How leaders can use AI to improve performance management

Performance management is a process that many employers, managers, and leaders dread, and according to Gartner research, 71% of CHROs agree that managers are not fulfilling their role in this area. As a result, employees are not receiving the feedback they need to perform well. This can have a ripple effect on organizational success, with only 52% of employees believing that performance management is helping their organization achieve its business goals. One of the main reasons for this is the perception of bias or lack of fairness in the process. Interestingly, employees are starting to view AI as less biased than humans when it comes to performance decisions. In fact, 87% of employees think that algorithms could give fairer feedback than their managers. To improve performance management, CHROs need to evaluate the benefits of generative AI (GenAI) against performance management pain points, gauge readiness for GenAI in their organization, and secure employee trust to boost adoption and satisfaction. By integrating GenAI, organizations can increase fairness, efficiency, and employee satisfaction. Effective performance management leads to better organizational performance, with increases in employee performance, engagement, and overall workforce performance. With employees open to the idea of GenAI in performance management, now may be the ideal time to integrate this technology.