Performance management does not just take place during the annual review or every few months. Instead, it is a continuous process. It can also be displayed as a cycle with four stages: planning, monitoring, reviewing and rewarding. The first stage, planning, involves setting the employee and team goals together. In the second stage, progress is monitored and obstacles removed. In the third stage, employee results are evaluated and a performance evaluation is conducted. The final stage of the cycle includes recognizing and possibly rewarding achievements. This reward could be anything from a bonus to more vacation days.