If you're feeling like your staff just aren't doing their very best work - then it's probably time to review or maybe even implement performance management processes in your business.
Like everything else, we have to begin with where we are now. What do you currently do to manage performance of your staff? Do you have annual appraisals? Do you have monthly appraisals and 1:1s? Do you have anything in place?
Remember there is no right or wrong with this stuff - the important thing is that we look for ways to improve on where we are now.
So if you have nothing at all in place to manage performance, your next job is going to be to put something in place. Start small, maybe with just regular 1:1 meetings with your employees and build from there.
If you have things in place but you don't feel they are working - we need to make sure the process is supporting what you are trying to achieve.
Annual appraisals are on their way out - for the simple reason that people can barely remember what they did last week, never mind their achievements over the course of a year! That's like never looking at your profit margin until the end of the year, by which point it's too late to change anything!
So if that's your current process, I would consider holding more regular, shorter appraisal meetings with your staff. Regular performance meetings make it easier for you and your employee to stay on track with their targets, tweak any issues, provide support and generally make sure everything is as it should be. It also means that once the employee has hit their target, you can set them a new one that further supports your end goal.
If you use performance reviews to decide which staff receive performance related bonuses or pay increases, then I would suggest standardising the way in which you hold these reviews to make it easier to make such decisions in a fair and transparent way. One way to achieve this is to have a form which is completed at every review with every member of staff to standardise the information.
You should also review the goals and targets you set for your staff regularly to make sure they support the overall goals of the business. If you want to see an increase in profit margin, then you need to set goals for staff that relate to making or saving more money. We also need to think about setting goals that challenge and develop our staff. We want them to be able to progress within our businesses so that we keep all that knowledge and talent that we have nurtured for ourselves!
Finally, we have to think about what we do about poor performance. Firstly, we need to make sure we know the difference between poor performance and misconduct.
Poor performance happens when an employee is trying their best, but they're just not getting it. There's something they require extra training on.
Misconduct happens when an employee deliberately does something or fails to do something on purpose.
For example: An employee making lots of mistakes when they place online orders with suppliers because they don't understand the system is a performance issue. An employee failing to place the order altogether because they decided it wasn't needed is a misconduct issue.
We need to ensure that we have procedures in place to support employee performance issues to either improve or unfortunately, be managed out of the business if no improvement is made. The first step in managing poor performance is to let the employee know that there is a problem, and agree a way forward to resolve the problem. If that doesn't fix it, it might be time to bring in the big guns...HR!