Influence of artificial intelligence (AI) on firm performance: the business value of AI-based transformation projects

2020 ◽  
Vol 26 (7) ◽  
pp. 1893-1924 ◽  
Author(s):  
Serge-Lopez Wamba-Taguimdje ◽  
Samuel Fosso Wamba ◽  
Jean Robert Kala Kamdjoug ◽  
Chris Emmanuel Tchatchouang Wanko
Keyword(s):  
Artificial Intelligence ◽  
Firm Performance ◽  
Case Studies ◽  
Research Question ◽  
Business Value ◽  
Organizational Level ◽  
Content Type ◽  
Industrial Sectors ◽  
Wide Range ◽  
The Impact

PurposeThe main purpose of our study is to analyze the influence of Artificial Intelligence (AI) on firm performance, notably by building on the business value of AI-based transformation projects. This study was conducted using a four-step sequential approach: (1) analysis of AI and AI concepts/technologies; (2) in-depth exploration of case studies from a great number of industrial sectors; (3) data collection from the databases (websites) of AI-based solution providers; and (4) a review of AI literature to identify their impact on the performance of organizations while highlighting the business value of AI-enabled projects transformation within organizations.Design/methodology/approachThis study has called on the theory of IT capabilities to seize the influence of AI business value on firm performance (at the organizational and process levels). The research process (responding to the research question, making discussions, interpretations and comparisons, and formulating recommendations) was based on a review of 500 case studies from IBM, AWS, Cloudera, Nvidia, Conversica, Universal Robots websites, etc. Studying the influence of AI on the performance of organizations, and more specifically, of the business value of such organizations’ AI-enabled transformation projects, required us to make an archival data analysis following the three steps, namely the conceptual phase, the refinement and development phase, and the assessment phase.FindingsAI covers a wide range of technologies, including machine translation, chatbots and self-learning algorithms, all of which can allow individuals to better understand their environment and act accordingly. Organizations have been adopting AI technological innovations with a view to adapting to or disrupting their ecosystem while developing and optimizing their strategic and competitive advantages. AI fully expresses its potential through its ability to optimize existing processes and improve automation, information and transformation effects, but also to detect, predict and interact with humans. Thus, the results of our study have highlighted such AI benefits in organizations, and more specifically, its ability to improve on performance at both the organizational (financial, marketing and administrative) and process levels. By building on these AI attributes, organizations can, therefore, enhance the business value of their transformed projects. The same results also showed that organizations achieve performance through AI capabilities only when they use their features/technologies to reconfigure their processes.Research limitations/implicationsAI obviously influences the way businesses are done today. Therefore, practitioners and researchers need to consider AI as a valuable support or even a pilot for a new business model. For the purpose of our study, we adopted a research framework geared toward a more inclusive and comprehensive approach so as to better account for the intangible benefits of AI within organizations. In terms of interest, this study nurtures a scientific interest, which aims at proposing a model for analyzing the influence of AI on the performance of organizations, and at the same time, filling the associated gap in the literature. As for the managerial interest, our study aims to provide managers with elements to be reconfigured or added in order to take advantage of the full benefits of AI, and therefore improve organizations’ performance, the profitability of their investments in AI transformation projects, and some competitive advantage. This study also allows managers to consider AI not as a single technology but as a set/combination of several different configurations of IT in the various company’s business areas because multiple key elements must be brought together to ensure the success of AI: data, talent mix, domain knowledge, key decisions, external partnerships and scalable infrastructure.Originality/valueThis article analyses case studies on the reuse of secondary data from AI deployment reports in organizations. The transformation of projects based on the use of AI focuses mainly on business process innovations and indirectly on those occurring at the organizational level. Thus, 500 case studies are being examined to provide significant and tangible evidence about the business value of AI-based projects and the impact of AI on firm performance. More specifically, this article, through these case studies, exposes the influence of AI at both the organizational and process performance levels, while considering it not as a single technology but as a set/combination of the several different configurations of IT in various industries.

Does R&D create additional business value through IT?

