INTEGRATING ARTIFICIAL INTELLIGENCE INTO STRATEGIC DECISION-MAKING: IMPLICATIONS FOR ORGANIZATIONAL AGILITY AND INNOVATION

Abstract

Objective: The study aimed to examine the role of AI integration in strategic decision-making, evaluate its impact on organizational agility, identify barriers to implementation, and provide actionable recommendations to enhance agility and innovation.

Methodology: A mixed-methods design was employed involving 120 professionals from multiple industries. Quantitative data were collected via structured online questionnaires assessing AI integration and organizational agility, and analyzed using independent samples t-tests and descriptive statistics. Qualitative data were derived from open-ended responses, coded inductively using NVivo 12 to identify themes regarding challenges and recommendations for AI adoption.

Results: Quantitative findings indicated that organizations with high AI integration demonstrated significantly higher organizational agility (M = 4.02, SD = 0.45) compared to those with low AI integration (M = 3.45, SD = 0.55), t(118) = 6.21, p < .001, with a large effect size (Cohen’s d = 1.13). Qualitative analysis revealed key barriers to AI adoption, including lack of skilled staff (65%), high implementation costs (50%), and data governance issues (45%). Recommendations emerged around six themes: leadership and strategic alignment, skills and training, data and infrastructure, change management and culture, cost/ROI considerations, and ethics/compliance.

Conclusion: AI integration significantly enhances organizational agility and fosters innovation, functioning as a strategic enabler of dynamic capabilities. Effective implementation requires overcoming barriers such as skills shortages, financial constraints, data quality issues, cultural resistance, and ethical or regulatory concerns. Executive leadership, strategic alignment, workforce development, robust data infrastructure, and ethical governance are critical to translating AI investments into measurable strategic outcomes.

Keywords:

Artificial intelligence, strategic decision-making, organizational agility, innovation, barriers, AI adoption, digital transformation