Does Artificial Intelligence Influence the Operational Performance of Companies? A Study

Abstract

Business in today's world of Technological era is obviously influenced by the Artificial Intelligence (AI). AI needs to be considered as a significant element in the business development and growth. The study allows to consider AI as the digital technology that must be brought together to facilitate enhanced performance of business organizations. The study aims at a pilot study to assess the influence of AI on the operating performance of the companies and thereby fills the gap in the existing literature. This paper aims at establishing the relationship and exploring the influence of artificial Intelligence on operational performance of companies in different sectors in India. An attempt has been made to assess the difference in operational performance in pre and post AI era. In the study, the artificial Intelligence is measured by the variables such as computer hardware and intangibles (computer software etc.). The operating profit and operating cost have been taken as the proxy variables for operational performance of companies. The study was based on secondary data which has been collected from annual reports of sample companies. The sample companies under study comprise of manufacturing, telecommunication, and IT companies for the time period from the year 2004 to 2018. The statistical software i.e., Ms. Excel and EViews 10 have been used to run the t-test and panel regression model for statistical inferences. The study found that artificial Intelligence has a significant influence on companies operating cost as well as operating profit.