2017 ◽  
Vol 11 (2) ◽  
pp. 194-208 ◽  
Author(s):  
Yu Wang ◽  
Tie-nan Wang ◽  
Xin Li
Keyword(s):  
Firm Performance ◽  
Fixed Effects ◽  
Business Value ◽  
It Investment ◽  
Content Type ◽  
Chinese Business ◽  
Fixed Effects Regression ◽  
The Impact ◽  
D Investment ◽  
It Payoff

Purpose R&D indicates absorptive capacity, which may affect IT payoff. The purpose of this paper is to examine how R&D investment affects the relation between IT investment and firm performance and under what circumstances R&D intensity is more beneficial to IT returns. Such study has been lacking in R&D research and IT payoff literature. Design/methodology/approach A conceptual model for linking IT investment, R&D investment, environmental dynamism and firm performance was developed and tested by data collected from Chinese listed firms from 2007 to 2013, using fixed effects regression model. Findings The results show positive moderating effects of firm R&D investment and government R&D subsidies on the relation between IT investment and firm performance. Furthermore, the impact of firm R&D investment on IT payoff is stronger for firms in more dynamic environments. The findings suggest that R&D investment creates additional business value through interactions with IT, and complementarities between R&D and IT, as manifested in their interaction effect on firm performance vary across industry sectors. Research limitations/implications This paper indicates the importance of complementarities between R&D and IT, which should prove helpful to researchers and practitioners engaged in Chinese business. Originality/value This paper presents one of the first attempts at examining the moderating effect of R&D investment on the relation between IT investment and firm performance. Especially this study helps to understand under what circumstances R&D investment is more or less likely to be beneficial to IT returns.

Is business performance linked to organizational culture? A study from Tunisian SMEs through subjective measures

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Salim Morched ◽  
Anis Jarboui
Keyword(s):  
Organizational Culture ◽  
Firm Performance ◽  
Employee Engagement ◽  
National Culture ◽  
Energy State ◽  
Organizational Level ◽  
Validity And Reliability ◽  
Content Type ◽  
Job Attitude ◽  
The Impact

Purpose Every independent organization would sincerely like to have competent, loyal and engaged people, as engaged persons are typically those who have significant attachment and active involvement in their organization. Without engaging people, high quality and productivity will not be achieved. The purpose of this study is to explore the impact of organizational culture derived from Tunisian customs of firm performance. Tunisian subcultures may not be represented in the national culture. Design/methodology/approach This study carefully examines the impact of organizational culture on firm performance of Tunisian small and medium-sized enterprises. Results from 100 organizations and companies were collected using questionnaires for data collection analysis from employees occupying various positions in different hierarchical levels. Statistics used are tested by ordinary least squared regression. Furthermore, response bias, validity and reliability were the most important points examined by researchers. Findings These results reveal and confirm that the charisma that has been perceived by employees as energy state has an impact on the performance of the organization, regardless of the moderating effect of the uncertainty of the environment. Moreover, this study also showed that organizational culture has a significant effect on firm performance as well as on the interpretation of the organization, which depends on charisma. Originality/value The implication is that even in a country with many subcultures, excellent management still needs to pay attention to the impact of national culture at the organizational level on job attitude, work ethics and employee engagement, which are however, very limited. It is expected that this finding can contribute to the organization in that management becomes aware of the personality of the employees during their recruitments, especially the chief characteristic of being energetic. Managers need to create a conductive and rewarding environment for individuals to contribute positively.

Developing “Extra Distance” as a measure for the evaluation of road freight transport performance

2014 ◽  
Vol 63 (7) ◽  
pp. 822-840 ◽  
Author(s):  
Vasco Sanchez Rodrigues ◽  
John Cowburn ◽  
Andrew Potter ◽  
Mohamed Naim ◽  
Anthony Whiteing
Keyword(s):  
Case Studies ◽  
Distance Measure ◽  
Distribution Networks ◽  
Freight Transport ◽  
Performance Measure ◽  
Primary Case ◽  
Content Type ◽  
Industrial Sectors ◽  
Road Freight ◽  
The Impact

