In my experience, performance improvement plans (PIPs) have a lousy return on investment. On rare occasions, they’re useful in fending off an employee claim of wrongful termination. However, in terms of the stated purpose—performance improvement—the returns are often dismal. Sometimes there’s improvement but it isn’t sustained, and a “PIP cycle” sets in. Other times, the PIP just makes things worse.
Why?
Most PIPs are formalistic, negative, adversarial documents. They specify only what’s wrong with the employee. They’re blame-oriented, punishment-oriented and often accompanied by threatening language such as “will subject you to further disciplinary action, up to and including discharge.”
