5 Main Ways Underperforming Employees Affect Your Business

If you ask a business owner what they look for in an employee, many times, their answer will be “someone who goes above and beyond expectations.” You’ll never hear a business owner say they’re looking for an employee who underperforms. However, at some point, every entrepreneur, business owner and manager has to address an underperforming employee.

With everything you have to take care of in your business, it’s tempting to let the employee slide. Especially, if their work does not interfere with your business. However, the reality is that employee performance does some major damage to your business in the long run.

Disengaged employees will hurt every aspect of your business operations. You must be vigilant and do your part to keep your team engaged, even though some employees may still be fall through the cracks. In this article, we’ll look at 5 key ways that underperforming employees affect your business.

5 Ways Underperforming Employees Will Affect Your Business:

  • Decreased productivity
  • Loss of sales opportunities
  • Hit customer satisfaction
  • Can reduce team morale
  • Damage to your brand

1. Decrease in productivity

In a prosperous business environment, productive workers will produce the output needed by their company. Most settings want employees to strive to achieve above and beyond what is required of them. It shows that the employee is engaged in the interest of the business. Low performing employees are individuals who are not meeting the specified output required. These workers will submit work incomplete or late. Also, they usually do not depend on completing a specific capacity of work. Low productivity is one of the major obstacles when dealing with business problems.

Employees who cannot pull their weight affect the morale of the entire team. Not only that, they also destroy the company’s growth. If work is left unfinished or deadlines are missed, the company will suffer and financial growth will suffer. On a larger scale, the decline in per capita productivity also affects the country’s GDP and economic growth. If you experience low productivity, it will start a chain reaction of many other failures.

2. Loss of sales opportunities

When employees are not engaged, they tend to do minimal work. This means that they don’t look for new sales opportunities, or go above and beyond when dealing with customers. This indifferent approach to business will undoubtedly cost your company sales.

As an employer it is vital to help foster this positive attitude and ensure the rewards for seeking and obtaining sales. When it’s all said and done, employees who underperform and sit in the background will lose your business revenue.

Weak employees are the kings of not taking advantage of opportunities. Conversely, your successful employees will learn and look for opportunities to sell. Their positive outlook at work will translate into earning money.

3. Customer satisfaction hurts

The customer is always right, a phrase that has haunted us for decades. Haunting or not, it’s true. Customer loyalty and satisfaction is the core of a brand. Frustrated employees will hurt business productivity and in turn lose customers. This can expose customers to late or low quality deliverables. All business operations ultimately affect the customer.

And on the other hand, an underperforming employee who is not invested in the growth of the company may refuse to go the extra mile for a client. This will dramatically affect the customer’s view of the business. If you notice that your customer satisfaction rate is low, one option is to conduct surveys or tests with your employees to determine how they handle customer situations. One can also use video or audio recordings to monitor the quality of customer interactions.

4. Low team morale

As mentioned above, lack of productivity can also affect a team’s morale. When one team member isn’t pulling their weight, other team members have to do their share of the work. While this may be required for absences, vacations, or other circumstances, it should not be the norm. Your team members who are doing their jobs well may become frustrated with more work than they can handle. They may also increase your resentment for not taking appropriate steps to correct the situation.

Another way an underperforming employee can reduce morale is through negative attitudes. Employees who do not share a vision with their employer and seem dissatisfied will spread this energy onto their colleagues. It’s terrible if just one employee underperforms, let alone the entire team.

If the lax culture is not reprimanded, the results will reflect it. Instead, it’s wise to create strict deadlines and enforce them. Having a realistic yet unique standard is an excellent way to keep employees engaged and striving to reach goals. You want your employees to feel excited about the company’s journey. Don’t procrastinate and probably finish their papers by 5.

5. Damage to your brand

A brand image takes years to build and can be destroyed in days. It is a business’ most valuable asset, yet equally fragile. It is in your best interest to protect that image. Customers need interactions with your brand to be positive and satisfying to build trust. For example, in 2005, Chipotle gained fame with their Mexican-American-style fast-service build-your-own food. Their brand took a serious hit in 2015 when several restaurants experienced E-coli and norovirus outbreaks. Some headlines changed the image of Chipotle forever. Many factors contribute to Chipotle’s problems; Can unemployed workers be one of them?

Chipotle believes the meat they received was contaminated and said the food was Improperly handled by employees, spreading more contagion. If employees deal with meat according to protocol and use proper sanitizing guidelines, very few people can get sick. Further proof that underperforming employees will affect every aspect of the business, especially the livelihood of your brand.

What to do when an employee underperforms

Underperforming employees is a problem that all leaders need to take seriously. So, what can be done Helping low performing employees? First, it is important to remember that every employee has the potential to improve. Their improvement will inevitably contribute to the company’s success. It’s important to take action as soon as possible so you can keep your business strong.

Then you want to meet with the employee to discuss their performance. Present to them what you observe. But, you want to be open to hearing their feedback. Their underperformance may be due to something that has little to do with work. Be sensitive to what they are going through to help them feel heard.

From there, you may want to create a plan of action. This may include:

  • Identify specific areas of performance that require improvement.
  • Develop specific, measurable and achievable goals for the employee to work towards.
  • Set up regular check-ins and follow-ups.

During this process, do what you can Motivate your underperforming employees. This will ensure that they can continue to improve without losing momentum. To learn more about some techniques that will help, check out our article What to do when an employee underperforms.


There are many ways to manage employees who are struggling with their work. In the case of Chipotle, not only the employees can be blamed, but the management also needs to be held accountable. Management must take notice and hold their employees to a certain standard. Employees who do not meet your criteria must be re-evaluated, trained or reprimanded to improve job performance. In the worst case scenario, it may be time to let them go.

Alicia Ronto is on LinkedIn
Alicia Ronto

Team Writer: Alicia Ronto, a 30-year-old self-employed security coordinator and part-time freelance writer. In October 2022, he graduated with his bachelor’s degree in business administration. Alicia is also the mother of a 3-year-old daughter and spends extra time cleaning, reading, going to the gym or going on short weekend trips. Her goal is to freelancing full time one day.

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Article Tags:

Featured · Find Your Way · Grow Your Business · Leadership · Productivity · Sales · Success · Your Mindset

Article Category:

Find Your Way · Grow Your Business · Lead Your Team · Productivity · Sales · Your Mindset

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