Performance Management in a Tough Hiring Environment

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It’s no secret that business is tough right now. You’ve heard the news: companies are cutting back on spending, which means less hiring and likely stagnant or reduced budgets. Although this can be challenging for you as a manager, it doesn’t mean that managing performance is impossible. The same basic principles still apply, even if it is a bit scary to let someone go, knowing it will hard to replace them.  It just means you have to get creative and make sure your employees know what’s expected of them—and how they will be rewarded for meeting those expectations—even if you don’t have any open positions available for growth or promotion opportunities right now.

Avoiding letting a poor performer go, due to risk of getting replacements, will hurt the business down the line.

Give employees feedback on performance issues promptly and regularly.

Feedback is the key to performance management. When you give employees feedback on their performance, they need to know what it is that you want them to improve on and how they can do so. Feedback should always be given in person and should be specific about the problem at hand, while also focusing on what improvements can be made. When giving positive feedback, make sure to focus on behaviors or results rather than personality traits. Finally, follow up by setting a timeline for when you will meet again and discuss any further changes needed in order to continue improving your employee’s performance level.

Reward those who are performing well; do not ignore them.

To help those who are performing well, recognize the good work they are doing. You can do this in a number of ways:

  • Give them a raise or bonus. If you have the budget for it, you should consider rewarding your team members’ excellent performance with extra compensation.
  • Give them a promotion. You may also want to consider promoting some of your top performers so that they advance further into the organization and continue to grow as leaders within the company’s culture—and even potentially move on to become leaders outside of it!
  • Give them more responsibility. By adding new responsibilities to their current role, you allow these individuals an opportunity to learn new skills while continuing their upward trajectory toward greater influence at work and recognition by senior management (which is certainly something everyone wants).

Explain that things need to change or there is no other alternative but for them to leave.

  • Explain the situation. It’s important that you are honest with your employees, especially when they are likely to be upset. Be clear about why you feel they need to leave, and how this will affect them, including their reputation within the company and industry, their ability to find similar work elsewhere, and their reputation in general.
  • Explain options for leaving. Employees often feel like there is no alternative but for them to quit when a job ends abruptly without warning or preparation time; however this is not always true! Sometimes there is still time left on an employee’s contract (especially if it was only signed recently), which means that even if they aren’t happy with the decision made by your organization regarding tenure length/work schedule flexibility etc., there may still be other options available for them instead of leaving immediately without any warning whatsoever which could come across as unprofessional or mean-spirited towards fellow coworkers who had nothing at all do with making these decisions themselves even though everyone knows how hard those relationships were built over years together–not just months or weeks before being terminated suddenly without notice!
  • Discuss what will happen next step wise so everyone knows what’s going through mind moving forward so everyone feels safe moving forward towards next steps knowing where each person stands within company structure right now.

You can still manage performance even if you are unable to hire for open positions.


    • Don’t wait to deal with performance issues: You should not avoid dealing with performance issues. Be proactive and proactively address them as soon as possible.
    • Don’t be afraid to terminate an employee: It is important that you do not feel afraid about terminating an employee who is not performing well in any case, no matter what the situation is or what the circumstances may be at that time. If this person isn’t working out for your company, then it would be a good idea for him/her to leave on his own accord rather than waiting for things get worse before ending up getting fired later down the road due t o some serious issue(s).

You may not be able to hire for all of your open positions, but you can still manage performance. Employees are more likely to stay on board if they feel like they have a voice and that their opinions matter—even if they don’t get everything they want in return.