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How to Create a Performance Improvement Plan?

14 min read

When we hear that someone in the team or in the organization has been put on a Performance Improvement Plan, the first thoughts in our heads may be associated with a negative connotation of the concept. A lot of employees believe that it is the first step an organization would take in order to lay someone off. 

In truth, however, this powerful HR tool is used for providing useful training and feedback. When implemented correctly in a quick and effective manner, a PIP can result in very impactful changes in the employees’ performance which would be beneficial for both the employees’ and the organization’s growth. 

It allows you the freedom to approach concerns in a more constructive way rather than jumping into termination of the employee. 

What even is a Performance Improvement Plan? 

If simply put, a Performance Improvement Plan is a documented process of identifying and addressing employee’s performance lags and issues. It involves steps to communicate the action or solution in order to correct poor performance from an employee within a specific timeline. 

A Performance Improvement Plan is a process where the managers and HR collaboratively put efforts into creating a training structure for employees who are having difficulty in keeping up with their peers in terms of delivering results. 

 This helps the employees to improve their work, which will eventually result in reaching organizational goals. 

Why follow a Performance Improvement Plan? 

A Performance Improvement Plan creates a culture of feedback and constant learning that communicates the values of your organization. Creating a plan for improvement rather than terminating an employee when their performance is poor benefits both the employee and the organization. 

Guidance and feedback help employees feel valued and keep them engaged which helps maintaining the employee Morale. Employees are assured that you are invested in them and are willing to help them grow. This results in reduced employee turnover which increases productivity and lowers your costs. 

A good Plan helps you understand how to approach productivity problems and intends to close skill and knowledge gaps. If you do not see the expected results even after applying a PIP, it can be an indicator that the training gap is larger than expected where you might have to try a different approach or broaden your timelines. It can also help you identify issues that may not be fixed with a straightforward PIP, in which case you might have to take actions like termination or change in domain. 

How to create a Performance Improvement Plan? 

Creating a Performance Improvement plan may not be the same every time as the factors may vary from team to team and department to department as the nature of work may be different and the way the performance is evaluated may not be the same. 

However, you may want to keep the following steps in mind which help you determine what approach to take when you have to implement a Performance Improvement Plan for an employee, and helps you have a process in place so that you can address the productivity issues quickly. 

Define the Goals of the PIP

When you are preparing the PIP, keep in mind that you might have to tweak and twist it for each employee as we all have a different pace of learning. Defining the goal will help you how to approach the concern in order to achieve that goal. 

Communicate what results you expect to see at the end of the plan. Can you quantify these results? Setting goals will lay the foundation for your Plan. 

Setting Timelines

Now that you have your goals set, you would have to set up a timeline of when the employee is expected to reach the set goal. 

The timing can depend on the company, employee’s role and the issue that we are dealing with. As a rule of thumb, you may follow a standard time line of 30 days, 60 days or 90 days. 

Make the Plan

Determine what exact steps are to be taken to achieve the goal and try to understand what works best for the employee to reach these goals. Make sure to communicate what happens when the goal is successfully achieved and also what the consequences will be if the employee fails to achieve them. 

Communicate the Plan with the employee

Once the Plan is made, you need to let the employee know about their lag in terms of performance and what the management intends to do about it. 

Explain the goal to the employee, communicate the plan and how you are going to achieve the goal, collect the feedback from the employee if they have any. Make sure the employees understand their part in it. 

Implement the plan and Track Progress

Once you’ve communicated the plan with the employees and they understand their role in it and how they are going to achieve the goals you may then start to put the plan into action. 

Start working towards the specific goals in the set timelines and keep tracking the progress and check if the goal is being achieved in time. 

Evaluate progress and decide on the further steps

If the goals or end results are quantifiable, check on the progress at the end of the deadline and determine whether the expected goal has been achieved. 

If the goal is unquantifiable, determine the progress using other methods to check if the goal has been achieved. 

If the goal has been achieved you can retire the plan and explain to the employee what support is needed from your end in order for them to maintain the achieved success.  

If the goal has not been achieved, however, you may have to take action which may be termination or any other kind of changes. 

Performance Improvement (PiP) for a hybrid Workforce 

Ever since the Pandemic hit us, the working and the office environments have changed for good! We can see that a lot of organizations have adopted a hybrid workforce which has led to confusion when it comes to performance evaluation.

For example, when an employee is working remotely and is struggling, does that indicate that the employee has to be at the office at all times? 

Let’s go over a few pointers that may help you in setting up a Performance Improvement Plan for a hybrid workforce. 

Firstly, the PiPs that we had before remote working, do they even work anymore? 

That would depend on the process that was followed before. Generally, a performance improvement plan is put together by the managers in collaboration with HR which should still be the case, however, it can be a bit more complex when people aren’t together but it is crucial to have managers and HRs working together in preparing and processing the Performance Improvement Plans. 

Regardless of whether the conversation is happening in person or over a virtual call, it is important that the HR and managers put in a collaborative effort in the PIP process. 

The same PIP may not be suited for all the departments in an organization, a good PIP should be tailored for each department while still being consistent across the organization.  

Together, they can ensure that the expectations are communicated clearly and see to it that they are properly documented. Properly documenting these make sure of efficiency and promote transparency throughout the process and help in building trust with the employees. 

Are your managers prepared to manage a remote team? 

Managing a team at the office can be very different from managing a team remotely. Companies may have ignored this initially as remote working was assumed to be temporary, however, now it is pretty clear that remote work is here to stay and it’s not going away anytime soon. 

It now becomes a necessity for the managers to be trained to handle and manage a team remotely. 

Do you have all the necessary tools for communication? Are all your meetings scheduled on time? Ensure that your managers understand that there is always downtime even when the employees are working from the office, like going for a quick coffee break or chatting with another coworker. Similarly, it is not fair to expect the employees to be constantly at their desks typing something or the other when they are working remotely. It’s completely fine to have a walk while you are attending a call as long as you don’t need to pay a lot of attention to the screen or make notes. 

Are you managers building the same kind of relationship with the new hires as they have with the older employees? 

Over the last two years it was observed that organizations have faced huge turnovers and most of them were from the new hires. 

Building and maintaining the bond with your coworkers can be tricky and challenging but it is important for a healthy and a happy team. Knowing more about a person would help you empathize with them and improve the morale of the whole team as you work better together with people you would have empathy and personal connections with. 

Managers should prioritize and take time in team-building activities so that the employees get to know each other better. 

This helps in work as well. When the employees are cooped up in their home offices, they might not be aware of whom to reach out to for help. Help your employees to know each other as it helps in engagement and builds a stronger company culture. 

In conclusion, we need to pay attention to details in order to enhance the performance of the employees as in remote work, we may not be able to see our employees regularly, which would leave us clueless about how they are actually doing outside of their work.  

The things that impact a person’s performance in their work are not always work related and it is important to make the employees feel comfortable enough for them to share what’s on their mind which could potentially be affecting their work or performance. 

It is important to remember that one can only help someone improve when they know what exactly is keeping them from doing better. 


PIPs are the key factor to unlocking employee potential to achieve organizational goals. To attain this benefit, you can determine how to implement the Plan. You can also create PIP templates get you started and make the job easy. 

The powerful HR tool when used rightly should not pose as a threat to the employee but should show the organization’s willingness to invest in their growth and their future in the company. 

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    Meet the author

    Balaji Sogathur

    Trying to get my head out of the world of anime and manga and adding bit of that flavor in my work is not just fun but also satisfying. My ignition on the creative engine never goes off, maybe you’ll see a bit of that in my puns.


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