A performance improvement plan (PIP) is a supportive, structured process outlined in a formal document. It is designed to help an employee get back on track and achieve their full potential when their current performance falls below established job standards.
The PIP serves as a focused roadmap for personalized employee development, clearly outlining the specific areas where performance needs to improve and the measurable goals the employee needs to reach.
The format is similar to a contract and includes:
- A clear statement of the specific performance issues (using objective examples or data)
- Measurable goals for the employee to achieve
- A defined timeline (e.g., 30, 60, or 90 days)
- A list of specific support and resources (like training, coaching or mentoring) the company will provide
- A schedule for regular check-ins to monitor progress and clarifying the consequences if the required improvement is not met.
A PIP may be perceived as a way to put pressure on an employee; however, when implemented correctly, it becomes a tool for respectfully motivating and uplifting a person who is not performing to the required standard for their current position.
The role of the performance improvement plan in performance management
When combined with a skills gap analysis, PIP helps managers address significant performance gaps fairly and consistently. It can be used to verify that both employee and manager are aligned on the path forward, giving the employee a clear, time-bound opportunity to demonstrate commitment and growth. This ultimately fosters a culture of accountability and continuous improvement. Modern performance management software often facilitates the PIP process by providing templates, automating goal-tracking, and centralizing all related documentation and feedback.