Purpose – The purpose of this paper is to develop a measure that links the causes and consequences of disruptions in freight transport operations. Such a measure is needed to quantify the scale of impact and identify the root causes of disruptions. Design/methodology/approach – In order to develop this measure, an inductive approach was adopted, using four primary case studies to test the measure in an industrial environment. The case studies are from the fast moving consumer goods sector with primary and secondary distribution networks included. The “Extra Distance” measure has been evaluated against established generic criteria that define the quality of any performance measure. Findings – The research indicates good compliance with the criteria used to evaluate the “Extra Distance” measure. The measure is also found to be useful for practitioners who are able to directly relate the measure to their distribution network operations. Research limitations/implications – Further research should see the “Extra Distance” measure further tested in other freight transport operations and industrial sectors. Practical implications – The measure is directly related to a number of causes of uncertainty which helps freight transport managers to quickly identify potential solutions. The “Extra Distance” measure can be used to quantify the effects of disruptions which can occur in road freight transport networks generate unnecessary cost within distribution networks, potentially eroding profit margins which are known to be very low in the road freight transport industry. Originality/value – This paper presents a novel approach to the assessment of the impact caused by uncertainty within freight transport operations.

scholarly journals A framework for understanding managerial responses to supply chain complexity

2018 ◽  
Vol 38 (6) ◽  
pp. 1433-1466 ◽  
Author(s):  
Neil Turner ◽  
James Aitken ◽  
Cecil Bozarth
Keyword(s):  
Supply Chain ◽  
Business Strategy ◽  
Current Knowledge ◽  
Research Question ◽  
Study Data ◽  
Content Type ◽  
Response Options ◽  
Wide Range ◽  
Descriptive Framework ◽  
The Impact

PurposeThe purpose of this paper is to examine the nature of supply chain complexity and extend this with literature developed within the project domain. The authors use the lens of ambidexterity (the ability both to exploit and explore) to analyse responses to complexity, since this enables the authors to understand the application of known solutions in conjunction with innovative ones to resolve difficulties. This research also seeks to investigate how managers respond to supply chain complexities that can either be operationally deleterious or strategically beneficial.Design/methodology/approachThe authors develop a descriptive framework based on the project management (PM) literature to understand response options to complexity, and then use interviews with supply chain managers in six organisations to examine the utility of this framework in practice. The authors ask the research question “How do managers in supply chains respond to complexities”?FindingsThe case study data show first that managers faced with structural, socio-political, or emergent supply chain complexities use a wide range of responses. Second, over a third of the instances of complexity coded were actually accommodated, rather than reduced, by the study firms, suggesting that adapting to supply chain complexity in certain instances may be strategically appropriate. Third, the lens of ambidexterity allows a more explicit assessment of whether existing PM solutions can be considered or if novel methods are required to address supply chain complexities.Practical implicationsThe descriptive framework can aid managers in conceptualising and addressing supply chain complexity. Through exploiting current knowledge, managers can lessen the impact of complexity while exploring other innovative approaches to solve new problems and challenges that evolve from complexity growth driven by business strategy.Originality/valueThis study addresses a gap in the literature through the development of a framework which provides a structure on ways to address supply chain complexity. The authors evaluate an existing project complexity concept and demonstrate that it is both applicable and valuable in non-project, ongoing operations. The authors then extend it using the lens of ambidexterity, and develop a framework that can support practitioners in analysing and addressing both strategically necessary supply complexities, together with unwanted, negative complexities within the organisation and across the supply chain.

Using cognitive analytics technology to enhance performance

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Keyword(s):  
Case Studies ◽  
Significant Influence ◽  
Design Methodology ◽  
Reading Time ◽  
Dynamic Capabilities ◽  
Business Value ◽  
Content Type ◽  
Pertinent Information ◽  
The Impact ◽  
Practical Implications

Purpose This paper aims to review the latest management developments across the globe and pinpoint practical implications from cutting-edge research and case studies. Design/methodology/approach This briefing is prepared by an independent writer who adds their own impartial comments and places the articles in context. Findings Many organizations fail to enhance business value through the use of cognitive analytics (CA). The impact of the technology on performance can be optimized via the significant influence of CA on the firm’s dynamic capabilities of sensing, seizing and reconfiguring. Originality/value The briefing saves busy executives and researchers hours of reading time by selecting only the very best, most pertinent information and presenting it in a condensed and easy-to-digest format.

