EFFECTIVENESS OF AI IN PERFORMANCE MANAGEMENT

Submitted by- Submitted to-Mr. Jahageer Ahmad

Navreet kaur
Samanpreet kaur
Muskan Kumari
Daler singh
 Table of Content
 Abstract
 Introduction
 Statement of the problem
 Need of the study
 Literature Review
 Objective
 Research Methodology
 References
 Abstract
This paper explores the impact of Artificial Intelligence (AI) on performance
management, highlighting the transformative potential of AI in revolutionizing
how organizations assess, develop, and incentivize their workforce. AI-
powered performance management systems can facilitate real-time feedback,
goal alignment, performance evaluation, and predictive analytics. The findings
of the study indicate that AI-driven predictive analytics can improve
performance forecasting, identify performance trends, and optimize resource
allocation for talent development initiatives. Moreover, AI can lead to greater
transparency, accountability, and effectiveness in driving employee
engagement, development, and organizational success. Overall, leveraging AI
in performance management can enable organizations to foster a culture of
continuous improvement, agility, and innovation.
 Introduction
Modern workplaces are changing dramatically due to technological
improvements, especially with the incorporation of Artificial Intelligence (AI)
into a range of organisational functions. Among them, performance
management is one area where AI is becoming a disruptive force that is
changing conventional wisdom. Using AI-powered systems in performance
management holds great promise for improving decision-making, developing
talent, and propelling organisational success as businesses aim for agility,
efficiency, and competitiveness in a quickly changing business environment.
The importance of information technology in rethinking work execution and
management techniques is emphasised by Vrontis et al. (2022). The
emergence of Artificial Intelligence (AI), which is defined by computers
executing cognitive tasks that were previously completed by humans
(Graßmann & Schermuly, 2021), has caused a revolution in the field of
Human Resource Management (HRM). Interestingly, there has been a
noticeable surge in the use of AI for commercial activities in recent years—
roughly a 70% rise in just the last five years alone (Chowdhury et al., in
press).
 AI in Performance management
Artificial Intelligence (AI) in performance management has become a
revolutionary endeavour in the modern organizational management environment,
transforming conventional techniques and improving decision-making processes.
Past studies by Grumman & Schermuly (2021), Biwa's (2021), Tong et al.
(2020), Vrontis et al. (2022), and Chowdhury et al. (in press) highlight the
critical role that AI will play in transforming performance management
approaches. The usefulness of AI in performance management is becoming more
apparent as businesses negotiate the challenges of the digital age, which is
marked by quick technical breakthroughs and changing labor relations.
Organizations may promote a culture of continuous improvement and learning
by using AI-powered technologies to personalise development efforts, expedite
performance evaluation procedures, and offer real-time feedback. The
incorporation of artificial intelligence (AI) into performance management
presents unparalleled prospects for enterprises to maximise talent development,
stimulate creativity, and accomplish strategic goals, ranging from augmenting
decision-making precision to propelling organisational nimbleness.
 Problem of the study
 Due to measurement of the performance there is lack of
transparency .
 Performance management is the time consuming process by the
human beings but if we are using AI technology then its save time
and provide accurate results.
 By the human beings it created human bias in the employees of
the organization but through AI technology its solved.
 It does not provide clear outcomes.
 Need of the study
 AI in performance management is significant for more accurate
assessment, real-time feedback, and personalized development
plans for employees.
 AI analyze vast amount of data to identify patterns and trends in
performance ,enabling organizations to make data-driven
decisions.
 It can also automate repetitive tasks, freeing up time for managers
to focus on strategic initiative and employee coaching.
 AI enhance efficiency, transparency, and fairness in performance
management processes.
 Literature Review

