Artificial intelligence: a strategy to harness its power through organizational learning

Abstract

Purpose

The purpose of this paper is to present a framework that captures the strategic value of artificial intelligence (AI) systems. Although AI has become a crucial component of digital transformation efforts tied to organizational strategy, many firms struggle to derive strategic value from emerging AI systems.

Design/methodology/approach

The analytical framework in this paper is based on a learning-centered approach. Specifically, by building on the knowledge-based perspective, this paper elaborates on how AI can contribute to organizational learning to create a competitive advantage in knowledge-intensive contexts.

Findings

This paper argues that the power of AI as a strategic resource lies in its self-learning capacities. Such learning capacities are only realized in partnership with humans through mutual learning. This paper formulates the concept of artificial capital and the ways artificial and human capital can together drive routinization and strategic learning processes that connect internal and external environments of the organization.

Originality/value

This is a timely contribution as many organizations are considering adopting AI technologies for strategic purposes. This paper translates the proposed framework into several practical implications for managing and developing AI to meet strategic business goals.

Citation

Jarrahi, M.H., Kenyon, S., Brown, A., Donahue, C. and Wicher, C. (2023), "Artificial intelligence: a strategy to harness its power through organizational learning", Journal of Business Strategy, Vol. 44 No. 3, pp. 126-135. https://doi.org/10.1108/JBS-11-2021-0182