Providing regular employee feedback and end-of-year performance reviews are critical to being an effective manager. Your thoughtful comments can increase productivity and steer an employee in the right direction. Sometimes, however, a particular employee may be falling short, needing more than just a pep-talk. This is where a performance improvement plan (PIP) comes in.

The Society for Human Resource Management defines a performance improvement plan as “a tool to give an employee with performance deficiencies the opportunity to succeed.” Usually developed in partnership with your HR department, a PIP addresses behavior-related issues or unmet job expectations (i.e. sales goals, duties, etc.).

The overall goal of a performance improvement plan is to motivate and guide an employee to get back on track. If you’re not sure where to start, consider SHRM’s 6-step process for establishing a performance improvement plan, outlined in the below infographic. For a more detailed look at the process, visit SHRM.


How to Establish a Performance Improvement Plan (PIP)

01. Identify
In partnership with HR, assess the situation and determine if a structured plan is the necessary next step.

02. Develop
Create a draft plan outlining the timeframe to accomplish specific, measurable goals to improve performance.

03. Review
Make sure your plan is attainable and fair, not just a means to terminate an employee.

04. Implement
Discuss the plan in detail, leaving room for modifications based on employee feedback before signing the final plan.

05. Monitor
Commit to a schedule to review employee progress and provide motivation and guidance along the way.

06. Analyze
Analyze the results. Did the employee meet the goals set in the PIP or did they fall short?

*Source: SHRM – Society for Human Resource Management
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