Abstract

This study analyzes the suitability and relevance of implementing Armstrong's (2000) organizational performance theory in the context of Indonesian organizations in 2025. Armstrong developed a strategic, sustainable, dialogue-based performance management model that is integrated with all human resource management practices. However, when this framework is adopted in the Indonesian context, both in the private and public sectors, there are various inconsistencies due to differences in organizational culture, bureaucratic structure, industrial relations, and employment regulations such as Law No. 13/2003 and Law No. 6/2023. The analysis shows that Indonesian organizations still face challenges in the form of an administrative understanding of performance management, minimal continuous feedback practices, weak links between performance appraisal results and reward systems, and the dominance of a paternalistic and hierarchical work culture. Comparison with Indonesian performance theories (Mangkunegara, Wibowo, Hasibuan, Rivai) reveals that Armstrong's model does not fully encompass micro variables such as motivation, work discipline, compensation, and leadership, which are actually very important determinants of performance in the national context. This study concludes that Armstrong's (2000) theory is compatible as a strategic framework, but requires contextual adaptation through the addition of local variables for effective application in Indonesia.

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