What is performance management?

Performance improvement is a strategy within performance management that helps employees achieve improved performance and development. Managers typically use performance improvement plans (PIPs) to help low-performing employees meet the organization's standards and requirements in terms of both productivity and behavior. This is called operational or individual performance improvement.

On the other hand, performance improvements also occur in the following situations:

• Team Level
• Department Level
• Organization Level

Improvement plans at these levels are known as organizational performance improvement.

How is performance improvement measured?

Organizations can use a variety of metrics to measure performance improvement.

At the individual level, managers can track an employee's progress over time in the following ways:

• time cards
• peer feedback
• Quality Control
• Performance Reviews

While the need for performance improvement is universal, the methods for measuring improvement vary. It is essential to recognize that the performance improvement plan structure is only effective when the respective performance issues can be resolved with a structured plan and time-sensitive goals.

For example, quantitative shortcomings such as sales goals or production quotas are well suited to a performance improvement plan because tracking the goal simply requires measuring whether the numbers are improving. Qualitative matters such as poor leadership or abusive behavior are much more challenging to fit into a structured plan and track over time.

Why is performance improvement important?

In order to become better, employees and managers must first identify areas that need improvement. Performance improvement plans help teams understand what's working and what isn't, and identifying problems that teams face helps companies find targeted solutions rather than relying on unfocused efforts to improve.

Performance improvements can lead to real benefits such as:

• Improve employee productivity
• Reduction in work related errors
• Better work quality
• Increased employee satisfaction
• Less time spent redoing tasks

When should you use a performance improvement plan?

Using a PIP to address poor performance is often a better solution than sacking an underperforming but valuable employee. Rather than removing the employee and losing their future potential (along with the investment in their recruitment and training), these plans target any poor performance or unacceptable behaviour and provide a path to change.

Beneficial PIP Conditions

Below are some examples of where PIP is most appropriate:

• An employee meets expectations in most performance areas.
• A player who has historically performed well has been facing problems recently.
• An employee is facing personal challenges, but his or her window of opportunity for relief is running out.
• A hard-working new employee needs more time to learn the necessary skills during the probation period.

Avoid PIP situations

Conversely, implementation of PIP may not be as effective as expected in the following situations:

• A good employee is placed under a new manager with higher performance standards.
• A long-term employee has a history of average performance but has never received feedback and has no strong motivation to improve actions or behavior.
• The problematic employee is already at risk of being fired or is intent on leaving the company.
• An employee discovers that their qualifications do not match the new job requirements.
• An employee becomes involved in a serious incident such as theft, violence or gross insubordination.

Before a PIP can be initiated, there must be clear communication and collaboration between the parties involved. Imposing a tailored plan on an unsuspecting or unwilling employee often does more harm than good, dooming performance improvement before it even starts.

What is the time frame for a performance improvement plan?

A good performance improvement plan is time-bound - the employee concerned must accomplish actionable objectives within the indicated time frame, which is often 30 to 90 days. After the PIP time frame has expired, there must be a commitment to continue improving the areas addressed.

What types of performance issues might benefit from a performance improvement plan?

A performance improvement plan is not a panacea for all unsatisfactory employee performance. For example, it is better to address attendance-related issues and disruptive behaviors when they occur rather than bringing them to a formal review. This not only helps the employee deal with the problem, but also helps the employee's co-workers replicate your organization's standards.

Below are some of the performance issues that a comprehensive PIP can address:

• missed deadlines
• Unfulfilled goals and objectives
• Poor work quality
• Bad team behavior

Once performance gaps are identified, the formal plan should have established objectives, clear actions or strategies, milestones, and measurable metrics to determine improvement. It is also important to schedule coaching sessions and regular meetings during the PIP time frame to track progress.

Employees must understand that they must meet the indicated PIP objectives to avoid consequences. While management should give employees on PIPs every opportunity to improve with their full trust and support, the stakes and timelines must be clear regarding demotion, reduced pay or job loss.

What is the difference between quality improvement and performance improvement?

Many people think that quality improvement and performance improvement are the same, but they have some important differences.

Both processes take a systematic approach in solving problems, but they tackle different issues. Performance improvement addresses deficiencies in human performance, while quality improvement focuses on the organization's processes and systems.

• Clear job expectations
• Timely performance feedback
• Increasing motivation
• Investing in the skills needed

Quality improvement is more inclined to consider broader interventions to improve working conditions, environment and available support.