Performance management systems aren’t static. They are living (and hopefully thriving) systems that require constant refinement and recalibration. As organizations grow, so too must the maturity of their performance management practices. But how can leaders recognize when their organization is truly ready to take the next step?

In this report, we explore the key signals that indicate when an organization is on the verge of advancing to a higher level of performance management system maturity. From how strategy and goals are defined and executed to how performance is measured and integrated into everyday culture, the transition to a more mature PMS is complex. Fortunately, there are clear markers along the way.

To bring this to life, we’ve gathered insights from our in-house experts in strategic planning, performance measurement, and performance culture. Each of them highlights specific signs that organizations should look for to know that they’re ready to take the next step toward sustainable, high-impact performance management.

What does this shift look like in action? How do you know when your organization is moving from a reactive, disjointed system to one that is strategically aligned, data-driven, and performance-embedded at all levels? Let’s find out.

Strategic Planning: The Visionary Lens

To help us explore how an organization can transition to a higher level of strategic planning maturity, we turn to Cristina Mihăiloaie, Strategy and Performance Management Expert and Head of Product & Innovation at the Global Performance Audit Unit (GPA Unit). Cristina has extensive experience in both research and practical strategy development. She has spent over a decade guiding organizations across industries like oil and gas, finance, telecommunications, and manufacturing to improve their strategic approaches and performance systems.

When it comes to the common practices that organizations rely on in their strategic planning processes, Cristina highlights the foundational approaches that are typically in place across many businesses. These are the starting points for organizations on their journey toward greater maturity in strategic planning:

“In most organizations, strategy planning is an annual event where objectives, KPIs, and initiatives are reviewed by a specialized function such as the Strategy Office or an internal committee. While the process is formalized and clearly defined, it tends to focus on past data and is often a reactive response to market conditions. The final strategy, after several workshops among top management, is approved and communicated across the organization.”

When organizations begin with these foundational practices, they establish a solid base for strategic planning. However, as companies evolve and aim for higher maturity, these initial practices—while necessary—are no longer sufficient to drive long-term success. The next step involves moving beyond this reactive, annual review process and embracing a more dynamic, integrated approach. 

So, what signals should organizations watch for as they transition to a higher level of strategic planning maturity? Cristina identifies several key traits that mark this shift toward a more mature, forward-thinking strategic planning process.

“There is a strategy, before moving into planning. It may sound logical, but not all organizations are skilled at precisely defining their vision, mission, and how they want to position themselves to win the market.

1. The Extensive Yet Focused Involvement of Stakeholders

Mature organizations develop extensive stakeholder engagement plans. Throughout the year, they engage constantly with all their business partners, clients, and other external stakeholders to understand their expectations. They also establish effective communication channels from the bottom to the top of the organization, so on-the-ground issues as well as potential solutions are being heard at the top level. Moreover, the strategy team identifies the most efficient manner to involve each category of stakeholders, and it does not try to do this in a six-week strategy planning process, but during the entire year. Thus, a variety of perspectives are collected, converted into insights, and made available to the top management team to analyze and decide the best approach.

2. Data-Driven Decision-Making and Scenario-Planning 

Forecasting, scenario planning, and even the usage of AI to envision the future and support decision-making are strong indicators of an advanced strategy planning process, along with the usage of technology to track strategy execution.

3. Integration With Other Key Processes in the Organization 

The strategy planning process must inform and align with the budgeting exercise, operational business planning, and setting individual KPIs. In the case of mature organizations, these processes are not synchronized just from the annual calendar perspective, but in the sense of coherent decisions, and lead to synergies.

4. The Ability to Simultaneously Manage Short-Term and Long-Term Goals 

This refers to being able to define, review, and reimagine the long-term future, without losing sight of it while you address short-term needs. 

5. Embracing Emergent Strategic Planning

Emergent planning is the ability to integrate unplanned ideas and opportunities into your deliberate strategy. It is about adapting your objectives and initiatives according to new insights.

6. High Strategy Awareness 

Once approved, the strategy is effectively communicated to all layers of the organization and constantly reinforced by updating everyone on progress, changes, and achievements. Organizations use town hall meetings, strategy awareness sessions for smaller groups, individual talks, monthly internal newsletters, videos, posters, etc.

