This paper deals with the question of how we can improve performance management systems in higher education institutions. Performance management systems are defined as configurations of complementary human resource management (HRM) practices that enable organizations to set goals, give feedback and evaluate the efforts of their employees. Higher education institutions have adopted performance management systems to manage their staff more efficiently and effectively against the backdrop of challenges like democratization, marketization and public accountability. However, in higher education institutions, such systems often result in unintended effects on academic employees’ well-being and performances. Like burnout, reduced innovation and lower team performances. This particularly applies to non-professorial higher education staff. In response, scholars have started to inquire into the ‘success conditions’, particular conditions under which the unintended effects of performance management systems can be avoided or reversed. Drawing on four empirical studies, this paper examined how and when performance management systems yield positive outcomes for the well-being and performance of academic employees in higher education institutions. The findings show that performance management systems have positive synergies with both employees’ well-being and performances (mutual gains). In addition, leaders are observed to be key supporters of performance management systems. However, they should not be regarded as a panacea, as our findings also seem to suggest a more complex interplay. Such findings contrast with the dysfunctional effects of performance management systems as described in higher education literature. However, it is important to remain critical. The main message is that academic employees’ personal perceptions of performance management implementation are a force to be reckoned with in striving for healthy and performant academic employees. Therefore, the subsequent challenge moves to managing those perceptions and building academic leaders.