A testing team member who usually works well has performed poorly for the last two iterations, causing the team to miss iteration goals. How should the project manager handle this?

The project manager should first speak directly with the team member. This is a foundational principle of effective team management and conflict resolution. Addressing the issue directly and privately allows the project manager to understand the root cause of the performance decline, offer support, and collaboratively develop a plan for improvement. This approach respects the team member's autonomy and fosters trust. Allowing the team to raise the issue directly is inappropriate as it can lead to public shaming, damage team morale, and may not be effective in resolving the underlying problem. Discussing the problem with the functional manager or reporting to HR are escalations that should only occur if direct communication with the team member fails to resolve the issue, or if the problem is severe and impacts multiple team members or project success significantly. These options bypass the immediate opportunity for direct resolution and can be perceived as punitive rather than supportive.