PIP and SMART Principle – Part Two

Constructing a Performance Improvement Plan (PIP)


Upon deciding that PIP is a suitable solution, the difficult part is drafting a plan for the employee to follow which will be assessed by the superior. Although PIP may not be suitable in all situations, a neat guideline abbreviated as SMART principle serves as a good tool in determining what is expected of the employee. Couple this principle with the ‘5W1H’ questions; the outcome should be clear and specific.

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S: Specific

Be specific of the expected goal. ‘S’ is concerned about what’s to be achieved instead of how to achieve it.

M: Measurable

A crucial step in PIP is to measure the employee’s growth at intervals. Therefore, there must be certain data in place to be used as a benchmark and the employee will know what is to be achieved while the superior knows what/how to assess.

A: Attainable

‘A’ here focuses on what’s to be done or what can be done in order to achieve the specified goal. Consider the avenues, tools and skills needed by the employee. If some are unavailable, what can be done to acquire them or what can act as good substitutes ?

R: Relevant

Improvements are not only confined to the employee’s growth, but at the same time it must benefit the company as a whole. Therefore, goals set must be on employee’s day-to-day major responsibilities which will influence the company’s business.

T: Timely

Timeline is important in PIP because at every interval an employee’s progress must be reviewed. The usual term is 3 months but it can range from 1 to 3 months depending on the circumstances. As for employees working on project basis, the review shall be done according to milestones set for the project.

Carrying out a Performance Improvement Plan (PIP)

‘When there is a dissatisfaction with the performance of a worker (and attitude is a manifestation of performance) then the employee should be given particulars of the shortcomings complained of, an opportunity to overcome them (including a reasonable time to do so) and a clear warning of the consequences of failure to do so … -’ Pinfolds Transport Ltd. V New Zealand Distribution and General Workers Union.

A PIP programme is often scrutinised in terms of adherence to proper procedures. As quoted in the above case, the mandatory procedure consists of 3 steps:

1) Employee should be informed of the particulars of his poor performance;

2) He should be given ample time and opportunity to improve himself; and

3) He should be warned of the possible consequences for failing including dismissal.

An employee may be informed either verbally or through a written letter particularising his short comings. The SMART principle on the other hand shall be carried out under the 2nd step in which the employee will be given specific, clear, attainable, measurable and relevant goals within an ample time. At the end of the 3 months, employers shall be presented with 2 options based on the employee’s performance; whether to graduate him out of the programme or to dismiss him. If the employee performed poorly in all three reviews, the latter choice would be the most sensible one.

Throughout the whole programme, two of the most important things are proper documentation and timely reviews of the employee’s performance. Documentation will serve as proof that the company has done all it could to help the employee if the matter comes to a dismissal, while timely review serves as proof that the company was serious in helping the employee to perform better.


Dismissal is not always the answer to problems faced with your workmen. Other methods including PIP are effective choices to be considered to ensure no wastage of resources and sustainability of business. If followed properly, a Performance Improvement Plan can benefit your organisation in a grand scale with minimised liability.