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The Performance Improvement Plan

First, a story with a protagonist I adore: my little brother, Thomas. At 24, Thomas is a classic millennial who is currently making his way through med school. But, my story is not about med school or about millennials’ often infuriating approach to pretty much everything (e.g., unicorn pool floats, avocados, job expectations*); rather it’s about Thomas’ first ever performance review at his first “real” job post college. Thomas had been working at this consulting company for a full-year when he walked into the review not knowing what to expect. His manager and his manager’s manager were both there, and they presented him with a performance improvement plan. Thomas immediately assumed that the performance improvement plan was just a formality before getting fired. Before the managers had a chance to delve into the feedback, Thomas thanked them for the opportunity to work at the company, stated that he didn’t agree with the PIP, and promptly resigned on the spot. Without waiting for a reaction, he walked out of the room and then the building (gotta hand it to the boldness of millennials, right?!?!).

I love this story because of all that it tells us about managing performance, managing people (especially new, young employees (!)), and giving and receiving feedback. An employee shouldn’t be surprised by a performance improvement plan and only hear improvement areas once a year. On the other hand, an employee shouldn’t react so brashly to constructive feedback. A manager shouldn’t use a performance improvement plan as a pro-forma check-the-box step to fire someone. And, an employee shouldn’t interpret an improvement plan as a sly way of pushing him out of the company. The list goes on and on.

As we head into the end of the year, performance assessment and improvement plans will become even more top-of-mind for you as a manager. Today, I'm going to delve into one small part of the performance equation: the performance improvement plan (not so lovingly referred to as a "PIP").

As a manager, you will need to understand when someone is underperforming and what to do about it. To be a great manager, you should not be afraid to use performance improvement plans as a way to clearly articulate ways that your team members can get better, as long as the performance improvement plans are coupled with ongoing feedback, a clear understanding by all of what they are (and what they aren’t), and a true commitment by the manager to help the employee improve.

But, before we get into the nitty gritty of how to put together this much-demeaned tool, let’s first briefly talk about why it’s sometimes difficult for us as managers to accurately assess someone else’s performance.

Why It Is Hard To Objectively Assess Performance

1. The Ladder of Inference: we quickly and subconsciously take data and make high-level inferences about individuals and their behaviors that might not be valid. This is why when we’re giving feedback or articulating why someone is not meeting expectations, we should start from a place of data, not a place of inference (e.g., someone who misses deadlines is deemed disrespectful; someone who stumbles during public speaking is immediately coded as inarticulate or has poor client service skills). The ladder of inference gets even worse when two people come to vastly different conclusions about each other based on the same pool of data (as is seen in example below!)

2. Attribution Theory: This theory states that we attribute others’ poor behavior to their intrinsic personality, motives or beliefs that are within the realm of their control. And we attribute our own poor behavior to external environmental forces or influences outside of our control. Put bluntly, if someone else is late, it’s because he is lazy and disrespectful. If I’m late, it’s because the bus wasn’t on time, it was raining, the person in front of me was walking slowly, etc…

Attribution theory and the ladder of inference are important to be aware of as a manager: as you evaluate performance, it’s important to stay at the place of data and not at the place of inference and attribution. A good PIP articulates the actions or behaviors that need to be improved, not the intrinsic "way someone is". And, a good PIP provides an opportunity to better understand if and when external forces outside of your employee's control may be influencing behavior.

Okay –so you’re aware of the biases that may affect how you judge someone’s performance, you’ve clearly laid out expectations, given lots of feedback, and your employee is still not meeting the bar. What’s next? Time to create a performance improvement plan.

Guiding Principles for a Good PIP

1. A PIP can be created any time throughout the year

2. PIPs are for employees who are not meeting expectations in their current role as defined by their manager – this could mean an employee who is having difficulty making the leap to the next level and just can't seem to get promoted.

3. PIPs are consistent across the organization in their structure and management of the process. (Want a good PIP template? Shoot me a note and I’ll send you one!)

4. PIPs are NOT a “check-the-box” step to let someone go; rather, they are used to provide precise, clear expectations for improvement on a defined timeline

5. PIPs focus on 3-4 actionable areas of improvement with clear examples of how the individual can improve in these areas. (NB: If, as a manager, you’ve fallen into the attribution traps outlined above, this will be the hardest part of the PIP.)

6. PIPs clearly lay out a timeline, as well as how and when the manager is going to check-in on how the employee is doing against the PIP (put this in writing! It’s just as important to hold yourself as a manager accountable as it is to hold the employee accountable!)

7. Nothing in a PIP should ever be a surprise – at the very least, the manager should verbally talk through what is in the PIP before the written document is produced. In an ideal setting, the employee should be getting real-time feedback along the way.

Along with the above, there are a few cultural changes you can do to ensure that PIPs are used appropriately.

  • For one, to ensure that people don’t assume PIPs are just the final step before being let go, celebrate and hold up examples of folks who have successfully used PIPs to get to the next level.

  • If possible, have the employee help to jointly create the PIP. As a manager, you may outline the high-level areas that the employee needs to work on, then work with the employee to articulate ways that the employee is going to demonstrate competence and improvement.

  • Put employees on PIPs early (before problems get out of hand) and take them off early if they’ve demonstrated improvement and success sooner than anticipated.

As a manager, it's important to understand why your employee is underperforming and then put in place a clear plan for how he / she can get better. Often, what I've seen is that a PIP is just as important for the manager as it is for the employee. It helps both the employee and the manager get crystal clear on what is expected from each of them. Will a good PIP process prevent your team member from walking out of a performance review and then right out of the building? I can't guarantee it, but I'm hoping the probability will be greatly reduced. On the other hand, it's hard to predict millennials....

*My favorite stat: A third (33%) of millennials believe it is acceptable to text during a job interview.. YIKES.


  • As a manager, it's important to be comfortable putting your team members on performance improvement plans when they are not meeting expectations of performance.

  • When assessing someone's performance, there are subconscious biases that may come into play that inhibit us from being completely objective with how someone is performing.

  • The Ladder of Inference happens when we quickly make inferences about someone's behavior that might not be valid; often we attribute someone's poor behavior to intrinsic personality flaws, whereas we attribute our own poor behavior to external forces outside of our own control.

  • A good PIP process is consistent, not surprising, time bound, and lays out clear action items for the person to work towards.

  • Along with a clear process, you can create a positive culture towards PIPs by celebrating when an individual comes off of a PIP and holding up positive examples of when a PIP was helpful.


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