How to Do Performance Improvement Plans Right

How to use PIPs effectively for your employees


I know what you’re thinking, This sounds so corporate. It does, but hear me out anyway. Performance improvement plans (or let’s just call them PIPs), can save you from severing someone from your company.

If you think everyone deserves a second chance, this is where that knowledge comes into play. It gives your struggling team member an effective plan to give second life to their performance. Sometimes, people just need guidance — we all lose our way time to time.

With that said, here’s how to do PIPs the right way.


PIP myths

Before we get into the nitty-gritty of things, let’s discuss how team members often feel when they hear about performance improvement plans. The first thing that comes to their mind is, Oh no, I’m getting fired.

That’s not the case at all. PIPs aren’t supposed to be intimidating. Employees should think of them as a helping hand; guidance as to how to improve. Have them think of it this way: if you wanted to fire someone, you’d do just that, not spend time customizing an action plan for those struggling!

PIPs the right way

Performance improvement plans are there to help, not hurt. The correct way to draw up a PIP is to include recurring performance issues (they need to know what to fix, right?) and goals for them to achieve in those categories. You can also let them know in the document that failure to retain good standing could result in severe repercussions.

The point is to give them concrete advice so they can improve their performance. Knowing what needs to be worked on is sometimes enough to get them motivated. If they’re in a slump, this might be the kick-in-the-butt to get them out of it.

PIPs for success

It’s worth noting this document is like a two-way street. It requires communication on both parts. Your employee on a PIP should check in with either you, their manager, or HR. If they have questions, make sure they can get clarification. They’re probably a little freaked out being on a PIP, so open the lines of communication so they can be successful (and, in return, your business can be successful).

You can also pair your struggling employees with ones that are stellar performers. By letting them shadow the top team members, they can see first-hand how they conduct themselves and excel at their work. It’ll help build their confidence, instead of them fearing a firing.

Your employees will appreciate PIPs

Sometimes we get lost in our careers. It doesn’t matter if you’re an owner, manager, or entry-level employee — it happens. PIPs shouldn’t be anything to fear. If anything, when used the right way, they’ll help struggling employees get back on their feet and improve their performance.

Need help putting together a solid team? Take a look at my Total Team Makeover course.

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