Implement Performance Improvement Plans
Get employee performance on track before it rides off the rails.
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Last Revised: August 22, 2011
- Managers dread implementing a Performance Improvement Plan (PIP) because they think it’s a waste of time. However, in a recent McLean & Company survey, 68% of employees who were placed on a PIP were still with the organization. When a manager starts the PIP process with a positive attitude towards performance improvement, the PIP is more successful.
- Poor performance can cost an organization more than just hard dollars. Poor performance negatively impacts employee engagement and productivity, as well as customers and other departments. Addressing poor performance through a timely PIP can minimize this impact.
- Organizations risk discrimination and legal challenges when performance improvement efforts are seen as unfair and inconsistent. A consistently implemented process for fair and reasonable PIPs can provide solid supporting documentation should the organization face a legal challenge. In fact, 69% of organizations felt that their legal risk was reduced or eliminated as a result of PIP implementation.
- Managers must deal with poor performance before it begins to significantly affect other employees and the organization’s bottom line.
- The PIP process isn’t about preparing for termination; PIPs are about improving performance so that an employee can make positive contributions to the organization.
- Managers shouldn’t attempt to implement a PIP without HR or legal counsel. The process can become a mine field!
- A negative attitude towards a PIP is a self-fulfilling prophesy. If the manager thinks the employee will fail, the employee will, because the manager is looking for documentation, not improvement. When a manager takes a positive approach with a motivated employee, both the employee and manager can win.
Impact and Result
Experience less grief in the process by:
- Recognizing and avoiding the stumbling blocks in addressing performance issues through PIPs.
- Understanding how different employee situations/profiles affect how the PIP should be approached.
- Setting fair and reasonable performance expectations with a simple template for drafting the PIP.
Save time by:
- Following guidelines when developing the PIP.
- Addressing performance issues before they’ve wasted too much time.
- Avoiding legal investigations through a well documented and fair process.
Save money by:
- Avoiding costly legal battles with an understanding of the high level legal vulnerabilities associated with an ineffective PIP process.
- Turning around an underperforming employee who is impacting other employees’ performance as well as customer experience.
- Relating the PIP process to the risk tolerance of the organization.
Get to Action
See how a PIP fits into the overall performance management process and decide if it is the right course of action
Improve performance of underperforming employees with a timely PIP implementation.
Ensure the developed PIP won't create legal challenges
Develop a fair and reasonable approach to improving employee performance with a well documented and reasonable PIP.
Related Solution Sets
Companies Who Helped
Interviews were conducted with the following individuals:
- Mike Capewell, Consultancy Manager, Dell Corporation, U.K.
- Geoff Ramey, Director, HR, St. Andrew Goldfields Ltd
- Linda Haft, HR Consultant, the HR Office, Inc
- Jacque Rowden, Technology Program Manager, Orrick, Herrington & Sutcliffe LLP
- Martha McIver, VP HR, CBRE
- Jeff Fowler, Quality Control, MOBIS Alabama LLC
- Rene Melchers, Manager IM/IT, Brockville General Hospital
- Two individuals have asked to remain anonymous due to sensitivity of information
A survey directed at HR professionals to better understand their experiences with using PIPs and the outcomes they realized attracted over 100 respondents.