Virtually every company has implemented a Business Performance Measurement System (BPMS) with the purpose of monitoring production and business performance and to execute the corporate strategy at all levels in a company. The purpose of this article is to shed light on common pitfalls related to the practical use of BPMS and further to present a life cycle model with the purpose of introducing structured approach to avoiding the pitfalls. The article contributes to further development of the BPMS life cycle concept and practical examples of how it can be used.