College of Business

Doctor of Business Administration Program

Fall Semester AY2023-2024

Term A

Research Title:

Understanding Leadership Styles Effectiveness through Adoption and

Implementation of Artificial Intelligence.

Students Names
Student ID No.
Course Code and Title MGMT3- Leadership
Course Instructor Dr. Marwan Al Qur’an
Assignment Submission 17.09.2023
Assignment Type& First Draft Submission
Tools
 Table of Contents
Abstract..............................................................................................................................3

Introduction........................................................................................................................4

Review of Literature..........................................................................................................7

Artificial Intelligence.......................................................................................................7
Leadership........................................................................................................................8
Leadership and AI Initiatives...........................................................................................9

Analysis (Solution)...........................................................................................................14

References.........................................................................................................................17

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 Abstract

In the ongoing industrial revolution, where humanity is challenged by machines,

leadership skills become paramount. To succeed in this environment, leaders must establish a
culture of leadership, complete with a robust organizational system, and exert their influence
through effective leadership practices.

Despite the manifold advantages offered by artificial intelligence (AI), concerns loom
large among many individuals who fear job displacement due to automation. Therefore, it is
imperative to comprehend the impact of leadership on the adoption and implementation of AI by
identifying the key leadership styles conducive to its success. Significantly, the research
contributes to identifying the leadership style that is positively correlated with the adoption and
effective implementation of AI within organizations.

The study shows that transformational, participative, and ethical leadership styles are
better equipped to navigate the challenges and opportunities presented by AI. An adaptive
leadership approach displaying qualities of both transformational and transactional paradigms, in
addition to balancing task and relations orientations, appears optimally positioned for managing
AI transformations responsibly and achieving intended strategic outcomes.

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 Introduction

Artificial intelligence (AI) is a highly sophisticated technology designed to replicate

human intelligence and is at the forefront of what has been referred to as the "fourth industrial

revolution" (Glikson & Woolley, 2020). This revolution represents a significant shift in the

balance of control from humans to technology, fundamentally altering our understanding of

human-technology interactions (Murray et al., 2021). Over the past decade, AI has made

exponential progress thanks to increased computational power and the availability of extensive

data. AI encompasses a wide range of applications, from domain-specific tools to general

machine learning models, all contributing to unprecedented advancements across various

industries.

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 Global investments in AI are set to exceed $110 billion by 2024 (International Data

Corporation, 2021), indicating the rapid adoption of these transformative technologies. However,

from a managerial perspective, AI presents a double-edged sword for employees, who are the

most immediate stakeholders in the AI-enabled workplace (Frey & Osborne, 2017). On the one

hand, AI can streamline work processes and boost employee efficiency. On the other hand, it

may evoke fears of job displacement and psychological stress among workers (Zhu et al., 2022).

The truth is that AI will reshape workplace productivity rather than replace it entirely.

To successfully navigate this transformation, organizations must recognize that technical

implementation alone is insufficient. Effective leadership is essential to guide cultural and

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process changes and maximize the strategic value of AI initiatives (Hidayatno et al., 2019). As

AI adoption in the workplace triggers varying reactions and perceptions among employees, these

attitudes can significantly impact service performance levels. In the context of this ongoing

technological transformation, visionary leadership and effective leadership qualities are critical

in achieving desired outcomes (Peifer et al., 2022).

Therefore, leaders must adapt their leadership styles and philosophies to align with the

challenges posed by AI and organizational transformation. Existing leadership theories provide

conceptual frameworks for how leaders motivate followers to accomplish organizational goals

(Hajiali et al., 2022; Haq et al., 2022; Madi Odeh et al., 2023). However, as disruptive digital

technologies continue reshaping business paradigms, further examination of leadership best

practices tailored for technology-driven transformations can offer valuable insights. The

objective of this paper is to conduct an in-depth review of current scholarly literature analyzing

predominant leadership styles in the context of AI adoption for enhanced understanding. It aims

to identify leadership approaches most conducive to fostering responsible implementation

through a comparative evaluation based on the empirical studies discussed. The paper concludes

by outlining the scope for future research directions.

