% felt that their companies have performance management systems that allow them take quick action to deal with poor performers. A third felt their managers let people "get away with murder."

A new survey from Business 21 Publishing shows that the majority of HR executives believe their companies are "way too tolerant" of poor performance. Only 3% felt that their companies take quick action to deal with poor performers. A third felt their managers let people "get away with murder."

A follow-up survey showed that HR executives are acutely aware that the consequences of tolerating under-performers are devastating to the organization. It showed that 36% of respondents felt that inaction in this key area undermines confidence in management, and that 42% believe it erodes the morale of their best people.

These results concur with previous B21 polls showing that of all topics related to HR, including hard-core compliance issues, performance management consistently comes out on top as the number one HR challenge.

The follow-up survey reveals the insidiousness effects of [tolerating poor performers. Almost no one (just 4%) is concerned about the costs associated with encouraging slackers. And only a few point to the hard-to-measure negative impact on results. The real downside is at the level of perception. More than a third express concern that when a company tolerates poor performance, employees lose respect for senior management. And the highest percentage, 42%, point to the fact that top performers became angry and/or demoralized when they feel like they're giving their hearts and souls to a job, while others are allowed to merely get by. This is the most powerful insight from the study: Your best people want to make a difference in their jobs. To do that they want to associate with winners, who are as dedicated to making a difference as they are. When the organization tolerates the uncommitted, it's devastating to top performers.

The big question, of course, is why companies tolerate poor performance. The answer to that question is simple: performance management is REALLY, REALLY difficult. Performance management is a complex process that starts with getting the right people in the right jobs. It's about organizing work efficiently in departments. It's about motivating people by showing them how their daily activity contributes to something far greater ("the big picture"). It's about coming up with measurable goals that align individual behavior with company goals, and rewarding people when they behave appropriately and hit their goals. And, of course, it's about [reviewing performance, which almost every company does very poorly.

At every stage in this process human beings, usually managers, have to intervene. They have to make the right choices at the outset -- What's your job? What are your goals? What do you get if you hit them? They have to have the courage to confront poor performance. And they have to know what to do once they confront it. The reason the B21 survey showed such high tolerance for poor performance is that far too many managers have no idea how to cope with the complexities of managing their people. They fall into all the obvious traps: setting goals with no line of sight to results; failing to follow up and INspect what they EXpect; practicing avoidance and not confronting poor performance when they see it; and conducting meaningless performance evaluations that at best have no impact and at worst deflate morale and set your company up for a lawsuit.

Here are some resources on performance management:

WHITE PAPER: From the Hay Group, an article entitled: "Managing Performance: Achieving Outstanding Performance Through a 'Culture of Dialogue' " It addresses the complexities of PM and offers a blueprint for doing it right.

AUDIO CONFERENCE: Why Underperformers Underperform -- and What to Do About It, a 60-minute event on Thursday, June 29 at 2pm EST, by Glenn Shepard, one of B21's top-rated speakers and the author of the best-selling book How to Be the Employee Your Company Can't Live Without.

To see the complete survey results, visit the HR Intelligence Center, an online resource for HR professionals, including articles, quizzes, forms, sample policies and more.

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Stephen Meyer
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