HR Glossary
Performance Management Cycle

Performance Management Cycle

Updated on:
August 22, 2022


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Table of Content

What is the Performance Management Cycle?

The performance management cycle is a process that companies use to evaluate how effectively they are meeting their objectives. It is a set of activities that help measure performance.

It can be done on an annual basis or on a quarterly basis. The goal of performance management is to help organizations set goals, evaluate their performance against those goals, and make plans to achieve them.

Performance management takes into account trends in performance. After the evaluation, organizations can seek to identify ways to improve their performance.

The performance management cycle consists of four activities

  1. Setting goals and metrics
  2. Goal setting and measurement
  3.  Performance measurement
  4. Performance appraisal

Why Use a Performance Management Cycle?

Because it improves company’s success and these work in two ways: 

  1. Employees are able to reach their potential and have greater involvement in their professional development with the help of tools that boost engagement.
  2. They help to improve productivity by making sure that the work goals of each employee fit in with the strategic goals of the organization.