How to write an effective performance improvement plan

By Indeed Editorial Team

Updated 13 October 2022

Published 29 September 2021

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

Helping employees to improve their performance at work and grow within their roles is one of the most important parts of management. When there are problems with an employee's performance, it's important to approach the issue in a positive and constructive way so that you can find a solution together. One of the ways you can do this is with a performance improvement plan (PIP). In this article, we discuss when a performance improvement plan is appropriate and when it's not, answer some PIP FAQs and explain how to effectively use one to help employees succeed.

What is a performance improvement plan?

A performance improvement plan (PIP), sometimes called a personal improvement plan or employee improvement plan is a formal business document that sets out problems with an employee's performance and the steps that can be taken to correct them. When used right, they can be an effective tool for solving problems with a team member's work, which may not always be their fault.

Related: How to boost employee morale in 6 steps (plus tips)

When is a PIP appropriate?

A performance improvement plan can be used in any situation when a manager feels that a member of their team is not effectively carrying out their duties. When an employee has a short-term record of diminished work quality, a PIP can be an effective tool to uncover and address the root issues, provide feedback and help the employee get back on track. Before resorting to a PIP, it's important to consider:

  • Whether the issues are long-term, in which case a PIP may not work

  • Whether the issues are due to inefficient management or lack of resources, which could be addressed in different ways

  • Whether personal issues could be affecting their work

Related: What is work ethic and why is it important?

What is included in a performance improvement plan?

A PIP typically includes the following elements:

  • The names and job titles of you and the employee. Any other involved parties, such as the employee's supervisor or an HR representative, also need to be mentioned.

  • The start and end dates of the PIP. Include the date you created the performance improvement plan, the date you plan to meet with the employee at the end, and any interim dates by which certain goals must be met.

  • A summary of the concerns. If possible, include concrete examples that show why the PIP is necessary.

  • The goals for improvement. Having a list of goals they need to achieve by a set date gives the employee something to work towards.

  • Details of resources that you can provide. Many PIPs include a list of resources that management plan to provide to help the employees reach their goals.

  • Your expectations and what happens if they are not met. The employee needs to clearly understand what is expected of them and what the next stage is if they don't meet these goals.

Related: How to measure employee performance in 6 easy steps

How to effectively use a PIP

A performance improvement plan is not meant to be used as a reprimand but as a collaborative tool whose aim is to support the employee and help them to improve their performance. To effectively use a PIP, follow these steps:

1. Begin with a conversation

Performance improvement works best when it's seen as the logical next step in a process and isn't sprung on an employee unexpectedly. As soon as you become aware of problems with an employee's performance, begin an open dialogue with them to find out what is causing the problems and how you can support them to overcome them. A PIP is appropriate after other options, like providing extra resources, have been explored.

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2. Look for the root cause of the problem

It's possible that the problems with an employee's performance are not their fault. They could be due to changes in management, a lack of resources or simply a poor understanding of the role they are supposed to be fulfilling. Many employee issues are also down to personal problems affecting their work. Although none of the above reasons necessarily mean that a performance improvement plan is a bad idea, it's important to understand what is causing the problems so that you can effectively resolve them.

3. Set achievable goals

A PIP needs to tell an employee exactly what is expected of them. Ensure that the goals you set are realistic, as employees who feel they are aiming for something impossible are more likely to become disheartened. Be clear and specific about the employee's overall goal and the date this needs to be achieved. It's also a good idea to break this down into smaller, incremental targets which need to be hit by certain dates along the way. This way, your employee won't be overwhelmed, and you have something concrete to measure their progress against.

Related: How to develop SMART Goals (with examples)

4. Provide resources, training and time

Problems with performance are often linked to inadequate training or resources or a lack of understanding of what a role entails. Ask your employee what resources would help them to achieve the goals you set out in their performance improvement plan. Remember that while these may be concrete resources such as software or training sessions, they may also be as simple as providing them with the time to learn or perfect a new skill.

Related: How to create an employee development plan (with definition)

5. Check in regularly, provide guidance and give positive reinforcement

It's important to provide regular feedback and support for your employee as they work towards the goals in their performance improvement plan. It's a good idea to organise regular meetings to assess progress together and make sure the employee knows what is expected of them. Offering praise when small goals are hit is also important, as it shows the employee that they have your support and that you want them to succeed.

Related: Positive feedback: why it's important and how to give it

6. Review the PIP appropriately

After the end date of the plan, schedule meetings with both the employee and their supervisor. Talk to their supervisor first to discuss what improvements have been made and what could still be better. Then discuss this with the employee. While the purpose of this review is mostly to determine whether the employee has met the expectations laid out for them, you can also see it as an opportunity to review your own process and what you could do differently to better support other employees in the future.

Employee improvement plan FAQs

Here are the answers to some common questions about employee improvement plans:

What are the benefits of a performance improvement plan?

A PIP provides a structured way to address and solve problems in the workplace without resorting to disciplinary action or even termination. Employees must understand that the purpose of a performance improvement plan is to help them achieve their goals and improve their work and not simply a path towards being disciplined.

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When is a PIP not appropriate?

Although there are many situations in which performance improvement plans are a useful tool for improving employee performance, there are some instances in which they may not be useful. For example:

  • When issues with a team member's performance are due to unreasonable expectations being put on them, perhaps by a new manager or supervisor.

  • When the issues are longstanding over several years, in this case, a better solution might be to use annual performance reviews, feedback, support and training goals.

  • When there's evidence that it won't be effective, for example, when PIPs have been tried with this employee before.

  • When there has been gross misconduct, such as theft or fraud.

Related: What is an issue log? How to track problems step-by-step

What if performance decreases after the period outlined in the PIP?

If you have followed the steps above and used the PIP as a tool to help your employee to grow rather than as a punishment, you're likely to see real and lasting improvement in their performance. However, some managers also choose to use a two-stage PIP model, in which a second stage, after the initial end date, consists of further monitoring of progress but with fewer meetings and incremental goals. This helps to continue engaging with the employee after the initial performance improvement plan process.

What is the difference between a performance improvement plan and a written reprimand or warning?

Employees may receive a written reprimand for poor performance, which is an official document that's put into their file. Although there may be some overlap between the contents of a written notice and a performance improvement plan, the former provides no steps for improvement and is simply a disciplinary action. The goal of a performance improvement plan is to help an employee overcome their issues, not to reprimand them.

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