Tolerating Underperformance

Tolerating Underperformance

As the CEO or owner of a business, you know that people are your greatest assets. Thus, we expect the best and are disappointed and surprised when great results do not occur.


When a business is in its early stages, the CEO or owner is operating it as lean as possible and only adds staff when it is absolutely necessary. Sometimes, the new hire will be well skilled in a given area critical for growth. Other times, the individual will be more of a generalist, in having a number of skills which are necessary to cover all of the bases. Over time, as the business grows and becomes more complex, these needs may change. Different capabilities will be required to take the business to the next level. It may well be that the key individuals who have made major contributions and brought the business this far are capable of learning and acquiring the additional skills needed. Oftentimes, a business will not have leaders that are accomplished at hiring, training, coaching, and developing others. Many times the current and future business needs will exceed the capabilities of the loyal, dedicated team that has brought to the business to its present, successful level. This then poses a very difficult and emotional dilemma to the CEO or owner.


Having underperformers due to one of the above scenarios is not unusual. There are also those that start out well, but for whatever reason, are not performing at a high level. Irrespective of the cause, when a business accepts that having someone in the role is better than addressing the performance issue, the “Warm Body Syndrome” is present. The belief that a warm body is better than facing the process of potentially terminating someone or downgrading that person to a position in which they are capable of making a great contribution is dangerous to the long term health of the business and will limit both growth and probability. Additionally, other teammates see this and their productivity is adversely affected as they see a lack of accountability. As difficult as it may be for the CEO or owner to address, the value of the business will be enhanced by having the right team to build the future. Stars are required to have stellar performance.


Business Value Growth is dependent on the shift from primary reliance on past knowledge and aging practices, to a forward-facing perspective with a clear view of evolving business environment and best- practices aligned with conditions in today’s marketplace.