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Performance Management is a long term process that focuses on continuous performance improvement or “change” for short. Its goal is to create a climate of shared understanding about what is to be achieved, and then developing people to increase the chance that it will indeed be achieved.

A lot of people associate performance management with the annual performance review. While it can and often does include performance reviews, it goes far beyond it in that performance management looks at improving performance as a daily activity, rather than just a semi-yearly or yearly event. In addition, some people relate performance management with Taylor's Scientific Management. However, Taylor's method focuses mainly on the time and motion studies of processes; while performance management is more about focusing on people, or to be more exact — helping people to develop so they can perform in an ever changing world.