The Hidden Cost of Holding Onto Average Performers

There’s a small accounting firm I know. Solid business, great clients, strong leadership. But there was one employee - let’s call her Melissa. She wasn’t terrible. She wasn’t great. She was just . . . fine.

She did the work, but only when pushed. Deadlines slipped. Emails went unanswered. Her peers quietly picked up the slack. No one complained loudly, but over time, the team’s energy dropped. The best people started to check out.

The leaders knew. But they told themselves, “Replacing her will take time. Recruiting is expensive. Training is a headache.” So they let it slide.

Six months later, their star account manager quit. He was tired of carrying the extra weight. The whole office felt the loss. The cost of holding onto “fine” turned into a very expensive mistake.

Here’s the truth - Average is contagious. One person coasting signals to everyone else that coasting is allowed. And once your best people see that mediocrity is tolerated, they’ll either lower their standards - or leave.

Leaders avoid addressing it because it feels uncomfortable. Because letting someone go feels harsh. Because we confuse being decisive with being unkind. But leadership isn’t about avoiding discomfort. It’s about protecting the culture, the team, and the results.

Action steps to break the cycle:

  1. Identify the drag. Who is quietly draining time, energy, or morale?

  2. Have the conversation. Clear expectations. Clear timelines. Clear accountability. No vague warnings.

  3. Decide quickly. Either they step up, or you help them step out. Lingering indecision hurts more than a tough call.

  4. Protect your high performers. Make sure they know you see the imbalance and you’re acting on it.

You don’t pay for an average performer with their salary - you pay for them with your best people’s engagement, energy, and eventually their loyalty.

The cost of keeping “fine” is far higher than the cost of replacing them.