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Performance management is critical to the performance of individuals and organizations. We conduct a longitudinal study on a listed enterprise (i.e. Neusoft) in China as basis in first identifying the four stages of its growth process: initial start-up, growth, mature, and sustainable development stages. The evolution path of performance management system (PMS) in Neusoft can be described as ‘point’, ‘line’, ‘surface’, and strategic ‘surface’ evaluation systems in the initial start-up, growth, mature, and sustainable development stages, respectively. We find that the critical influencing factors of PMS include the good professional background and personal traits of line managers, clear communication on performance management goals between leaders and their subordinates, professional knowledge of performance management specialists, and broad participation of senior leaders in performance management processes. The four factors emerge gradually with the evolution of PMS. This paper contributes to building a comprehensive and dynamic construct for PMS and generates a systematic understanding of the critical influencing factors of this system.

Evolution path and critical influencing factors of performance management system: a longitudinal case study in China