A system and method for efficient management of operating modes within an integrated circuit (IC) for optimal power and performance targets. A semiconductor chip includes processing units each of which operates with respective operating parameters. Temperature sensors are included to measure a temperature of the one or more processing units during operation. A power manager determines a calculated power value independent of thermal conditions and current draw. The power manager reads each of a first thermal design power (TDP) value for the processing units and a second TDP value for a platform housing the semiconductor chip. The power manager determines a ratio of the first TDP value to the second TDP value. Additionally, the power manager determines another ratio of the first TDP value to the calculated power value. Using the measured temperature, the ratios and the calculated power value, the power manager determines a manner to adjust the operating parameters.