Developing an Artificial Intelligence Capability: A Theoretical Framework for Business Value

Abstract

Despite the claim that Artificial Intelligence (AI) can revolutionize the way private and public organizations do business, to date organizations still face a number of obstacles in leveraging such technologies and realizing performance gains. Past studies in other novel information technologies argue that organizations must develop a capability of effectively orchestrating and deploying necessary complementary resources. We contend that if organizations aim to realize any substantial performance gains from their AI investments, they must develop and promote an AI Capability. This paper theoretically develops the concept of an AI capability and presents the main dimensions that comprise it. To do so, we ground this concept in the resource-based view of the firm and by surveying the latest literature on AI, we identify the constituent components that jointly comprise it.