7. Strong Leadership Commitment 

Leadership plays a crucial role in driving strategy maturity. Committed leaders make a strong contribution during the planning sessions. They take ownership for achieving objectives and KPIs, and allocate the right resources for strategy execution.” 

Cristina’s insights show that while foundational practices are essential, reaching higher maturity requires a mindset shift—one that transforms strategy from a fixed series of plans to a continuous, adaptable process.

Performance Measurement: The Analytical Lens 

Where strategy sets the direction, measurement provides the compass. As organizations evolve, their approach to measurement becomes more intentional, more inclusive, and more data-informed. To learn more about this subject, we asked Doina Popovici, Head of Maturity Assessment Services, and Head of Certifications & Faculty Oversight at the GPA Unit. She ensures the effective implementation of assessment frameworks while upholding rigorous evaluation standards, bridging service excellence with faculty development. 

According to Doina, the clearest signals of readiness for a higher level can be seen in how organizations treat KPIs. These organizations see KPIs as more than mere metrics, but as tools for decision-making and continuous improvement.

“An organization’s readiness to progress in the maturity of its performance measurement capability is best demonstrated by a shift in how it approaches KPI management: from simply tracking performance to actively optimizing it. Instead of asking, ‘What should we measure?’, leadership begins to ask, ‘Are we measuring the right things, in the right way, and using the right insights to drive improvement?’ Organizations at higher maturity levels embrace a systematic and inclusive approach to performance measurement.”

This shift is pivotal, and it begins with the way KPIs are selected, defined, and managed.

“At lower maturity levels, organizations may select KPIs in an ad-hoc manner, often dictated by leadership without structured methodologies or stakeholder input. In contrast, as maturity increases, KPI selection is driven by formalized techniques, stakeholder consultations, and relevance assessments, ensuring that chosen KPIs are meaningful, aligned with strategic objectives, and adaptable to internal and external changes.

Beyond selection, mature organizations document KPIs using a standardized template before implementation, ensuring clarity in definitions, formulas, data sources, and calculation methodologies. KPI documentation is maintained in a digital, centralized database, ensuring easy access and real-time updates. Rather than being a one-time effort, it is a dynamic and continuously evolving resource, adapting to changes in strategy, operational processes, and market conditions. 

When it comes to KPI target setting, organizations at lower maturity levels often rely on managerial experience and subjective judgment. However, mature organizations adopt a formalized, data-driven approach, utilizing techniques such as benchmarking, historical trend analysis, and forecasting. Targets are set through collaborative processes that involve key stakeholders, ensuring alignment across teams and enhancing commitment to performance outcomes.”

Once this foundation is in place, maturity shows up in how measurement is applied. Measurement evolves from a process to a system: real-time, automated, well-visualized, and governed by clear roles and standards.

“A key milestone in performance measurement maturity is the transition from manual data collection to automated systems. Lower-maturity organizations struggle with fragmented, labor-intensive data collection methods, increasing the risk of errors and inefficiencies. In contrast, advanced organizations invest in automated data collection and integration across systems, enabling real-time performance tracking and minimizing human bias and inaccuracies.

Mature organizations also prioritize effective data visualization to ensure performance insights are easily interpretable. Instead of generating generic reports, they apply best-practice visualization principles, such as ensuring clarity, using the right chart types for different data sets, avoiding information overload, and maintaining consistency in design. Dashboards are customized for different audiences, ensuring that executives, managers, and employees receive the insights most relevant to their roles.

Finally, an organization’s performance measurement capability reaches higher maturity when it develops a robust governance structure. This involves defining clear roles and responsibilities, such as KPI owners, data custodians, and performance managers, who oversee the implementation, monitoring, and refinement of KPIs. A well-defined governance framework ensures that performance measurement is embedded within organizational processes, that KPI-related policies are established and regularly updated, and that all stakeholders receive continuous learning opportunities to enhance their capability in managing performance data.”

But even the best-designed measurement systems rely on people to bring them to life. This is reflected in how they engage with goals, respond to feedback, and turn data into daily action.

