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As bosses grow skeptical about employee productivity, one prominent entrepreneur is advising managers to keep tabs on who is—and isn’t—pulling their weight.
According to Jay McDonald, an Atlanta-based executive coach and entrepreneur, managers should keep mental lists of the people they’d cut in case they find themselves having to let people go.
“Business leaders should always rate their people from the most productive and valuable to the least, in case they have to reduce their workforce,” he told Fortune.
“Everyone is facing economic headwinds, not just from rising interest rates and supply chain issues… inflation is at record highs. People are paying more for labor, materials and so forth, and all of that can’t be passed on via price increases.”
While the list-making practice may sound somewhat callous, McDonald—who currently works with more than 100 CEOs, business owners and executives—contended that employees could also benefit from the listing technique.
“It also makes sure leaders are rewarding and paying attention to the top performers too,” he said. “Any business should be evaluating its return on investment of technology, of success, of people.”
McDonald said the context of the list was to look at what individual workers do and evaluate how productive their role is—which might not necessarily correlate to how hard they work.
“They might be a great employee but need technological innovation, in which case you’d want to hold onto them,” he said. “You can also keep a list in the context of what you’re paying people versus the return on investment to customers, your objectives, and so on.”
Finding solutions
While business leaders told Fortune keeping up to date with employee performance was important, they agreed that there were paths both employers and workers could pursue to prevent the lower-ranked workers from losing their jobs.
Alina Vandenberghe, co-founder and co-CEO of tech start-up Chili Piper—which has a fully remote workforce made up of around 250 employees—told Fortune that while keeping tabs on underperformance could benefit both parties, employers were often at fault for underperformance, usually due to a lack of clear communication.
“Underperformance can happen for a variety of reasons, such as required skills not being clearly defined during the hiring process, the skills required have changed but weren’t communicated well to the employee, or the employee simply isn’t motivated to execute their career goals,” she said.
“It’s critical to track which of these categories an underperforming employee falls under so managers and leadership can take the appropriate action to help them succeed.”
Vandenberghe suggested that employers could use digital progression trackers to identify and measure the skillsets required for individual roles at their company.
“With this, everyone knows exactly what is expected of them at each level, and more importantly, what skills they need to master in order to be promoted to the next level,” she said.
Invest in training
However, Abakar Saidov, co-founder and CEO of the talent management start-up Beamery, disagreed that keeping performance-based rankings was the best method for keeping productivity high.
“Of course employers should take an interest in the performance of their workforce, but rather than keeping a list of those who are underperforming, they should be considering what methods to use to improve performance and help their workforce grow,” he said. “Now is the time for businesses to invest in training and development programs that speak to the individual needs of employees.”
A recent Beamery survey of 2,500 British workers found that more than a third of employees would be more likely to stay with their current employer if they had more opportunities for sideways moves, or were better supported with training and development.
“Offering employees pathways for progression improves engagement, motivation, and ultimately performance,” Saidov said.
Jill Cotton, career trends expert at Glassdoor, told Fortune that while it was crucial for employers to pick up on underperformance, the most important part of performance management was getting to the root cause of why an employee’s productivity had slumped.
“Leaders need to look for the key signs of underperformance amongst employees, which include a lack of enthusiasm for work, repeated mistakes even with support and direction, failing to show initiative in the role, struggling to meet goals, and not getting along with co-workers,” she said.
“Sheer laziness will rarely be the reason for a worker’s inability to fulfill the role. Instead, it could be that the employee feels burned out, isn’t being challenged, sees no clear career progression with the company, or is being forced to work in poor conditions or with limited resources.”
What to do if you’re underperforming
For those who suspect their boss isn’t happy with their performance, there are steps to be taken too.
Vandenberghe advised those in doubt to have an open conversation with their manager, noting that both employees and bosses had a responsibility to ask for and offer help.
“Ask them candidly what you need to do to move from ‘underperforming’ to ‘performing,’” she said. “You can’t follow a dark path without a light. But also look deeper. What are your strengths? Are they aligned to the requirements of this job? If not, it might be worth exploring other options.”
Meanwhile, Cotton said employers and employees should work together to come up with “a clear, individualized plan” to get productivity back on track, with clear goals being set for how to move forward into a better, more successful space.
