Tips to Increase the Effectiveness of Performance Improvement Plans

How to deliver an effective performance improvement plan (PIP)

How to deliver an effective performance improvement plan (PIP)

No matter how amazing your performance management HR systems are, there will come a time when one of your line managers needs to devise a performance improvement plan.

This is a tactic that aims to address persistent shortfalls in an individual’s performance, outline solutions and specify the steps required to bring that performance back in line with the expectations of their employer and the requirements or their role.

A performance improvement plan (PIP) often follows a series of poor performance reviews, poor employee engagement, or persistent performance issues. Although it’s an alternative to dismissal, the traditional view is that a PIP means the employee in question is already well on the way to the exit.

Let’s not kid ourselves, that intuition is correct in many cases. By the very nature of the exercise, many recipients of a PIP will leave. It happens, but not always. Not if the PIP works. 

Why use a performance improvement plan? 

Showing someone the door – while sometimes necessary - does nothing for a performance culture of improvement and accountability, while taking explicit steps to support individuals taking responsibility to improve their own performance absolutely does.

And with the cost or recruitment constantly increasing, and talent in shorter supply than ever, it makes sound business sense to do everything possible to protect the onboarding investment you’ve already made in this person.

Plus, it’s fair to give them every possible chance to avoid dismissal.

This is clearly a sensitive issue, so managers will naturally look to Human Resources for HR processes to help them create their PIP, set objectives, and document and manage the process using HR software.

So what is a performance improvement plan?

A PIP should be created by the employee’s line manager, with support from HR, and what it contains will vary massively depending on the specific performance issues involved. It should clearly articulate the areas where the employee is underachieving. It should set realistic goals. And it should provide practical steps they need to take to achieve the required improvement.

This might include any skills deficits, identifying training or development that the individual needs to complete.

It could be that the employee’s behaviour needs to improve. It falls short in some way of the employer’s performance expectations, in which case, specific examples must be provided alongside examples of the required improvements.

Regardless of the specific issues addressed in the performance improvement plan, the critical thing is that the PIP is clear about the action that must be taken to improve.

When should a performance improvement plan be used?

Executing a PIP is a lot of work for a manager, so it’s not an element of performance management or employee engagement strategy to be entered into lightly. HR should recommend that PIP be used only when a performance improvement is needed.

Most often, PIPs are used when an employee is struggling, and while the connotations are almost exclusively negative, the actual purpose of a performance improvement plan is for an employee and their manager to collaborate on making things improve.

Performance improvement plans can be applied to those whose progress has stalled for some reason. Perhaps an individual has become disengaged with their role. Employee data suggests their productivity has slipped. They’re in a rut.

Fundamentally, a performance improvement plan is an HR process that facilitates a frank and open conversation about what needs to change. A way for an employer to demonstrate their commitment to helping an individual get back on track.

How to create an effective performance improvement plan (PIP)

Communicate:

If a PIP lands in an employee’s inbox out of the blue, the result will likely be the opposite of what is intended. A PIP should be the culmination of numerous performance discussions. If you maintain performance management data can be addressed in one-to-one performance reviews, where the possibility of a performance improvement plan has already been mooted. Shock and fear are not motivators. Do not make it a surprise.

An effort should be made to identify any root causes for the issues in question. If productivity has fallen off a cliff, it’s a responsibility of an employer who is concerned with the wellbeing of its people to investigate why. Since Covid-19, wellbeing issues have become critical factors in performance improvement and employee management.

The root cause may turn out to be a change in workplace technology, line management, new colleagues, additional workload, or an upheaval in their personal life. Encourage line managers to be open minded and supportive.

Be consistent:

HR should create an agreed PIP process for your managers to follow, ensuring performance management consistency cross the organisation.

  • Open discussions:

Book a meeting to discuss implementation of the PIP. Make the reason for this meeting explicit, both to ensure there are no surprises, and to give the employee time to prepare.

Sometimes it’s a good idea to invite a third party to attend. A human resources representative, for instance.

  • Agree objectives and expectations:

This is a collaboration, so manager and employee need to agree on the plan objectives, ensuring that these are achievable.

  • Clarify the steps to improvement:

Be explicit about how the employee’s daily and weekly activities need to improve to meet the agreed goals. How will performance on these be measured?

  • Define the manager and employer’s role

The objective of this plan is to enable the individual to improve, but its unfair to expect a struggling employee to achieve this alone. What is the specific support that the manager will commit to this process to help the employee achieve their goals?

  • How long should a PIP take?

A typical PIP will run for one, two or three months. Enough time for the individual to demonstrate the improvement required. If employee data is inconclusive, the PIP can be extended, though it’s better to have a clearly defined end date, and the plan should not run for longer than three months.

  • Plan the checkpoints

During this time, they will need closer management than usual. Weekly, even daily check ins should ensure they receive regular feedback on how they are performing against the objectives set out in the PIP.

Should a PIP be used?

Human Resources and senior management should always keep in mind that poor performance is not automatically the fault of the employee.

It’s important to establish where the fault rests. Has all the necessary support been given to this individual? Was onboarding effectively delivered? (See our remote onboarding checklist) Appropriate systems training completed? Is this a performance issue or a personality clash? Does your HR software and employee data support the manager’s conclusion that the problem is sufficient to warrant a PIP?

There’s obviously a problem involving this employee, but is it their fault? If not, the issue needs to addressed separately by HR and management.

HR Software's role in PIP

Modern, cloud-based HR software like XCD incorporates a suite of performance management and self-service tools that enable seamless management of disciplinary, performance and grievance processes in a secure, (GDPR compliant) HR platform.

Your HR software should provide a performance management solution where the PIP process can be viewed, managed, updated and tracked, using self-service, by both parties.

HR Software: XCD is a cloud-based HRMS suite of tools that enables performance and employee management throughout the entire end-to-end employee lifecycle.

Find out more about XCD's HR software performance management module.

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