Performance Improvement: The Transformation Lens

As performance is measured, gaps are identified and opportunities for improvement are revealed. This is the catalyst for transformation. To understand this process, we reached out to Mohamed Elmasry, a GPA Unit Accredited Assessor and Associate Management Consultant at The KPI Institute. 

Mohamed has firsthand experience in helping organizations take their performance measurement process to the next level. According to him, a sure sign of an organization’s performance improvement maturity is the presence of robust data analytics. Data-driven decision-making is crucial for performance improvement as it facilitates accurate reporting and structured performance reviews.

“When organizations transition to higher levels of maturity in performance management, the shift is evident in their holistic approach to continuous improvement. Rather than sporadic interventions, performance improvement becomes an integral, proactive discipline seamlessly embedded within the organization's operations, strategic planning, and daily decision-making.

A foundational sign of advancing maturity can be observed through enhanced data analysis capabilities. Organizations moving beyond basic maturity levels shift from retrospective data review towards proactive analysis using sophisticated tools such as predictive analytics, enterprise resource planning (ERP) solutions, and business intelligence (BI) platforms. This advanced analytical capacity allows organizations to identify emerging trends, forecast potential issues, and proactively adjust strategies, significantly reducing reactive problem-solving and enhancing operational agility.

Closely tied to data analysis is the transformation in reporting practices. Mature organizations evolve their reporting from simplistic summaries to comprehensive, strategically informative documents. Performance reports adopt a storytelling approach, integrating visual analytics with contextual insights and actionable recommendations. Rigorous quality-assurance measures ensure accuracy and reliability, empowering stakeholders at all levels with trusted, timely insights that directly inform strategic and operational decision-making.

The evolution of performance review meetings further underscores this maturity. These meetings transition from informal, retrospective updates into structured forums essential for strategic alignment and action. Mature performance review sessions follow clearly defined agendas, involve all related stakeholders, and rigorously document decisions, assigning explicit ownership, deadlines, and follow-up checkpoints. This structured discipline fosters accountability, ensures alignment with strategic goals, and enhances organizational responsiveness.

What other signs of performance improvement should we look out for? Mohamed says it’s how structured and formalized the organization’s systems are. Moreover, there should be a focus on learning, from which all improvement stems. Governance is also a good sign of maturity as it establishes role clarity and fosters accountability.

Another critical area reflecting increased maturity is initiative management. Initially, improvement initiatives often lack standardized documentation, clear ownership, and alignment with organizational objectives. In contrast, organizations achieving higher maturity implement structured initiative management practices, adopting standardized documentation templates detailing objectives, timelines, risks, and milestones. Initiatives are systematically consolidated into centralized digital portfolios, providing clear visibility into progress and strategic alignment, significantly improving coordination, execution, and impact measurement.

The maturity journey also includes systematic investment in learning and improvement mechanisms. Organizations advance by embedding practices such as lessons learned logs and changelogs to systematically capture, analyze, and disseminate knowledge gained from previous performance cycles. Structured innovation frameworks are established to encourage continuous improvement, actively sourcing and evaluating ideas from internal teams and external stakeholders. These practices ensure continuous learning, reduce recurring errors, and embed a sustainable culture of proactive improvement.

Lastly, the maturity shift is solidified through robust performance system governance. Clearly defined governance frameworks articulate roles, responsibilities, and accountability mechanisms within comprehensive performance improvement manuals. Communication plans that detail the frequency, channels, and content of performance-related information ensure consistent transparency with internal and external stakeholders. Regular training and capacity-building programs reinforce governance effectiveness, ensuring all the teams across the entire organization are equipped and motivated to sustain continuous improvement.”

Performance Culture: The Behavioral Lens 

To understand how performance culture evolves as organizations move up the maturity ladder, we turn to Teodora Gorski, Head of Partnerships and Growth at the Global Performance Audit Unit (GPA Unit). With over a decade of experience in designing and implementing performance management systems globally, Teodora focuses on the deep-rooted behavioral shifts that signal when performance grows from simply being managed to being lived.