The impact of strong and balanced organizational cultures on firm performance

2018 ◽  
Vol 10 (1) ◽  
pp. 16-35 ◽  
Author(s):  
Panagiotis Polychroniou ◽  
Panagiotis Trivellas
Keyword(s):  
Firm Performance ◽  
Business Environment ◽  
Negative Influence ◽  
Organizational Level ◽  
Sustainable Competitive Advantage ◽  
Competing Values ◽  
Content Type ◽  
Culture Strength ◽  
Innovation Competence ◽  
The Impact

Purpose This study aims to investigate the relationship between organizational culture and performance. It concerns the aspects of culture related to culture strength and unbalance and its impact on introvert and extrovert firm performance, controlling for business environment and size. Design/methodology/approach Based on the competing values model (CVM), culture strength is measured as the intensity of the culture values driving the company. The cultural unbalance is measured by the sum of absolute deviations of organizational members’ culture perceptions across the four archetypes (adhocracy, clan, hierarchy and market) imposed by CVM from the individual “average” shared cultural value. Evidence is drawn upon a sample of 1,305 employees of 114 Greek firms. Findings The findings indicate a strong positive relationship between culture strength and internal performance (innovation competence and human relations) as well as firm outcomes (profitability, growth and reputational assets). On the contrary, culture unbalance exerts a negative influence to market position, growth and innovation competence. Practical implications Understanding the nature of the association between culture strength, unbalance and firm performance would enable academics and practitioners to reflect critically on the core culture values which shape employee involvement and formulate leaders’ quality improvement decisions and actions, so as to achieve sustainable competitive advantage at the organizational level. Originality/value This research provides supporting empirical evidence for the culture–performance link by identifying the principle culture value characteristics (strength and unbalance), which exert both direct and interaction effects on the introvert and extrovert aspects of firm performance.

scholarly journals Calculative regimes in the making: implementation and consequences in the context of Austrian public universities

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Michael Habersam ◽  
Martin Piber ◽  
Matti Skoog
Keyword(s):  
Case Studies ◽  
Public Universities ◽  
Research Question ◽  
Qualitative Interviews ◽  
Unintended Consequences ◽  
Organizational Level ◽  
Research Approach ◽  
Longitudinal Case Study ◽  
Content Type ◽  
Field Level

Purpose This study aims to answer the research question of how a calculative regime for public universities is implemented, how and under which conditions its symbolic use emerges and what kind of unintended consequences occur over time. Design/methodology/approach The empirical material presented in the paper derives methodically from a longitudinal qualitative research approach analyzing higher education systems (HES)-reforms in Austria. To better understand the consequences of the organizational changes in line with the new legal framework, 2 series of qualitative interviews in 2011/2012 and 2016/2017 on the field level and the organizational level were conducted. Findings Identifying two enabling consequences from the tactical behaviors of resistance and symbolic use, i.e. new processes of communication and horizontal network building, allows for theory-building with a focus on the dynamics how accounting begins, then next becomes an established infrastructure, is then destabilized and re-elaborated before it becomes, again, an infrastructure which is different from before. Research limitations/implications Although the findings are based on a national empirical context, they are linked to the international discourse on HES in transition and the role of calculative regimes including performance measurement and management attitudes and instruments. They are relevant for an international research community open-minded toward differentiated case studies in a longitudinal perspective on HES-reforms. Practical implications When reflecting on their own specific settings governing bodies and practitioners managing the transition of HES may find insights from longitudinal case studies inspiring. The dynamics initiated by new calculative regimes installed need a sensitive framework to handle dissent, resistance, tactical behaviors and changes in power relations between the field level and the organizational level. Originality/value This is a unique longitudinal case study of the Austrian HES and its public universities in transition.

Business strategy, performance appraisal and organizational results

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Alberto Bayo-Moriones ◽  
Jose Enrique Galdon-Sanchez ◽  
Sara Martinez-de-Morentin
Keyword(s):  
Firm Performance ◽  
Human Resources ◽  
Performance Appraisal ◽  
Competitive Strategy ◽  
Management Practices ◽  
Robust Regression ◽  
Innovation Strategy ◽  
Content Type ◽  
The Impact ◽  
Developmental Performance

