Successful performance management? Apply the strategic performance management development cycle!

This paper seeks to provide a method which increases the chance of successful implementation and use of a performance management system (PMS). This method should incorporate both the instrumental and behavioral sides of performance management, be based on a solid theoretical foundation, and have been proven in practice.

The method is called the strategic performance management development cycle, which consists of three stages: design a strategic management model; design a strategic reporting model; and design a performance‐driven behavioral model. The workings of the cycle are illustrated with a case study of a publishing company which used the method during the implementation of a new PMS.

Applying the strategic performance management development cycle makes it possible for an organization to create in a short time period a new PMS, which will then improve the organization's results dramatically.

During the implementation of a PMS an organization has to expressly pay attention to all three stages of the strategic performance management development cycle, in order to increase the chance of a successfully implemented and used PMS.

It has been reported that 56 percent of PMS implementations fail, meaning that these implementations do not result in a PMS that is used regularly by all people in the organization. This article describes an implementation approach which is based on a solid theoretical foundation, has been proven in practice, and will give organizations a better chance of a successful PMS implementation.