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What is Performance Improvement Plan?

Performance improvement is measuring the output of a particular business process or procedure, then modifying the process or procedure to increase the output, increase efficiency, or increase the effectiveness of the process or procedure.

performance improvement plan is a formal document stating any recurring performance issues along with goals that an employee needs to achieve in order to regain good standing at the company (usually with a specific timeline to complete the plan). If you’re being put on a PIP, your manager and HR will most likely meet with you to go over it and answer any questions you may have.

In layman’s terms, it’s like being put on probation when you’re in school—you’re going to be watched closely during this period. If you aren’t successful in completing your PIP at the end of the timeline, losing your job is usually the end result.

If you’ve been struggling to meet your goals, a PIP is meant to give you concrete ways to turn your performance around. For most, simply knowing exactly what they can do to improve is enough to make their way out of a slump (meaning it’s definitely possible to succeed on one!).

Things to be kept in mind before starting a PIP are as follows :

It should never be a surprise

Any low performance should have been discussed in a previous one-on-one meeting already. Your direct report should not be caught off guard that you’re suggesting a performance plan to them. In larger companies, this is also something that should have surfaced in feedback to HR (be it ad hoc or via your monthly feedback cycle, depending on what your cadence is.)

Let the employee know a PIP is a possibility.

Knowing that a PIP might be on the horizon can be a powerful motivator for some. However, given this, be conscious to not frame the possibility as an ultimatum. Instilling fear is not productive in the long-run. Rather, be transparent as possible about the person’s level of performance is and what the potential next steps might be. For instance, during a one-on-one meeting, you could say, “We need your performance to be at [X tangible level], and I want to work with you to improve. I don’t think we’re at the point where we both need a performance improvement plan in place yet. But, I do want to share that could be a potential next step down the line if we don’t improve, together. Right now, I do want to support you to figure out how to make things better. Would you be open to discussing that?”

Consider having others in addition to the employee present for the conversation

It is recommended that the meeting about the PIP involve the employee, the manager, and HR. This is to make sure all relevant parties are on the same page. If you do choose to involve HR, be wary that some find it distracting (if not a bit ominous) to have HR in the room when the PIP is being discussed. At the same time, others prefer to have HR present from the beginning because it helps establish continuity of information.

Have an overall consistent flow for the PIP

The PIP should always be in a proper flow like starting from meeting the employee to discuss the performance improvement plan, clearly defining expectations, developing a plan during the meeting, setting up 4-6 checkpoints, and finally declaring success or failure. 

Draft the plan always with the employee’s input.

An effective performance improvement plan is “we can improve together” and not just “I’m telling you what to change.” Every step of the way, from having the initial discussion about poor performance to defining the weekly checkpoints, you should be co-creating the PIP, and working together to figure out how to get to the outcome you both want to achieve.

Understand the cultural implications of a PIP

For some people, PIPs work incredibly well for their team because their team thrives on having clear processes and structures in place. However, 80% – 90% of employees who were put on a PIP left the company during the PIP period, it culturally made the PIP “a herald of doom.”

Regardless of whether you decide to move forward with a formal performance improvement plan or something more informal – the important piece is that you’re purely focused on helping your employee improve. That’s your purpose as a manager, after all: To create an environment for your team to do their best work. It doesn’t matter if you call it by a three-letter acronym (“PIP”) or not. The outcomes are what matter.


Author / Educator – Isha Gaur, Lead – Talent Engagement Partner

Isha is HR Professional with 6+ years of experience currently working with 3Pillar Global and has prior experience in organisations like Thomson Reuters and hCentive Technologies. She started her corporate journey with the Recruitment function of HR, then moved to HR Operations, and then finally working as an HR Business Partner role for the past 4 years. She has a good hold on HR processes like Performance Management, Employee Engagement, etc.


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