A system includes a power generation system and a controller that controls the power generation system. The controller includes a processor that generates a model of the power generation system that estimates a value for a first parameter of the power generation system. The processor also receives a measured value of the first parameter. The processor further adjusts a correction factor of the model such that the estimated value of the first parameter output by the model is approximately equal to the measured value of the first parameter. The processor also generates a transfer function that represents the correction factor as a function of a second parameter of the power generation system. The processor further displays the transfer function along with one or more previously generated transfer functions to quantify degradation of the power generation system.