What do we mean by performance in organisations?

Working with organisations across different industries and countries, there is one word that consistently generates the same misunderstanding: performance.

At Parmonia Consultores, we have spent years stopping conversations to clarify what we actually mean by this term — whether working with clients on transformations or with other companies, and even professionals sharing experiences and lessons learned. This article is that explanation.

The most common misunderstanding

Our background started in human resources, moved through business process management, and today we dedicate ourselves almost exclusively to organisational transformation. Because of that trajectory, people often assume we are talking about performance in the HR sense — appraisals, feedback cycles, engagement surveys, and so on.

That is when we stop the conversation and say "No". That is one piece of it, and it is a piece that HR or whoever owns people practices within the enterprise should enable and support. It is not where we operate.

So, what is performance?

When we talk about performance — when we intervene and co-design it — we are referring to individual and organisational performance and its impact at the team, personal, and business level. Performance is integrated with the business, executed by individuals and teams, and built every single day, which means it changes, evolves, and is constantly being shaped. It encompasses dimensions of behaviours, ways of thinking, emotions, leadership, and relationships.

It is a system, not a process. As such, it belongs to the organisation as a whole — not to any one department, and certainly not to HR.

Performance is what an organisation builds, destroys, or ignores every day — whether it chooses to see it or not.

The three dimensions of performance

Understanding performance deeply means looking at it across three simultaneous dimensions, none of which have anything to do with an HR process.

Individual performance

It is about how each person feels contributing — or not — to the organisation at any given moment. Whether they are adding value at every step, whether what they do feels connected to something larger. No annual review captures that.

Team performance

It is about building and sustaining high-performance teams grounded in trust, ethics, and transparency — whether within a single function or across the organisation. Trust is built, earned, or broken through everyday practice. It is not something you write into a list of company values.

Organisational performance

It reflects how the institution stands in relation to its community and stakeholders: the quality of its relationships, its image and reputation, and its health — financial, mental, physical, and social.

An organisation can have strong numbers and still be sick. And a sick organisation, sooner or later, shows it in its results.

What we see in organisations

We have seen this play out repeatedly. Well-designed transformation initiatives — with methodology, executive sponsors, and top-tier consulting firms — that produced no meaningful results six months in. Not because the strategy was wrong. But because no one had looked at the gap between the numbers and the reality of how people were actually working every day.

Most organisations know where they stand in terms of results. Far fewer know why they are there. No one had paid attention to how people were processing the change: what they were prioritising, how they were leading, what conversations were not happening. And even fewer had asked who or what needed to shift for things to be different. That gap is exactly where performance lives.

Whose responsibility is it?

Performance is a system — it cannot sit with one department, it has no single owner.

It rests with those who lead the organisation, those who execute, and those mandated to create the conditions for all of it to work — and with the collective capacity to see it, name it, and work it.

In the middle of constant change, the first step is to stop and look honestly at where the organisation stands today — no projections, no wishful thinking, just the here and now. From there, understand what has clear ownership and what accountability has not yet been assigned. And finally, see how both of those things together are shaping day-to-day reality and what the organisation needs to achieve, transform, and evolve.

The how, the what, and the why

When we work through this with teams and leaders, we always come back to the same structure of three questions:

The How - the tools to measure it are the easiest to identify: OKRs, KPIs, North Star, and so on.

The What - the simpler things that actually make up performance are the hardest to identify and make visible: trust, transparency, risk, and so on.

The Why - going several steps further back to validate the what, is even more complex: honour the past and connect it directly with today's purpose.

An open question

Every organisation we work with teaches us something new about this — and every experience leads us back to the same question: how is your organisation building performance today?

We would love to hear what you are seeing from your own contexts, what resonates, and what you would add from your own experience.

#performance #peopleandculture #transformation #leadership #organisationalexcellence