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How a Performance Improvement Plan (PIP) Can Help You and Your Employees Succeed

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Performance improvement plans (PIPs) are usually dreaded by managers because it is a conversation that is awkward for all parties involved. The employee is likely to feel embarrassed, anxious, and hurt, while the manager is stuck delivering hard truths to them. As uncomfortable as these conversations may be, they are sometimes necessary and can not only help the employee succeed, but it will positively affect the company in the long run. In this blog, we will discuss what a performance improvement plan is, how to establish a PIP, and some tips on how to create an effective PIP.

What is a Performance Improvement Plan?

Performance improvement plans are also known as performance action plans or PIPs. They are a tool used by HR and managers to give employees that are not performing well the opportunity to succeed. Unfortunately, PIPs usually get a bad rap, and to some, being put on a PIP is the same as being fired.

A PIP is a formal document stating any recurring performance issues along with goals set by the manager that the employee needs to achieve to regain good standing within the company. Usually, there is a specific timeline or deadline the employee needs to adhere to, but this can sometimes be altered depending on the situation. PIPs are not necessarily a bad thing. For example, if an employee has been struggling to meet their goals, a PIP can be a guide to help that employee meet those goals since it addresses the exact areas that the employee lacks to perform well. In most cases though, if an employee fails to complete their PIP, they usually end up losing their job. 

How to Establish a PIP

It is common for the HR department to facilitate the PIP, and for the employee’s manager to actually implement it. There are some steps that should be taken when establishing a PIP:

  1. Determine whether a PIP is needed

    Before even starting to draft a PIP, make sure to collect all the facts of the situation to help you determine whether a PIP is necessary. A PIP should be used for an employee that both the manager and HR believe can improve their performance if put on a PIP. In some cases, a simple conversation with the employee can help them better their performance.

  2. Develop and document the PIP

    Once the manager and the HR department have determined that a PIP is needed, it is time to create the plan. This is the part where you want to outline which areas the employee should focus on improving and set specific and realistic goals/deadlines for the employee to hit. Both the manager and HR department should agree and be on the same page for all parts of the PIP. They should even meet before addressing the plan with the employee.

  3. Set clear expectations for the employee

    Now that the manager and HR department have met and are on the same page regarding the PIP, it is time to meet with the employee and review the performance improvement plan. The goal of this meeting should be to address the performance issues with the employee while letting them know you value them and want to help them succeed within the company. Use this time to strengthen the relationship with that employee. They should walk out of that meeting feeling confident that they are valued and appreciated by their employers. Make sure to sign all the documents and answer any questions they may have.

  4. Monitor the plan's progression

    The manager or supervisor’s job is to closely monitor that employee. Make sure to be available to help them out whenever needed, and to check in regularly so they see they have support.

  5. Complete and evaluate the plan's success

    Once the PIP has ended, it is time to evaluate its success. Did the employee meet the goals you had outlined? Does the employee feel better about their performance? Have you seen an increase in their performance? After evaluating this, the manager can meet with HR to determine whether or not the PIP was successful. Then, you can decide how you want to move forward and discuss that decision with the employee.

Tips to Creating an Effective PIP

Whether you are a manager or an HR professional, you will need to deal with performance improvement plans at some point in your career. Navigating these situations can be tough, but these tips can help you create an effective PIP:

  • Identify specific areas that need improvement.

  • Provide specific examples of each type of behavior or poor performance.

  • Identify the reasons behind this underperformance.

  • Allow the employee to express his or her understanding of the issue and of the performance expectations.

  • Create a written document with specific, measurable goals for the employee to meet on a clear timeline.

  • Include any consequences that may happen if the employee fails to achieve particular goals and/or deadlines.

  • Set up a time to meet with the employee or manager to review the employee’s progress along the way.

  • Use performance management software to track performance, manage goal progress, and gather critical feedback.

Performance management software can help you better understand your employees’ performance and productivity. It allows leadership to easily track, analyze, and evaluate their staff and ensure goals are met and any issues are addressed in a timely manner. Dominion’s Performance Reviews can help you do just that! Request a free demo below to learn how to automate reviews, set up goals and scoring, and track employee performance all in an easy-to-use platform.


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