Abstract

Artificial intelligence (AI) and other advanced technologies are increasingly recognized as essential catalysts for enhancing productivity due to their capability to transform nearly all operations within and outside firms. However, the empirical research on how AI assimilation may promote firm-level outcomes such as absorptive capacity (AC), customer agility (CA), and firm performance (FP) is still in its infancy. Drawing from the dynamic capability view and using 417 valid responses collected through cross-sectional methods from small and medium-sized enterprises (SMEs) in Lebanon, this study examines the effect of AI assimilation on firm performance. The mediating roles of AC and CA were investigated. The moderating role of organizational agility (OA) was also explored. The findings support the hypothesized assumptions that continual advancement of technology evolves the industrial organizations’ performance with CA and AC as parallel mediators, partially mediating the link between AI assimilation and FP and OA as a moderator, moderating the positive relationship between AI and CA and between AI and FP. The findings provide crucial insights for practitioners and advance the dynamic capability view framework. They provide compelling evidence that enriches the understanding of AI assimilation, demonstrating its positive impact on critical organizational outcomes and yielding performance benefits for SMEs.

Introduction

The modern era requires modern solutions, and existing businesses are deploying technologies to meet customers’ expectations [1]. Customers want quick responses, which necessitates the use of fast-moving systems and responsiveness. From this standpoint, firms are introducing AI technologies to establish a CA system that can quickly respond to an ever-changing business environment. Through such technologies, firms can improve problem-solving abilities, boost productivity and efficiency in customer service and other fields [2], and improve their performance and productivity [[3], [4], [5], [6], [7], [8], [9]].

The use of AI technology to assist organizations in attaining and maintaining a competitive edge relies on the complete assimilation of such technology throughout business processes [10]. This is due to IT assimilation’s crucial role in enabling end-to-end business operations to develop and maintain business value [10,11]. Existing literature has acknowledged that it can be counted on to enhance organizational performance [12] and foster supply chain agility and business value [13]. However, most of the existing literature focuses on only two facets of assimilation: the crucial factors of assimilation [10,14] and IT-based outcomes [10,15].

Conclusion, limitations, and future research

۶٫۱٫ Conclusion
This article contributes to emerging studies on AI at the organization level by examining the effect of AI assimilation on FP, which so far has received limited attention, particularly in the context of developing economies, which remains under-researched, calling into question the generalizability of the findings and theories in this research area. Our study is an initial effort to address this issue. This study also offers insights into the mediating role of CA and AC on the link between AI assimilation and FP. We found that OA moderates the link between AI assimilation and CA and AI assimilation and FP in the SME context.

۶٫۲٫ Limitations and directions for future research
This article has some limitations that future studies should take note of. First, the sample obtained is limited to SMEs in Lebanon because of cultural and technological disparities between nations; the conclusion of the present research may not be generalizable to other nations. Hence, future research should collect data from multi-cultural nations to boost the generalizability of the findings. Second, a complimentary qualitative or longitudinal study that gives more information about the causal relationship between AI assimilation and FP via CA could enhance our understanding of the topic. Third, several contextual constructs, such as uncertainty, structure, and culture, could exist between AI assimilation and FP and moderate this relationship. Finally, research regarding AI technologies in obtaining business value is still very scarce in developing economies; more empirical studies are required to broaden our understanding.