How Do Organizational Factors Influence Performance through Performance Management System as Innovation?

[Purpose] This paper aims to provide a performance management system that can assist decision processes by advising decision－makers to make better decisions to promote mission success and impact others’ performance. This study explores the importance of the organizational factors of performance management system to their usage and organizational performance. [Methodology] We collected 58 responses from Korean public institution’s administrators by using fax and mailing with a cover letter. Dimension of measurements are decreased by factor analysis. To examine the relationship among organizational factors, performance management system, and performance, we used partial least square model. We confirmed the reliability and validity of the research model based on literature. [Findings] This study demonstrates that aligning strategy and organizational culture positively influence the uses of performance management system. Performance management system affects organizational performance by providing information or reward. The decision－ Facilitating role of PMS mediates the relationship between aligning strategy and organizational performance. [Policy Implications] In order to enhance the performance of public organizations, policymakers should be clearly aware of the purpose of the performance management system and increase the necessary organizational capabilities according to the purpose.