How to Establish an Effective Performance Improvement Plan

Are you a business owner looking to maximize the performance of your employees? Do you want to motivate them, and ensure each team member performs at their best? Establishing an effective Performance Improvement Plan can help you achieve that. 

An effective and long-term Performance Improvement Plan has the potential to help employees increase productivity. It can also help employees focus and raise standards in their work. 

With the changing business environment, employers must maintain the performance of their teams. An employee assessment is important to align the company’s objectives. This involves consistency and keeping up-to-date with the latest market trends and demands. 

Thus, a system that holds teams accountable for their work must be set up to ensure strong organizational links are maintained.

This article will discuss how businesses establish a Performance Improvement Plan that yields the desired results.

What Is a Performance Improvement Plan?

A Performance Improvement Plan (PIP) is designed to help underperforming employees. The plan identifies and corrects issues that hinder them from reaching their full job potential. 

A PIP sets specific goals and guidelines to help an individual employee improve their performance. 

After many attempts to address the employee’s work performance concerns, the employer can implement the plan. 

The employer then creates a PIP document that outlines the issues and identifies the actions the employee must take. 

The PIP document includes the following:

  1. Specific goals and objectives: The PIP must include clear and measurable goals the employee should achieve. These goals should be related to the performance issues that the supervisor identified.
  2. Timelines: The PIP document should include timelines for achieving the goals. The timelines should be realistic and achievable.
  3. Support and resources: The document should identify the support and resources provided to the employee to help them achieve their goals. This may include training, coaching, mentoring, or extra resources.
  4. Consequences: It should also outline the consequences of not meeting the goals outlined in the PIP. This may include disciplinary action or termination of employment.

Factors to Consider for a Hybrid Work Environment

Implementing a PIP for hybrid work models requires careful consideration. 

Here are some steps to follow:

  1. Establish clear performance expectations: Communicate them to all employees, regardless of their work location. This includes outlining specific goals, objectives, and timelines for achieving them.
  2. Create a comprehensive PIP: Develop a comprehensive PIP with clear and specific goals and objectives. Ensure the PIP is tailored to the individual employee and their work situation.
  3. Leverage technology: Use technology to ease communication between managers and employees, regardless of work location. This can include video conferencing, messaging apps, or project management tools.
  4. Be flexible and adaptable: Recognize that a different work environment may have different needs and challenges. Be flexible and adaptable in your approach, and be willing to adjust the PIP as needed.
  5. Document the process: Document the PIP process, and the employee’s performance throughout. This is to protect the employer from potential legal action. This can include keeping detailed records of performance evaluations, check-ins, and progress updates.

Steps To Establish an Effective Performance Improvement Plan

Establishing a Performance Improvement Plan is essential to improve your team’s performance.

An effective PIP improves employee performance and helps to create an agile working environment. That can result in better planning and decision-making. 

Here are the steps to start a successful and efficient PIP from scratch:

performance improvement plan

1. Identify the Need for a Performance Improvement Plan

The first step in establishing a PIP is identifying the need for one. This involves recognizing poor performance, gathering evidence, and communicating with the employees. 

Signs of poor performance can include:

  • Missed deadlines 
  • Consistent errors or mistakes
  • Decreased productivity
  • Negative feedback from customers or colleagues. 

Gathering evidence involves documenting the employee’s performance issues, including specific examples and incidents. Communicating with the employee is essential in identifying the need for a PIP. 

2. Create an Effective Performance Improvement Plan

Once the employer identifies the need for a PIP, the next step is to create an effective plan. 

This involves defining clear goals and expectations that are specific, achievable, and relevant. It is important to set realistic timelines and provide support and resources to help employees achieve their goals. 

The PIP should also establish consequences for not meeting those expectations.

3. Review the Plan: Ensuring Fairness and Attainability

When reviewing a PIP, a supervisor should ensure no bias against the employee. 

The focus should be on addressing the performance issue fairly. 

For example, if a salesperson is given a sales goal far beyond what the employee assigned can achieve, then the aim needs to be lower. 

An adequate onboarding effort should be in place for new employees to help acclimate them. 

The key to this step is ensuring the PIP is attainable and fair. It should not be viewed as a means to end an employee. But, rather, as a process-oriented approach to help employees improve their performance. 

A supervisor should approach with understanding, and provide support to help employees achieve their targets. 

4. Implement the Performance Improvement Plan

This step involves communicating with the employee and addressing concerns and challenges. Employees can communicate effectively by:

  1. Scheduling regular check-ins to discuss progress and provide feedback.
  2. Providing constructive feedback on what the employee is doing well, and what they need to improve.
  3. Encouraging open communication, and listening to the employee’s feedback and concerns.

One of the key components of an effective PIP is addressing any concerns that may prevent the employees from achieving their goals. 

This involves identifying obstacles hindering the employee’s performance, and developing strategies to address these challenges. 

For example, if the employee struggles with a particular task, providing more training or resources can help them overcome that challenge.

Supervisors can also help the employee by involving other team members. This can include assigning a mentor to work with the employee that can provide feedback and support. 

It’s also important to encourage employees to take ownership of their improvement plans and ask for help when needed. 

5. Evaluate the Effectiveness of the Performance Improvement Plan

Evaluating the effectiveness of the PIP involves establishing metrics and benchmarks to measure progress and success. 

Assessing whether the PIP has successfully addressed the performance issues is essential.

Ask questions such as:

  • Did the performance of the employee improve?
  • Were the areas of weaknesses addressed?
  • Did the employee meet the PIP’s expectations?

If the PIP is successful, it’s important to recognize the employee’s accomplishments. Celebrating successes can motivate them to improve even more, and excel in their roles. 

On the other hand, if the PIP has not been successful, it’s important to identify any shortcomings and make necessary adjustments.

6. Conclude the Plan

The employer must formally close the PIP. 

Suppose an employee is unable to improve, or their performance worsens. The employer can close the PIP and consider possible reassignment, demotion, or termination.

Extending the plan may be worthwhile, and give them more time to succeed. This only applies in cases where the employee is committed to improvement.

If the objectives of the PIP were realistic and within the employee’s control, there is still potential for success. Employees can end the plan based on the improvements achieved in such cases. 

Frequently Asked Questions

1. Why is a Performance Improvement Plan important?

A PIP is important because it provides a clear roadmap for improvement. It establishes goals and provides ongoing support, feedback, and coaching to help the employee.

2. How do I approach an employee about implementing a PIP?

It is important to approach an employee about implementing a PIP with thoughtfulness. Start by having an honest conversation about performance issues.

3. What happens if the employee does not improve after implementing a PIP?

If the employee does not improve after executing a PIP, the employer can consider serious actions. This includes reassignment, demotion, or termination.

Closing Thoughts

A PIP is an important tool to address performance issues in the workplace. Managers need to approach the implementation of a PIP with care and thoughtfulness. The plan should be clear, specific, and achievable, with realistic goals and objectives. 

It is important to be prepared for the possibility that the employee may not improve, despite the PIP’s implementation. The plan should have goals and objectives that are achievable to the employee’s job responsibilities. 

By following the steps outlined in this article, employers can build a culture of continuous learning and development. 



Award-winning recruitment software that will find, attract, hire and analyse the way you want to work. At LogicMelon, we have experienced software recruitment marketing specialists to help you build effective recruitment solutions supported by the best customer service you’ll find anywhere!

Email: or call LogicMelon (UK) +44 (0) 203 553 3667 (USA) +1 860 269 3089

This entry was posted in Blog post | Recruitment | Tools & Tips