To manage underperforming employees, name the gap in specifics, find out why it exists, and fix the cause rather than the symptom. Most of the time the cause is a skill the person was never taught, so the fix is training that builds that skill, checked at the next check-in.

This guide gives you a seven-step process, a map from common performance problems to the skills behind them, and a worked example of what the training looks like in practice.

What Is an Underperforming Employee?

An underperforming employee is someone whose work falls short of clear, agreed expectations, repeatedly and over weeks, not once. One missed deadline is a bad week. Three in a quarter is a pattern.

Underperformance is about results. A difficult employee is about behavior: the person may hit every target while making the team miserable. The two need different conversations, and mixing them up is how a manager ends up arguing about tone when the real issue is a missed number.

Poor performance also has a short list of root causes. In our experience they fall into four groups:

• Clarity: the person doesn't know what good looks like.
• Skill: the person knows what good looks like but can't produce it yet.
• Motivation: the person can do it and has stopped trying.
• Circumstance: health, family, workload or a broken process is getting in the way.

The fix depends entirely on which one you're looking at.

Why Underperformance Is Usually a Management Problem First

Underperformance usually starts with an unclear expectation or an untrained skill, and both trace back to how the work was set up. Gallup found that only 49% of U.S. employees strongly agreed they know what is expected of them at work in the first half of 2026. If half your people aren't sure what the job is, some of your underperformers are doing the wrong job well.

The conversation itself is a skill, too. In a July 2026 survey of 399 managers by The Predictive Index, 42% said they know what they want to say but struggle with how to say it. So the talk gets delayed, softened or skipped, and nothing happens after it.

That's the honest starting point for an HR leader. Many of the managers handling underperformance were promoted for doing the work well and never trained to manage it.

How to Manage Underperforming Employees in 7 Steps

Manage an underperforming employee by moving from evidence to cause to one practiced fix, then checking it on a schedule. Here are the seven steps.

1. Write Down the Gap in Specifics

Start with what happened, not what you think of the person. "The weekly inventory report was late four of the last six Mondays" is a fact. "She's not reliable" is a conclusion, and it will start an argument.

Write two or three examples with dates and the effect on the team or customer. If you can't find examples, you don't have a performance problem yet. You have a feeling.

2. Check Whether the Expectation Was Ever Clear

Confirm the standard was stated, in writing or out loud, before you hold someone to it. Look at the job description, the last review and your own messages.

If the expectation lived only in your head, the first fix is yours: state it plainly, agree on it and give the person a fair window to meet it.

3. Find the Cause Before You Pick the Fix

Ask open questions and listen more than you talk. "Walk me through how you put the report together" tells you more than "Why is it late?"

Listen for which of the four causes you're hearing. Clarity sounds like "I didn't know that was due Monday." Skill sounds like "I start it Friday and it always takes longer than I think." Motivation sounds like "Does anyone even read it?" Circumstance sounds like something personal, and it belongs with HR and your employee assistance program, not a training plan.

4. Have the Conversation Within a Week

Hold the conversation soon after you notice the pattern, in private, with your examples in hand. Waiting until the annual review turns a fixable gap into a surprise.

A simple opening works: "I want to talk about the Monday report. It's been late four of the last six weeks, and the warehouse team is planning without it. I'd like to understand what's getting in the way and agree on a plan." Then stop talking.

If you'd like the review side of this, our performance review examples by rating level show how to put a gap in writing without softening it into nothing.

5. Agree on One Next Step and the Training to Take It

End the conversation with one specific next step, not a list of ten. "Get better at deadlines" is not a step. "Build a three-day plan for the report every Wednesday and share it with me" is.

Then attach the help. If the cause is a skill, the next step needs practice, not a reminder. Name the training, the format and the date it happens.

6. Check Progress at Every Check-In

Put the next step on the agenda of your regular one-on-one and look at the evidence each time. Our one-on-one meeting template has a slot for exactly this.

Recognize progress out loud and in specifics. A person working to close a gap needs to hear when it's closing.

7. Decide at the End of the Window

Set a review date when you agree on the plan, then make a clear call on that date. There are three outcomes: the gap closed, it's closing and you extend, or it hasn't moved and you escalate.

Escalation usually means a formal performance improvement plan with HR. A note on that: this post is not legal advice, and any plan, warning or termination should be checked with HR or employment counsel before you act.

