1) Showing confidence in the employee's ability and willingness to solve the problem. Ask him or her for help in solving the problem or improving performance. Ask the employee to join with you with the goal of increasing the employees' effectiveness as a contributor within your organization.
2) Describe the performance problem to the employee. Focus on the problem or behavior that needs improvement, not on the person. Use descriptions of the behavior with examples so that you and the employee share meaning. Ask for the employee's view of the situation.
3) Determine whether issues exist that limit the employee's ability to perform the task or accomplish the objectives. Four common barriers are time, training, tools, and temperament. Determine how to remove these barriers. Determine whether the employee needs your help to remove the barriers- a key role of a manager-or if he is able to tackle them by himself.
4) Discuss potential solutions to the problem or improvement actions to take. Ask the employee for ideas on how to correct the problem, or prevent it from happening again. With a high performing employee, talk about continuous improvement.
5) Agree on a written action plan that lists what the employee, the manager, and possibly, the HR professional, will do to correct the problem or improve the situation. Identify the core goals that the employee must meet to achieve the appropriate level of performance that the organization needs.
6) Set a date and time for follow-up. Determine if a critical feedback path is needed, so the manager knows how the employee is progressing. Offer positive encouragement. Express confidence in the employee's ability to improve.
Here is The Balance article where i got the steps from.
I would also like to add appreciation is a big part of coaching as well. Employee's enjoy being recognized for their hard work. It keeps them motivated to keep up the great work.
Here is a video of a great way to coach poor performance.
I like it...good creativity.
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