Dynamic power management has become an essential part of multi-core processors and associated systems. Dedicated controllers with embedded power management firmware are now an integral part of design in such multi-core server systems. Devising a robust power management policy that meets system-intended functionality across a diverse range of workloads remains a key challenge. One of the primary issues of concern in architecting a power management policy is that of performance degradation beyond a specified limit. A secondary issue is that of negative power savings. Guarding against such “holes” in the management policy is crucial in order to ensure successful deployment and use in real customer environments. It is also important to focus on developing new models and addressing the limitations of current modeling infrastructure, in analyzing alternate management policies during the design of modern multi-core systems. In this concept paper, we highlight the above specific challenges that are faced today by the server chip and system design industry in the area of power management.