Vol. 7, Issue 2, Part J (2025)

Performance management has an integral role in the success of an organisation since it influences productivity, employee engagement and strategic alignment. The advancement in artificial intelligence (AI) has led to organisations exploring its integration in the performance management of their business. There are significant opportunities presented with the integration of AI in performance management such as better decision making, increased fairness and continuous improvement. However, there are still certain challenges that need to be addressed for capitalising on the benefits of the technology. Challenges related to ethics, legal compliance and data quality must be navigated carefully to leverage AI for transforming the performance management within the organisation. This paper has explored the opportunities and challenges involved with the integration of AI in performance management within an organisation.