Performance management as a process raises several issues related to its effectiveness and contribution to organizational performance. Particularly, in context of software services industry difficulties inherent in managing employee performance seem to grow. This article discusses the research conducted in software services industry with the purpose of understanding industry context and its relationship with performance management. Results of this study indicate that software service sector was unique with respect to its nature, that is, knowledge intensive and dynamic, resulting in far greater complexity for performance management. The nature of this industry rendered uniqueness to individual performance context and underscored the role of line managers in performance management. The article also sheds light on issues regarding expatriate performance management, competency assessment and expectations of software professionals from the performance management system. Findings of this study have implications for facilitating greater alignment between software service industry context and performance management in the achievement of organizational objectives and goals.
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