The way organizations operate is being transformed by artificial intelligence (AI). It is transforming the structures, decision-making and value creation of companies. One of the most significant advantages of AI is enhanced efficiency and innovation, although the technology also has issues to do with ethics, governance, and change management. It is essential to know the advantages and obstacles to effective use of AI and technology. This paper will discuss the opportunities and challenges of applying AI and related technologies to transform organizations. We have examined research articles published in the last five years (2019-2026) in large academic databases, including Scopus and Web of Science. These results show that there are a number of challenges in transforming with AI: low quality of data, lack of skills among workers, worker resistance and difficulty in adapting, ethical issues, transparency problems, and effective leadership are required. Meanwhile, AI opens valuable prospects: enhanced processes, more informed decisions made with data, enhanced learning, increased innovation, and higher stakeholder value. The review is especially applicable to entrepreneurial firms, SMEs, and organizations in emerging economies aiming to apply AI to innovate, gain competitive advantage, and create sustainable values.