Performance Improvement Plans (PIPs) - A Complete Guide
There’s no doubt it’s a tricky situation. If an employee is underperforming it can be a difficult topic to broach without causing offence.
Yet it’s a conversation that needs to be had, especially if a lack of productivity is beginning to affect others.
It’s important to find the balance between giving an employee a nudge in the right direction and supporting their growth and happiness in the workplace. This is made even trickier when the employee does not recognise the issue themselves.
In this situation, the best approach is to implement an intelligent performance improvement plan that encourages an employee who is struggling to succeed. So, let's take a look at when an employee performance improvement should be implemented, and what it should look like.
What is a performance improvement plan?
Well, it’s fairly self-explanatory but to put it plainly, a performance improvement plan (PIP), or sometimes known as a performance review, is typically a formal document that outlines any existing performance issues, while also outlining goals to tackle the productivity issues.
You can compare a PIP to your old school report cards. If you remember these outlined your performance, successes, challenges and the goals you should be aiming for. This layout is exactly how you can expect a PIP to look like
The criteria for the ‘success’ of a performance improvement plan can be anything from completing extra training to more regular check-ins with a manager, depending on the situation and goals of the company and employee.
Why do some employees need a performance improvement plan?
PIPs are designed for employees who are operating at a deficit of some form. This doesn’t necessarily mean that they are not working hard enough. Quite the contrary. It could be that an employee has had insufficient training, or that there has been a pivot in your business model. That's why it's crucial to identify the root cause of any performance issues, before setting up a performance improvement plan.
There are many reasons you might deem it important for an employee to participate in a PIP, but the common thread is that, from a management perspective, you wish to see a change in their performance.
8 Tips to help create an effective performance improvement plan
If you are at a standstill with an employees attitude or work performance, and you’ve seen no improvement or attempt to improve, it’s time to start developing a performance improvement plan.
To ensure your performance improvement plans are effective and set your employees up for success, there are a few things to keep in mind.
- How can you prepare an employee for a PIP and get them to take action?
- What information should a PIP contain?
- What's the role of the manager in the process?
- What happens after a PIP is used?
Here are some ways to make sure your PIPs will help you reach your objectives.
1. Open up a dialogue with the employee first
Your first action step should be to sit down with the employee and explain the situation. The tone you take here is completely dependent on the discrepancy but generally, you want to present a PIP as a helpful tool for personal growth. Having a positive attitude throughout the entire process helps both parties. You want to approach PIPs as a chance to further your employee's career, not as punishments that could end it.
It’s helpful to guide the conversation about their behaviours in such a way that a performance plan seems like the natural solution. Approach the conversation by presenting the facts and letting them draw their own conclusion. As in:
‘Alex, it looks like you’re short of your sales targets again this week. How do you think you’re doing? We’ve had a chat about this before and not much has changed. How do you think we should deal with this moving forward?’
By turning the conversation around asking the employee’s input you’re turning a disciplinary matter into a self-improvement project. This will help the employee to treat their PIP as a tool that helps them to work towards personal objectives, rather than one’s set by their manager.
2. Find the root causes of the issues
Performance improvement plans are only effective if they are built with an understanding of what the employee needs to improve. This can be knowledge or training, but also motivation or support from their team.
A lack of productivity doesn't always come from laziness: it could well be that an employee doesn't know how to efficiently use certain software or tools, or that there are distractions in the workplace that keeps them from their work. As a company, recognise that there are different aspects that influence an employees' productivity and quality of work, sometimes they have little to do with the employee itself
Including these root causes in the plan is important to see if the proposed solution actually solves the issues, or is it just adding additional workload on to the employee’s existing work.
3. Set achievable goals
There’s no point initiating a Performance Plan if you create impossible targets. This is an unfair way of forcing people out of the door. It’s meant to be about pulling people up, not shutting them out. If you’re using a PIP for the right reasons, then you want the employee to succeed, so set objectives that reflect this.
First, decide the ultimate ‘goal’ of the plan. What will success for this team member look like? It doesn’t have to be a set OKR or anything numbers-based, it can be as simple as getting all their deadlines in on time, or making sure they're making a certain number of calls per week.
Once you've determined the outcome, work out how best to get there. Ideally, you want to set incremental targets that slowly build up an employee’s performance. Moving up in days, or weeks, towards a ‘north-star’ goal. Make it very clear what you expect of them during this period as a lack of clarity will simply cause stress and most likely impede their growth.
Time frame is important here too. Bear in mind that there should be a clearly defined start and finish date, otherwise you’re simply placing an employee into professional purgatory.
4. Provide guidance and positive reinforcement
There’s no doubt that at stages the employee might struggle, or feel a bit lost, so it’s important to keep the avenue of communication open throughout. In fact, one of the more common reasons employees fall behind in performance is a lack of understanding or confidence in what they’re supposed to be doing.
Throughout the set time period for the PIP, make sure your employee knows what is expected and feels comfortable with the tasks they’ve been set. At the very least, this will cement in your mind whether the employee is competent enough to do their job. Being on hand to help and offering encouragement will both keep the employee on track, and demonstrate that they have your support.
Again, there’s no use in devising a structured plan without providing information on how to go about completing it. You should see a PIP as a chance for both the company and the employee to grow together. Maintaining a positive attitude throughout the process will help the entire organisation to recognise the value of an employee performance improvement plan.
