Impact of artificial intelligence assimilation on firm performance: The mediating effects of organizational agility and customer agility

Abstract

In the emerging literature on artificial intelligence (AI) and other disruptive technologies, the importance of technological assimilation has been recognized for high operational and strategic organizational benefits and economic growth. AI is considered as the next productivity frontier for its high capability to transform almost all aspects of intra-and-inter-organizational operations across the industry. Yet, the literature lacks empirical studies on how AI assimilation could lead to improved organizational outcomes such as organizational agility, customer agility and firm performance. This study is an initial attempt to fill this research gap. It draws on the dynamic capability view and the available studies on AI to investigate the impacts of AI assimilation (AIASS) on firm performance (FPERF). Then, it assesses the mediating effects of organizational agility (ORGAG) and customer agility (CUSTAG) on the relationship between the AIASS and FPERF. This study uses an online survey-based approach to collect data from 205 supply chain executives in the USA to test the proposed research model. The findings confirm that AIASS is an important predictor of FPERF, CUSTAG, and ORGAG, with stronger effects on ORGAG. Moreover, ORGAG is an important predictor of CUSTAG and FPERF, with stronger effects on CUSTAG. Furthermore, CUSTAG and ORGAG were found to be complementary partial mediators of the relationship between AIASS and FPERF. These results are discussed, with implications for research and practice. Some limitations to the study are presented, which opens up future research perspectives.