Putting a problem employee on probation is the most serious step in managing performance improvement. It's meant to be serious. This is the employee's last chance to become a satisfactory employee by performing up to your expectations.

Prepare a detailed memo to the employee and copied to your supervisor (if any) and Personnel File. The subject line can simply say "Probation." Start the memo by stating the purpose of it is to put the employee on probation, beginning immediately.

Most of the memo concentrates on discussing the individual issues you are having with this employee. After each issue, provide a detailed explanation of what action you want the employee to take, and a reasonable deadline for completing the action. Provide as much detail as is needed to ensure your employee will fully understand your expectations. Each issue can be broken down into manageable actions and deadlines, such as weekly or monthly deadlines that will move them toward final goal.

An example of an issue, action, and deadline might be:

Issue:  Making our sales quota each month is essential for the company's continued success. Your monthly sales are consistently below your quotas by 25% and our previous discussions regarding this issue have not resulted in any improvement.

Action:  Your sales numbers must at least make your quota every month.

Deadline:  Your sales must be at least 80% of quota within 30 days; 90% within 60 days; and at quota within 90 days.

In closing the memo, comment on two things. First, let the employee know you are available as a resource but that it is up to them to succeed. Second, end the memo with a statement that spells out the consequences of an unsuccessful conclusion to probation. My favorite is: "Failure to meet and maintain the goals outlined above may result in further action, up to and including termination."

Put a "Read and Discussed" phrase at the bottom, followed by a line for the employee's signature. The original copy that the employee signs goes into their personnel file. Another original is for the employee (the employee doesn't have to sign their own copy).

Your attitude throughout this process needs to be positive … positive that the employee can and will improve. The improvement and retention of your employee is important for two reasons: (1) it sends a message to other employees that you won't just give up on them if they're not perfect, and (2) it saves you a lot of time and money in recruiting and training a new employee.

The next, and last, in this series discusses your follow-up throughout the probation period and the final decision.