In the background of knowledge economy, the national innovation ability directly determines the country's level of economic development, industrial structure transformation. Colleges and universities reflect directly the national innovation ability level, and they are one of the main research subjects of the national innovation capacity, so they largely determine the level of national innovation level. At present, the creative ability levels vary, and the methods for assessing the performance of team innovation has not met the unified requirements, while the assessment is mainly based on the level of the academic leaders, the number of the backbone of scientific research, number and grade of application for scientific research and the innovation ability of universities will be promoted simply by increasing the amount of investment research and the high level of recruiting innovative talents, ignoring promotion of the innovation environment, innovation climate, innovation communication, and failure to make targeted enhancement according to the characteristics of creative teams and the creative team environment.In this paper, the evaluation system of innovation ability of colleges and universities are taken as the research objects, and throughreferring to the literature related to the characteristic of university innovation team and management methods at home and abroad, analyzing the applicability of the analysis method, and selecting the PDCA method as the method of theoretical analysis, this paper analyzes the existing problems of university innovation performance appraisal management in combination with the PDCA method, and perfects the research on the innovation performance appraisal of university evaluation and the PDCA circulation theory. It also finds out the main factors influencing the lifting capability of team innovation by applying the PDCA circulation method, analyzes the reason of their coming into being, and puts forward the main measures to enhance the innovation capability.This paper conducts an empirical research on the innovation performance appraisal management of a university team in Beijing, evaluates the scientific research innovation performance of the colleges and universities by means of PDCA circulation, finds out the main problems of the University Innovation Team existed, makes a further analysis by using the analysis method of causality diagram, finds out the main reason for the existence of innovation team performance and proposes targeted improvement measures. For the more prominent problem,a second PDCA circulation is made for analyzing the problem, finding out the main reasons for its existence, and putting forward the measures of improvement. The comprehensive evaluation method is used to evaluate the innovation ability level before and after the application of PDCA circulation method, and the evaluation results show that the innovation ability is improved obviously by using the PDCA circulation method, and it is helpful to enhance the university innovation capability levelby using the PDCA circulation method.Finally, this paper puts forward the suggestions and measures to enhance innovation capability of the university team. According to the analysis of the literature and practice, the paper puts forward four measures for improvement of the innovation ability of colleges and universities, namely the innovation topic selection, training of talents, team building and environment construction. In summary, this paper provides a new method of university innovation performance appraisal management, and demonstrates the validity of the method through the empirical analysis. Because of the different emphasis in innovation, some problems exist in the appraisal by using this method, therefore, a large number of empirical analysis is needed to carry on a quantitative analysis, so as to find out the problems existed in the application of the method in similar problems. This is the deficiency of this paper.