How to Create a Performance Improvement Plan

By Betterworks
November 19, 2021
5 minute read

HR leaders shape and solidify a performance review process that allows managers and contributors to assess performance candidly. But what happens when an employee’s performance is called into question? Or when an employee reaches out for help and guidance in terms of reaching their goals? That’s when it’s time to create a performance improvement plan.

Many employees perceive performance improvement plans (PIPs) as death knells to their employment. But that isn’t always — or even typically — true: Performance improvement plans aren’t implemented on lost causes. They’re a strategic investment in employees who need additional guidance to get back on track.

What does it take to create a performance improvement plan that actually improves performance?

While no two employee performance improvement plans look the same, there are best practices to consider when creating one. Performance improvement plans must be thoughtful, intentional, provide clear direction and align all parties’ expectations.

Here’s how to create a performance improvement that drives meaningful results.

What Is a Performance Improvement Plan?

Calibrating how the individuals on your team or at your company perform is nearly impossible without a uniform, well-communicated, and thoughtful plan. An important part of that plan is laying out specific steps and measuring improvement when employees are underperforming.

Performance improvement plans are action-based guides designed to explicitly outline steps an employee needs to take to meet their goals, improve behaviors and make necessary changes. These plans are typically bespoke, written, and collaborated on by an HR leader, a manager, and the employee in question. 

To make the plan easier to monitor, incorporate it into your performance management system. This allows managers to transparently track and share progress with both the employee and HR. There shouldn’t be any mystery around how an employee is tracking against their performance improvement plan. 

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When Should You Implement a Performance Improvement Plan?

Performance improvement plans have the greatest impact on employees who consistently underperform, but it’s essential to define what that means on the front end. Employees whose work is of lower quality than expected or who struggle to deliver their outputs on time are prime candidates for a performance improvement plan.

Employees who consistently harass or belittle their colleagues are not good candidates for a performance improvement plan. Those behaviors have a much greater impact on their colleagues’ performance than on their own performance and shouldn’t be tolerated in the workplace.

An additional consideration when deciding when to implement a performance improvement plan is employee rights. Historically, some companies have misused performance improvement plans to manipulate employees into signing the PIP as a precursor to their termination.

Beyond being a waste of time and resources, such actions can create additional liabilities for the company. Courts recently ruled that issuing a performance improvement plan, on its own, doesn’t constitute adverse employment action — but misusing a PIP can. A PIP that doesn’t outline clear criteria for improvement, for example, or focuses on a personal trait instead of a valid performance concern can potentially lead to legal claims of adverse action.

Always consult local counsel for legal advice when drawing up formal documents of this nature.

How Do You Write a Good Performance Improvement Plan?

There are three crucial steps to developing any performance improvement plan.

Set Clear Goals

Clarity is key: One of the primary causes of poor performance in the first place is usually a lack of direction. A performance improvement plan should put employees on the path to better performance through a better understanding of the expectations of their role.

Prioritize Communication

Regular check-ins are essential. Schedule time on both your calendar and your employees. Ongoing communication with their supervisor is an important resource for employees in a PIP. Regular check-ins enable managers to oversee the program and coach employees along the way.

Create a Solid Structure

Set employee expectations of their performance improvement plan before beginning the program. Managers, employees, and HR representatives must all be aligned going into the process to produce the best outcomes. Develop a clear structure with plain metrics that allows managers to track progress at a glance.

What Should a Performance Improvement Plan Include?

Performance improvement plans require a specific time frame, whether 30, 60, or 90 days, until the end of a quarter, or whatever makes sense for the situation. The PIP framework should also include the following:

  • Area(s) of concern: Where performance has failed or consistently underwhelmed.
    • Example: An employee in a call center consistently fails to meet the company’s customer service standards.
  • Goal (or expected outcomes): A brief sentence or list of what should be achieved by the employee.
    • Example: To improve customer service conversations.
  • Actions: A statement that explains the direct steps the individual will take to achieve the stated goal.
    • Example: Shadow the top-performing customer service rep; review the customer service scripts; take over an escalated call from a peer.
  • Metrics: Key results clearly laying out how the individual will be measured by HR and their manager to determine whether the goal was met.
    • Example: The accumulated customer satisfaction scores over the set period.
  • Scheduled checkpoints: A concrete timeline with expected actions to be completed before each checkpoint to keep the employee’s progress on track.
    • Example: The employee must complete 10 hours shadowing top-performing reps by the end of the first two weeks.

An effective performance improvement plan must be specific and lay out clear goals for correcting poor work performance. An employee put on a PIP has to have a clear direction. This might require breaking larger objectives down into smaller actions, or key results, that demonstrate the employee has achieved their goals.

How to Complete the Performance Improvement Plan (Example Check-In Form)

As a leader, identifying and helping individual contributors meet their goals and continue to grow within an organization is difficult enough. Preparing managers for employee improvement plan meetings by creating a check-in form will help managers keep meetings on track. Asking thoughtful questions throughout the process builds trust and supports a culture of continuous feedback, alignment, and transparency.

Here are some of the core questions to include in a sample performance improvement plan check-in form. 

  • What progress has the employee made toward their PIP goals?
  • What has stood out about their performance? 
  • What has the employee learned about the work or themselves along the way?

Posing these questions throughout the process creates a more enriching performance improvement plan experience. Providing the resources managers need for in-depth performance management helps you balance recognition and impact as an HR leader.

Executing an Employee Performance Improvement Plan

As with all performance-related conversations, clarity, thoughtfulness, and specificity should be top of mind. A manager should never present a performance improvement plan to the employee unexpectedly. Springing a plan on an unwitting employee can lead to confusion, defensiveness, and misalignment.

Bring together the employee, manager, and even HR representation to discuss performance issues before considering a plan. The employee will have the chance to provide their valuable point of view, ask questions and leave feeling engaged and committed to reaching their new goals.

Alternatively, an open conversation between all parties could discover an underlying issue or reason the employee’s performance has declined. Perhaps they are having personal issues or have been considering an entirely different role or career path. Either way, an initial meeting to establish understanding is vital to executing an employee performance improvement plan.

The next piece to consider is supporting. As this individual now faces their current workload along with a new plan of action, it’s shortsighted to think they can go it alone. Identify yourself or your team members as support options for your employee. Participate in regular check-ins to speak candidly about what’s working and what isn’t.

Finally, make sure to agree upon what happens at the end of the performance improvement plan period. If the employee feels they will be fired no matter what, no improvement plan will work, regardless of how it is thought-out or executed. Make sure you, the employee, and HR have all agreed on the best path forward, whether the employee reaches or doesn’t reach their explicit goals.

You can change the way performance improvement plans, and the performance management process in general, are perceived by your employees. They need to know that HR and their managers aren’t out to see them fail. Performance improvement plans are put in place to facilitate employee success and help them reach their full potential.

Some employees need a little more guidance than others, and that’s OK. Creating and implementing performance improvement plans in weak areas will keep your workforce on track to achieve business goals.

Click here to learn how to improve employee performance by using meaningful performance objectives!