Healthcare professionals are increasingly held accountable for the standards of care that they provide. The focus of control for this accountability can be either internal or external activity to the professional body and can use implicit or explicit quality assessment techniques. The science of performance measurement and performance management of professional activity is a new and rapidly expanding one. Advocates of an actively managed approach to quality improvement often underestimate the tensions associated with promoting change amongst traditionally autonomous professionals who work in complex organisations. This tension has tended to result in polarised opinions about complex issues rather than legitimate debate.There is considerable uncertainty about the most effective ways of measuring professional performance and the relationship between measurement and quality improvement. This article examines some of the important issues in measuring clinical performance and using such measures to manage healthcare activity and promote quality improvement. This article is intended to shed light on the rapidly changing, data-rich environment within which healthcare systems now operate, and it highlights a number of questions that need to be addressed before the full potential of performance management in healthcare can be realised.