Name the Skill Behind the Performance Problem

Most performance problems are skill problems wearing a different name. Name the skill and you know what to train; leave it unnamed and you're left repeating the same feedback louder.

Use this map in your next conversation. Each line gives the symptom, the skill behind it, what the person practices, and how you check it at the next check-in.

• Missed deadlines: planning and prioritization. Practice breaking one real project into dated milestones and protecting time for them. Check: milestones hit at the next two check-ins.
• Errors and rework: process discipline and self-review. Practice building a short checklist for one recurring task and using it before handoff. Check: error count on that task over the next month.
• Vague or late status updates: written communication. Practice a three-line update format (done, next, blocked) on real work. Check: updates arrive on time and you stop chasing them.
• Friction with peers: difficult conversations. Practice raising one live disagreement directly, rehearsed first. Check: the issue is resolved without you stepping in.
• A new manager whose team is slipping: delegation and coaching. Practice handing off one task with a clear outcome and a check-in date. Check: the task gets done without the manager redoing it. This is the core of most new manager training.

The manager's side matters as much. If the conversation keeps getting delayed or ends without a step, that's a feedback skill gap in the manager, and it trains the same way. Our guide to conflict resolution training covers what to look for when the gap is in how people handle disagreement.

This is the part most performance processes skip. The review finds the gap, the form records it, and nobody gives the person a way to close it. At Bundle, we connect what the review or check-in finds to training that builds the missing skill, then check the result at the next conversation.

How the Approach Changes by Company Size

The steps stay the same at every size. Who runs them, and how formal they get, changes.

• Small companies (under 100 employees): there's often no HR team, so the founder or a senior leader handles underperformance directly. Keep the process light but written: dated examples, one next step, one check-in date. Training here is usually one person at a time, so live one-on-one sessions fit better than a group program.
• Small to mid-sized companies (100 to 500 employees): this is where underperformance gets expensive and inconsistent. There are enough managers that each handles it differently, and most were promoted without training. HR's job is to give every manager the same steps and the same way to attach training to a next step, so the process doesn't depend on who your boss is.
• Large companies (over 500 employees): the process usually exists on paper, with HR business partners and formal plans. The risk is the opposite: it becomes a checked box. Audit whether plans name a skill and a training, or only a deadline.

What Everyone Gets Right, and What They Miss

Most advice on underperformance says to document everything, set clear goals and move to a formal plan if things don't improve. That advice is right. Without a paper trail, you can't be fair to the employee or protect the company.

What it misses is the middle. A plan that lists goals and dates but no new skill asks the person to do the same thing harder. If they couldn't plan their week in March, a document doesn't teach them to plan it in April.

The question to ask of any improvement plan is simple: what will this person practice, with whom, and how will we know it worked? If the plan can't answer that, it's an exit plan with extra steps.

Our guide to the annual performance review makes the same point at review time: every rating should end with a next step and the training to take it.

Frequently Asked Questions

How do you tell an employee they are underperforming?

Tell them privately, soon, and with specific examples. Describe the gap and its effect, ask what's getting in the way, and agree on one next step before you leave the room. Avoid labels like "unreliable" and stick to what happened.

What are the signs of poor performance at work?

Look for patterns: repeated missed deadlines, errors that keep coming back, work that needs redoing, and colleagues quietly working around the person. Withdrawal from meetings or a sudden drop in quality can also signal a personal issue, which calls for a different conversation.

How long should you give an underperforming employee to improve?

Give a defined window tied to the skill being built. For formal plans, employment attorney James McDonald told SHRM in July 2025 that a PIP should run a minimum of 30 days, with 60 or 90 days more customary, and that check-ins should happen weekly or biweekly. Before a formal plan, a few weeks with a clear next step is often enough to see whether the gap is closing.

How do you manage a difficult employee who still hits their numbers?

Treat it as a behavior problem, not a performance problem. Name the specific behavior and its effect on the team, and agree on what changes. The skill behind it is often communication or handling conflict, and it can be trained like any other.

When should you move to a performance improvement plan?

Move to a formal plan when you've had the conversation, agreed on a next step, provided the help to take it, and the gap still hasn't moved by the review date. Bring HR in before you write it.

The Next Step Is the Whole Point

Underperformance rarely fixes itself, and it rarely fixes with a louder version of the same feedback. It fixes when someone names the skill and practices it.

Bundle's live, expert-led manager training gives your managers and their people the practice to close those gaps, one skill at a time.