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Performance management takes into account the activities that promote organizational goals in business. They ensure consistency in all levels of efficiency and effectiveness. Performance management from the start focused on the general performance of an organization even up to modern times. These levels of performance could be an employee, a department or even the processes and procedures used in manufacturing. With developments and sophistication of business, the feasibility of a business engagement needed close monitoring and evaluation (Wade and Ronald, 2001). Performance management thus made it possible to assess the efficiency and the effectiveness of doing business.
Performance management is a broad term that emerged in the late 20th century. This wide term was coined by Aubrey Daniels towards the end of 1970. Aubrey came up with performance management to define a science that was imbedded in methods of applications for managing both the behavioral patterns and the results of a business process. These elements were very critical and are even used up to date to determine performance, an element that is important to the present and the future of any profitable activity. This was mainly before the information age in the second half of the 20th century (Cokins, 2009). The collection of data from sources that were not automated proved to be difficult for businesses. There were no computing resources for proper data analysis. Therefore, intuition was the only way commercial decisions were made. This was most likely to produce a lot of errors.
With automation, a lot of data was made available even though collection was still a challenge. In 1989, Howard Dresner popularized business intelligence (BI) which was meant to improve decision making in business (Dresner, 2007). Thus, the foundation of performance management is built on BI although it is intertwined in the control and planning cycle of an organization providing capabilities of planning, consolidation and lastly modeling.