Artificial Intelligence (AI) has been increasingly prevalent in performance

management in recent years, changing conventional methods,creating new
options for businesses. The influence of artificial intelligence (AI) on human
resource management methods has been shown in research by Vrontis et al.
(2022), which emphasises how AI improves decision-making processes and
boosts organisational performance.
The relevance of AI in providing real-time feedback mechanisms within
organisations has been highlighted by a number of researchers (Vrontis et al.,
2022; Tong et al., 2020). Organisations may expedite employee feedback,
support continuous improvement projects, and streamline performance
evaluation procedures by utilising AI algorithms. Furthermore, the alignment
of personal ambitions with organisational goals is facilitated by AI-powered
solutions (Armstrong, 2016; Larson & Chu, 2018). Artificial intelligence (AI)
systems are able to analyse and comprehend goal statements by using machine
learning and natural language processing algorithms
Tong et al. (2020) explore the advantages and disadvantages of
artificial intelligence (AI) in performance management, talking about
how it may increase employee engagement, expedite procedures, and
promote a continuous improvement culture. The report emphasises
how crucial AI-driven insights are to reaching strategic goals and
improving people management procedures.
In his thorough analysis of the research on AI in performance
management, Biswas (2021) summarises the most important
conclusions and points out new developments. The study emphasises
the increasing use of AI-powered systems in businesses and the
necessity for more investigation into these systems' efficacy in various
settings.
Graßmann and Schermuly (2021) examine how AI is being used in
businesses, highlighting how crucial it is to combine machine and
human viewpoints for a successful rollout. The study explores how
employee acceptability, leadership support, and organisational culture
influence the uptake of AI-driven performance management systems.
 OBJECTIVES OF THE STUDTY

1. Evaluate the effectiveness of AI-powered performance management

systems in enabling real-time feedback, aligning goals, and conducting
performance evaluations within organizations.
2. Investigate the impact of AI-driven predictive analytics on improving
performance forecasting, identifying trends, and optimizing resource
allocation for talent development initiatives.
 Research methodology
Type of research
“Research design is the determination and statement of the general
research approach or Strategy adopted for the particular project.”
Following research designs have been used in this study:
Descriptive Research:
The research attempted to describe, explain, and understand current
situations. The goal was to look into a phenomena that was happening
at a given location and time. The research looked at the current
circumstances, practices, structures, differences, or linkages, as well as
views, ongoing processes, or emerging trends.
Sampling Design:
The study was based upon Probability sampling- RANDOM
SAMPLING.
Source of Data
Primary Data:
Data Collected is from the immediate employees of the organisation.
Information is collected through questionnaire filled through
employees of the organisation with a specific intention and on a
specific subject.
Designing of the Questionnaire:
Primary data was collected mainly through the help of survey
information (Questionnaire). A concise questionnaire was prepared
keeping in mind the information specification and the objective of the
report.
Data collection Tool / Instruments
The research instrument - Questionnaire

The respondents - Employees

Sample configuration - Sample size of the respondent

Methods of Data collection

The data collected is mainly through Quantitative method-
Questionnaire. However Qualitative methods has also been used for
having the wider perspective about the timings in the personal
Interviews.
 References
1. Thrassou, A., Vrontis, D., and Lamprianou, I. (2022). Artificial
intelligence and its effects on HRM procedures. 35(1), 88-106, Journal of
Organisational Change Management.
2. Schermuly, C. C., and Graßmann, C. (2021). Combining the views of
humans and machines to better understand how artificial intelligence is
being used in organisations. 451-473 in Journal of Applied Psychology,
106(3).
3. Liu, A., Chowdhury, S., & Kootbally, Z. (in press). A thorough analysis
of the trends and consequences surrounding the emergence of artificial
intelligence in HRM. doi: 10.1016/j.hrmr.2023.100932 Human Resource
Management Review
4. In 2020, Tong, Y., Liu, Y., and Sun, Y. Performance management using
artificial intelligence: Opportunities and problems. 31(10), 1305–1327,
International Journal of Human Resource Management.
5. Thurlow, A., and Helms Mills, J. (2010). Perceiving dimly through the glass?
Sensemaking and HRM system implementation. 131–156 in Human Relations,
63(1).

6. Shapiro, J., Harris, J., and Davenport, T. H. (2018). competing using analytics
for talent. 52–61 in Harvard Business Review, 96(5).

7. M. R. Brown (2019). Human Resource Management Review, 29(1), 86-98. AI-

driven performance management: Increasing the intelligence of performance
management.

8. S. Biswas (2021). A comprehensive survey of the literature on artificial

intelligence in performance management. 40(3), 245-268, Journal of Management
Development.

9. Smith, C. E., and A. S. DeNisi (2014). Review, model proposal, and new
directions for future research on performance management, performance
evaluation, and firm-level performance. Annals of the Academy of Management,
8(1), 127–179.
Thanks