PurposeThe purpose of this study is to analyze how the design of performance appraisal is influenced by the competitive strategy of the firm. Then, this paper examines if the alignment between appraisal and strategy impacts firm performance.Design/methodology/approachThe study sample includes 258 Spanish firms in the manufacturing and services sectors. This information was gathered through questionnaires addressed to the CEO and the senior human resources manager. Several econometric models are estimated, using robust regression analysis and including a set of relevant control variables.FindingsA positive relationship is found between an innovation strategy and developmental performance appraisal. A cost strategy has a negative impact on the adoption of developmental performance appraisal. The findings also confirm that firms with a quality strategy and developmental appraisal have higher performance. In addition, firms adopting an innovation strategy and administrative appraisal enjoy higher return of equity.Research limitations/implicationsFuture research should analyze the dynamics of the relationships between appraisal, strategy and performance to rule out the flaws of cross-sectional data. Another potential extension is the analysis of the interactions of the design of other human resources management practices with both competitive strategy and firm performance.Practical implicationsFirms can improve performance by aligning performance appraisal design with strategy. Those with an innovation strategy should choose administrative appraisal, and those competing on quality should focus on developmental appraisal.Originality/valueThis paper compares the theoretical recommendations on performance appraisal for different competitive strategies, what firms actually do, and the impact that the alignment between appraisal and strategy has on firm performance.

Market orientation, innovation commercialization capability and firm performance relationships: the moderating role of supply chain influence

2017 ◽  
Vol 32 (7) ◽  
pp. 913-924 ◽  
Author(s):  
Jeen-Su Lim ◽  
William K. Darley ◽  
David Marion
Keyword(s):  
Supply Chain ◽  
Firm Performance ◽  
Market Orientation ◽  
Innovation Management ◽  
Strategy Formulation ◽  
Content Type ◽  
Positive Effects ◽  
The Impact ◽  
Moderating Role

Purpose The study aims to explore supply chain influence (SCI) on the linkages among market orientation, innovation capabilities and firm performance (FP), using the resource-based view as a theoretical backdrop. Design Survey data from 182 top managers who are involved in strategy formulation and innovative direction of their companies was collected and analyzed using moderated multiple regression analysis. Findings Results revealed a moderating role of the SCI in that the proactive market orientation (PMO) and FP relationship is stronger when SCI is high, and innovation commercialization capability (ICC) and FP relationship is stronger when SCI is low. Practical implications Firms pursuing high PMO strategy must collaborate with supply chain function to achieve the full effect of PMO. Additionally, as supply chain is critical to meeting customers’ needs, these firms should allow supply chain to exert greater influence to enjoy the positive effects of PMO in addition to ensuring full integration into marketing strategy implementation. Also, firms with high ICC need to limit SCI to maximize the benefit of ICC on FP, just as innovation management needs to be cognizant of other functional areas. Originality/value The study investigates the potential moderating role of SCI on the relationships among market orientation, ICC and FP. The study fills a gap in the understanding of the nature and role of supply chain in the marketing–supply chain interaction, and the impact on FP.

The impact of intellectual capital on firm performance: a study of Indian firms listed in COSPI

2018 ◽  
Vol 19 (5) ◽  
pp. 935-964 ◽  
Author(s):  
Neha Smriti ◽  
Niladri Das
Keyword(s):  
Firm Performance ◽  
Intellectual Capital ◽  
Value Creation ◽  
Generalized Method Of Moments ◽  
Value Added ◽  
Secondary Data ◽  
Share Price ◽  
Content Type ◽  
Listed Firms ◽  
The Impact

Purpose The purpose of this paper is to examine the effect of intellectual capital (IC) on financial performance (FP) for Indian companies listed on the Centre for Monitoring Indian Economy Overall Share Price Index (COSPI). Design/methodology/approach Hypotheses were developed according to theories and literature review. Secondary data were collected from Indian companies listed on the COSPI between 2001 and 2016, and the value-added intellectual coefficient (VAIC) of Pulic (2000) was used to measure IC and its components. A dynamic system generalized method of moments (SGMM) estimator was employed to identify the variables that significantly contribute to firm performance. Findings Indian listed firms appear to be performing well and efficiently utilizing their IC. Overall, human capital had a major impact on firm productivity during the study period. Furthermore, the empirical analysis showed that structural capital efficiency and capital employed efficiency were equally important contributors to firm’s sales growth and market value. The growing importance of the contribution of IC to value creation was consistently reflected in the FP of these Indian companies. Practical implications This study has robust theoretical grounds and employs a validated methodology. The present study extends knowledge of IC among academicians and managers and highlights its contribution to value creation. The findings may help stakeholders and policymakers in developing countries properly reallocate intellectual resources. Originality/value This study is the first study to evaluate IC and its relationship with traditional measures of firm performance among Indian listed firms using dynamic SGMM and VAIC models.

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