Prioritizing workforce development is essential for maximizing employee productivity and retention. Employees desire career growth opportunities.
Furthermore, businesses require employees committed to continuous improvement to uphold productivity. In addition, they need to maintain high-performance standards.
Performance development plans (PDPs) are excellent tools for keeping managers and employees on track with ongoing performance development, mentorship, and learning.
Find out how to approach PDPs with your team and check out a step-by-step guide for creating one.
What is a performance development plan?
A performance development plan (PDP) is a plan designed to allow managers and employees to align on improving employee performance. It involves setting goals and measuring progress to grow the employees’ skills and improve performance.
Many organizations create PDPs as a standard part of their performance management or performance review process so that employees consistently have a clear set of goals to work towards before their next review.
Performance development plans vs. performance improvement plans
A PDP is a proactive measure that doesn’t necessarily mean an employee is performing poorly or at risk of termination, as opposed to a performance improvement plan (PIP), which is typically a reactive measure of insufficient productivity or performance.
In fact, top performers often benefit from a PDP, as they usually look to take their skills to the next level to secure a promotion. PIPs focus on unmet expectations in the employee’s current role. PDPs often incorporate new skills and growth opportunities to expand beyond their current roles and duties.
Benefits of PDPs for organizations
Making PDPs a regular part of your organization’s human resources practices can provide great results for your business.
Increasing employee engagement
Employees want learning development opportunities, and providing them can make a huge difference in your employee engagement and retention levels. In the 2024 LinkedIn Workplace Learning Report, 7 in 10 respondents said engaging in learning and development improves their sense of connection to their organizations.
A study by Paychex also found that 63% of employees reported that they would be more likely to stay at a company if they were offered better learning opportunities to grow their skill sets and advance their careers.
Retention is a big concern for most employers, so leveraging PDPs and providing development resources is a great way to keep your team engaged and retain them.
Upskilling your workforce
When employees are encouraged to develop their existing skills and grow into new skills, your organization will benefit from enhanced work quality and productivity.
Creating more well-rounded employees through continuous development and upskilling will also help you fill gaps that appear within your workforce.
If someone quits, takes a vacation, or goes on leave, having another team member with the skill set and training required to fulfill essential duties is very helpful.
Benefits of PDPs for employees
Organizations aren’t the only ones benefiting from PDPs; employees can reap several benefits if they follow their development plan.
Obtaining clarity on opportunities for advancement
Most employees would like to grow in their careers or expand their skill sets to move into roles that better reflect their interests, make more money, or achieve a set career goal.
However, there’s often no clear roadmap for the career paths available within a company, particularly in smaller or midsize businesses.
Throughout the PDP process, employees and their managers should have open conversations about the employee’s professional goals and desired career paths.
These conversations and the goals set in the PDP can provide clarity for employees about what opportunities are available for internal growth and advancement.
Setting clear performance expectations
Without goal setting and development planning, performance review season can be stressful for employees. Nobody likes getting a bad review, especially as that can impact job security or raises.
Employees who receive a clear and specific PDP know precisely what to do to get a glowing review next time. This can remove a lot of the anxiety and uncertainty from the process.
Steps to create a PDP
Follow these steps to create a collaborative and effective performance development plan.
1. Review Current Performance
To identify areas for growth, you’ll want to review the employee’s current performance. Keep in mind that finding areas for growth doesn’t just mean looking at where an employee is underperforming in PDPs.
It often means understanding where the employee shows potential and consciously trying to help cultivate that in a PDP.
For example, an employee at an independent contributor level may be showing some natural leadership abilities that you may want to nurture and develop.
In that situation, the PDP may involve taking a leadership development course. Furthermore, it could include getting assigned a mentor within the organization to provide guidance on managing others.
2. Talk with the employee about their goals
Get the employee involved in the process and ask for their feedback. Ideally, a PDP should center on things that the employee also wants to work on, whether that be something they’re having a hard time with at work or a new process or skill they’d like to learn.
This is also an excellent time to discuss career development goals and plans. The direction an employee wants to go in their career should influence which areas you want them to develop.
