The PIP—Performance Improvement Plan

Three letters, PIP, strike fear into the hearts of sales people and managers alike.

It’s called different things, the PIP, the Performance Improvement Plan, the Measured Mile…… Typically, it’s the final straw in dealing with poor performers.

Frankly, I think they are a pure waste of time and we should get rid of them—at least the way we currently use them! I can hear HR VP’s moaning, Corporate Counsels thinking “Has this guy every heard of a lawsuit? Along with the cheering from lots of managers? And a lot of people who are on a performance improvement plan or have been through one, wondering about my compassion and fairness.

Let me explain why I think PIP’s in their current incarnation are useless. They are a waste of time for both the manager and the employee.

The problem is, by the time we get to the point of putting a PIP in place, most of the time, the outcome is a foregone conclusion—“90 days and I fire his ass!” “We’re doing it because HR says we have to do it to be fair, the lawyers say we have to do it to avoid lawsuits, and it’s just what we’ve always done.”

Both the manager and employee dread sitting down and entering the process because we know the outcome–and each is counting the days. The employee may try to do the plan, at least buying time, the manager goes through the motions. Each person dreads every meeting, but the manager is carefully documenting things for HR and the lawyers. At the same time, the employee is brushing up their LinkedIn profiles, perusing the job boards, starting to look for new opportunities, hoping to jump to something as soon as possible.

We waste a lot of time and energy with Performance Improvement Plans, when the outcome is a foregone conclusion So we should eliminate them!

We should never put someone on a Performance Improvement Plan unless both the employee and the manager are TOTALLY committed to a successful outcome—after all that’s what PIP means–Performance Improvement.

If neither of us believes performance improvement is possible, we’re just wasting each other’s time. To me, the solution is, buy the person out. If both of you aren’t totally committed to a successful outcome, give them 3 months–even 4 months salary. Tell the employee they can spend that time more effectively looking for a new job. Instead of waiting or the inevitable but still “working,” struggling but counting the days until it happens–give the employee the time to start finding a new job. As a manager, save yourselves the time, the hassle, and ill-will. Spend your time where you can have greater impact. Let go and let each person move on.

When I talk to managers about this idea, some get stingy, “Why should I pay this person?” My response, “You’re going to pay them anyway. They are still on the payroll for the duration of the plan. Then you’ll probably pay some sort of termination settlement.” Then I add, “Think, also, of the amount of time you are going to spend, knowing you have a predetermined outcome. Why waste your time when you already don’t believe there will be a successful outcome?!?”

It’s a real lack of respect for the individuals involved and for the performance planning process to enter into a PIP with a predetermined outcome. If you know the outcome, why do you respect them so little to play this game?

When I talk to employees about it, I ask, “Do you think you can really achieve the goals that have been outlined in the plan?” Some are hopeful, but when upon further discussion, many see the plan as unrealistic and unachievable (it may be, sometimes managers do that), or they are really worried, they don’t want to be without a job. I get it, being fired is terrifying. But if that’s the inevitable conclusion, based on the attitudes of both the manager and the employee, isn’t it better to end things now? Isn’t it better to take the time, regroup, and spend 100% of your time finding the right opportunity. I tell them, “take the money now, walk away, spend your time getting a new job rather than being frustrated on something that has little chance of a positive outcome.”

Now here’s the scary part of the discussion, I like PIP’s, they are very powerful, but only when each person (and the rest of the organization) is TOTALLY committed to doing what it takes to achieve a successful outcome. If we both believe performance can be improved, then we need to be committed to doing the things that drive the improvement. The individual needs to know what is expected and have a realistic plan, developed with management to achieve the goals. The manager has to be committed to provide the support, coaching and resources necessary to achieve an the desired outcomes.

Short of this, we are wasting our time.

What do you think?


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