In organizations at lower levels of maturity, performance culture is often rule-bound. There’s a formal system, but engagement is limited, feedback feels forced, and recognition is transactional. According to Teodora, the real transformation begins when performance moves beyond structured cycles and becomes part of how people think, act, and collaborate every day.

“An organization is ready to advance in performance culture maturity when performance stops being something managed and starts being something that naturally happens—through the way people think, act, and collaborate.”

So, what are the signs that an organization is stepping into a higher maturity level? Teodora shares five cultural markers that reveal when performance excellence is becoming embedded:

“1. Performance becomes a ripple effect, not a checklist, 

In mature organizations, high performance isn’t driven by policies or checklists; it’s contagious. People see excellence in action, adopt it, and amplify it. Feedback, improvement, and ownership are part of the daily rhythm rather than scheduled events.

2. The culture welcomes discomfort. 

Strong performance cultures aren’t built on agreement. Instead, they’re built on challenge. In mature organizations, people don’t avoid tough conversations; they expect them. Disagreements refine ideas, not egos. The best cultures prioritize learning over certainty and push past comfort zones.

3. The right metrics drive behaviour, not just reports. 

Numbers exist to create action, not just to be reviewed. Instead of obsessing over outputs, mature organizations track decision speed, collaboration strength, and the ability to turn insights into results. Performance becomes about what moves the business forward.

4. People wear the mission, not just the job title. 

Employees embody the company’s purpose. They don’t need corporate slogans to tell them what matters; they live it. Performance and identity become inseparable.

5. Recognition is a habit, not a formality. 

Great work is recognized in the moment. Influence isn’t tied to job titles but to who actually moves the needle. It’s a meritocracy, where high performers rise based on impact rather than hierarchy or politics.”

Employee Performance Management: The Enabling Lens

Last but not least, employee performance management is the fifth capability of the Integrated Perofrmance Management Maturity Model developed by GPA Unit, and thus, crucial to assess when it comes to growth in maturity. Muhammad Ali Moustafa, Management Consultant at The KPI Institute, describes the evolution of employee performance management maturity from low to high levels, as follows:

An organization’s readiness to advance in EPM maturity is best reflected in a shift in its fundamental approach to performance management. Instead of asking, “How do we track employee performance?”, leadership begins to ask, “How do we enable it?” This change in perspective signals that performance management is no longer seen as just an HR process but as a strategic enabler of both business success and employee growth.

One of the clearest signs of readiness is when performance ownership moves beyond HR and becomes embedded in how the organization operates. At lower maturity levels, HR is responsible for driving performance processes, ensuring compliance, and keeping managers on track. But as maturity increases, managers take the lead in performance conversations, using them as tools for alignment, coaching, and continuous improvement. Employees, in turn, stop seeing performance management as a passive exercise and begin actively shaping their own development, seeking feedback, and adjusting their goals dynamically.

Another key indicator is the organization’s ability to evaluate performance beyond just output. Lower maturity levels often focus narrowly on what employees did—measuring success in tasks completed or KPIs met. At higher levels, however, performance is assessed holistically, incorporating competencies, skills, and behaviors that contribute to long-term success. Who an employee is—how they collaborate, problem-solve, and lead—becomes just as important as what they achieve.

Ultimately, an organization is ready to transition when performance management is no longer about compliance but about creating an environment where employees are empowered to succeed, learn, and contribute to a shared purpose.

Recognizing the Shifts

You can tell an organization is maturing when performance no longer needs to be pushed. Strategy shifts from being a document to a way of thinking. Measurement moves from reporting to insight. Culture stops relying on process and starts living in behavior. These are real signals—ones you can see in the way teams align, improve, and stay accountable without being told.

These transitions don't occur in isolation. They are interdependent and collectively contribute to a holistic enhancement of organizational performance. Recognizing these signs is crucial for leaders aiming to foster a resilient and high-performing organization. By embracing these changes, organizations position themselves to adapt to evolving challenges and proactively shape their future success.

Special thanks to Cristina Mihăiloaie, Doina Popovici, Teodora Gorski, Mohamed Elmasry, and  Muhammad Ali Moustafa for sharing their perspectives. Their observations remind us that the signs of progress are there—you just have to know where to look.