For example, suppose you’re creating a PDP for a marketing assistant. In that case, you’ll want to know which areas of marketing they have the strongest interest in or would like to specialize in eventually.
Some employers also have team members self-evaluate their current strengths, weaknesses, and development interests to help guide this discussion. This is a common component of performance reviews as well.
3. Collaborate on goal-setting
Once you’ve assessed the employee’s skills and reviewed their self-assessment or listened to their input, it’s time to decide on some goals. When setting goals for a PDP, using the smart goal method is helpful.
Choose goals that are:
Specific: Create specific and narrow goals in what you want the employee to accomplish. Avoid vague statements such as “improving communication” or “learning leadership skills” and dig into the specific, individual skills you want to see improved such as public speaking or delegation.
Measurable: Set metrics that you will use to track progress or otherwise describe how development will be measured.
Achievable: Ensure that the goals you set in PDPs are reasonably achievable. Sometimes, breaking up a large, ambitious goal into smaller milestones spaced across a wider period of time can make it feel more achievable.
Relevant: The goals should be relevant to the career development opportunities the employee seeks or the competencies required for their current role.
Timebound: Set a clear timeframe for achieving each goal. PDPs can include short-term goals for the quarter or longer-term goals that may continue throughout the year.
Remember that these should be individual goals. You can tie personal development planning into team and company-wide goals by creating individual smart goals that contribute to those larger goals.
However, the PDP goals and their progress should be measured on a more individual level.
4. Determine what resources will need to be provided
Consider what resources employees will need to reach their new performance and development goals. PDPs often include training courses, professional development seminars, and in-house resources like an assigned mentor.
Enroll employees in relevant training programs. Assign them a mentor for guidance and support. Schedule regular check-ins to monitor progress and offer assistance.
5. Finalize the performance development plan
Review all of the goals you came up with as a team, create an action plan to complete them, and ensure that all are practical within the timeline established and the resources available.
Decide how each will be measured and set a schedule for any necessary check-ins or mentoring sessions. Then, finalize the plan and add it to their employee file or your HR software platform.
6. Regularly check in on progress
Performance development plans are most effective when managers and mentors stay engaged in the process and check in frequently. Many managers take a set-it-and-forget-it approach to PDPs, often unintentionally, because they get too busy attending to other matters.
However, it’s essential to set some time aside consistently to check in on employees’ development and goal progress between performance reviews. PDPs will only be impactful if their employees and managers stick with them.
Common PDP challenges
Managers and human resources teams often face challenges when creating and implementing PDPs. Here are several challenges to be aware of and some potential approaches for overcoming them,
Time constraints
For small businesses, it can be challenging for leaders to find time to focus on creating PDPs. As you can see from the above steps, it is a somewhat involved process requiring time and focus from management.
One thing that can help businesses overcome this challenge is incorporating technology into their performance and development practices. Handling employee self-assessments digitally before the performance meeting can streamline the planning process.
Following an electronic template for every PDP will make the creation process quicker. Using learning and development software or an HR platform to assign and track goals can also make the entire process more organized and efficient.
Finding time for employees to focus on their development plans can also be challenging. Employees with a heavy workload may need help prioritizing training courses or special projects assigned to their PDP.
Managers play a key role in helping employees carve out time in their work weeks to focus on PDP tasks and training. Having employees block off time on their calendars to focus on training and development is a great way to help them stay on track.
Employee concerns
Conversations around performance and formal plans for improvement often cause employees anxiety and have negative connotations. This can make it harder for employees to be open and willing to participate in a PDP.
While you’re implementing and monitoring the PDP, make a concerted effort to make this a collaborative and positive process. If the employee performs well, confirm their satisfactory performance. Explain that the PDP aims to aid skill development and goal achievement.
Stay engaged throughout the process and provide encouragement when employees encounter setbacks or offer praise when they reach a milestone in their goal progress.
More Resources:
Leadership vs. management: What’s the difference
Succession planning 101: A step-by-step guide for small businesses
Cross training employees: Examples and plans
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