Capterra Glossary
Performance Improvement Plan (PIP)
A performance improvement plan (PIP), sometimes called a performance action plan, is a document used to help underperforming employees succeed. A PIP will identify areas where improvements need to be made in performance, skills, and training. It will also clarify all goals the employee needs to meet within a certain period or be subject to disciplinary action (e.g., suspension, demotion, termination).
What Small and Midsize Businesses Need to Know About Performance Improvement Plan (PIP)
Human resource managers use PIPs to guide managers and their staff. HR helps determine if a PIP is appropriate and assists when the plan is used. PIPs offer many advantages to businesses, including identifying and addressing performance issues, reducing time and costs to rehire and train a replacement, and creating an accountable workforce.