5. Provide the necessary resources, training and time
If you expect your employees to develop their skill set, it's only fair you give them the resources and time to do so. When setting up an Employee performance improvement plan, make sure that your employees have access to the things they need to achieve their goals, and not have to go looking for it themselves in their own time.
It could be additional training, but also simply more time to study a new skill. Keep in mind that if you'd expect them to improve with the time and resources they have (and already struggle with), chances are they'll get even more frustrated and head towards failure.
6. Check in regularly
An effective PIP is not just handed over once, with one end-date and goal in mind - and on paper. You'll want to revisit it from time to time and see if the employee is improving in the right ways, at the right pace. The goal of a PIP is to help employees to reach certain objectives, but it's just as important how they get there. Having them burnt-out or lacking in different aspects after ''completing'' a PIP won't get you anywhere.
So, in the plan, include moments and dates for check-ins. Make clear what you'll be expecting on these check-ins with the manager who is aware of the case and is committed to supporting the employee along the way. This will provide actual structure and direction and will help your employee to stay on track.
7. Review your PIP appropriately
Once the performance plan has been completed (or not), you should call a review meeting, where the manager and employee sit down to discuss its successes and failings. This shouldn’t just be a conversation about the performance of the individual but also the effectiveness of the plan itself. Did it function the way you had expected? If not, why? What could you do next time to improve your PIP protocol?
This is a chance for you to grow as much as the employee, so treat it as such and take a moment to be reflective.
Regarding the employee, you should review their performance holistically: did they improve to a standard you are happy with? Being too critical of certain aspects, while ignoring some of the bigger successes is a futile way to appraise an employee. Humans work in a rhythm of peaks and troughs, so try and judge their improvement cumulatively.
Having discussed the outcome with their supervisor, the next step is to sit down with the employee and talk things through with them. Be probing and ask questions in this session, how did they feel the PIP went? Did it help? What should be the next steps? After this, you should then communicate how the review went from a management standpoint. If they haven’t met the standards they were set, then it’s time to start discussing options such as further training, or perhaps even reassignment.
8. Reward success
A last nugget of advice is that success should be celebrated. Cheer on improvement and don’t dwell on the problems that have led to a performance review. If an employee has hit their targets, the PIP is done and dusted and it's time to look ahead. Often after a review, employees feel as if they are on a second probation and can come to view work as a hostile environment. So, a bit of reassurance that this is the start of a new chapter will never go amiss.
When is a performance improvement plan appropriate?
A performance review's main function is to provide a structured approach to improvement, for employees who aren’t achieving their full potential. While a performance improvement plan isn’t strictly a punishment by the same token, and it shouldn’t be implemented lightly.
For instance, before considering placing someone on a PIP, ask yourself: to what extent is this the employee's fault? Is it a failing on their part, or of extrinsic factors? Has their supervisor provided sufficient evidence that there is an issue, or have they conjured up impossible standards. This is an important question to ask as if the fault lies elsewhere, it should be dealt with by management.
To give an example, let’s say you have an employee who has a time management issue. To justify placing them on a performance improvement plan, this discrepancy has to be recurrent and has to impact their job.
Moreover, springing a PIP on an employee isn’t advised either. It should be the end result of an ongoing conversation. If you have tried to change an employee’s attitude through persuasion and there is still an issue, then it’s time to consider a Performance plan.
Is a performance improvement plan a step towards dismissal?
There is a huge misconception among employees that once on a PIP, they’re on a slippery slope towards dismissal. Now, while failure to comply with a PIP could result in a dismissal, the purpose of the scheme is not to lever employees out the door. That should always be your last resort. As such, it’s important to explain this to any employee that’s being put on a PIP because chances are, they’ll fear the worst.
Frequently Asked Questions about performance improvement plans
How do you write a good performance improvement plan?
A good performance improvement plan is meant to help your employees, not to punish them. It all starts with identifying the root causes of the issues. An effective PIP is set up together, with an employee and manager around a table, and is tailored to each individual employee. What helps in one situation, might not work for someone else. When writing a PIP, keep in mind that it can help your employee and organisation as a whole.
Make sure your PIP is realistic. Can you provide the resources the employee needs for the improvements to be made? Moreover, keep it relevant: it should focus on specific issues your employee has in his or her work. This will make it easier to tackle. For this, it can also be great to use examples to demonstrate what will be expected of the employee, and what behaviours should be a thing of the past.
What should an employee performance improvement plan include?
- A great plan always acknowledges the starting point and where to go. What areas need improvement? What is the cause of the existing problems?
- What is the expected standard? Meeting this goal at the end of the improvement can seem like a daunting task. So, set up smaller goals in between. These will also give more structure to the milestones you’ll set your employee.
- The steps you'll want your employee to take, with a timeline that includes check-ins with the assigned manager.
- What resources and support will be provided by the company.
What are the benefits of PIPs?
When a manager identifies an issue with an employee's performance, it can be difficult to find a structured way to bring it up - let alone solve it. A conversation pointing out the problems and expected results often doesn't cut it and leaves employees guessing about what steps to take next.
A performance improvement plan gives managers and employees an easy-to-follow document towards the expected standards, but also makes it easier to deal with the consequences of not meeting said standards.