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 Review of Literature

The notion that rising digitization will call for a new set of leadership skills has started to

gain prominence in recent years (Watson et al., 2021). Therefore, this study's overarching

purpose is to learn how different types of leadership influence the use of AI in organizations. In

their article, Davenport and Kirby (2016) argued that intelligent machines should be considered

as partners and collaborators rather than as automators of human tasks. Many individuals worry

about being replaced by robots because of the threat that automation poses to their jobs. This is

why Davenport and Kirby (2016) emphasized the need of emphasizing augmentation rather than

automation when trying to persuade people that intelligent technologies are employed to aid in

human performance. In reality, collaborations between humans and smart robots will provide

workers with a fantastic chance to boost their output and salary. As a result, the study’s focus on

employee attitude outcomes is a crucial aspect of the study model for elucidating the connection

between management and Artificial Intelligence.

Artificial Intelligence

The field of Artificial Intelligence (AI) research, as well as the term itself, lacks a

consistent definition, making it currently impossible to provide a clear definition. This lack of

clarity is due to the various influences of the technology (Peifer et al., 2022). AI encompasses

elements from both engineering and cognitive science, which is evident in its broad range of

applications.

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 According to research published by the McKinsey Global Institute (2018), AI has seen

rapid development in recent years, causing significant shifts in the workplace. Improvements in

AI-based technology bring both benefits and difficulties for today's public and commercial

institutions. McKinsey (2018) predicts that the fast advancement of technology will have far-

reaching social and economic consequences. Therefore, organizational performance can be

enhanced by adopting AI, which will eventually make a positive contribution to the global

economy (Manyika et al., 2017).

Leadership

One of the most cited contemporary theories differentiates the transformational and

transactional leadership paradigms originally posited by Bass and Riggio (2006).

Transformational leaders motivate followers through inspiration, intellectual stimulation, and

individualized consideration to achieve ambitious yet attainable goals through collaborative

efforts. In contrast, transactional leaders focus on contingent reward systems emphasizing pre-set

targets and corrective actions for lapses through management-by-exception.

Further work has expanded upon the complementary dimensions of task-oriented versus

relations-oriented leadership espoused by Cooke and Rousseau (1988). Whereas task orientation

stresses clear objective-setting and deadline-driven efforts, relations orientation aims to build an

understanding of the environment by engaging stakeholders through open communication of

perspectives. For initiatives like technological transformations demanding extensive process

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overhaul alongside cultural changes, research suggests an approach balancing both aspects may

yield optimal outcomes (Gilley et al., 2009).

Recent studies have also started examining leadership models specifically suited for

innovative technologies. Given disruptive innovations' potential for intended progress as well as

unintended consequences, scholars emphasize guiding their development through principles of

responsible research and governance (Jobin et al., 2019). For instance, Li et al. (2023) propose a

human-centered leadership paradigm of care, wisdom, and compassion prioritizing trust-

building, ethics, and minimizing societal harms from AI alongside technical accomplishments.

Leadership and AI Initiatives

The rise of new technologies, including artificial intelligence (AI) technologies like smart

autonomous systems, analytics, and big data, among others, has been accelerated by the

affordability of digital infrastructures like computers, mobile devices, internet connections, and

storage. The management of organizations, the way people work, and the structure of entire

industries have all changed as a result of these technologies (Rajan & Dhir, 2021). As a

consequence of this, the requirement that future managers have a solid understanding of

information technologies necessitated modifying the business education curriculum (Frey &

Osborne, 2017).

A crucial element of digital business transformation, organizational culture has a big

impact on the entire transformation process and how successful it is in the end (Munir et al.,

2022). Building a strong organizational culture in the context of the digital economy requires the

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creation of core values and business practices that are firmly centered on quick adaptation to

necessary changes and resilient resistance to environmental disruptions (Hooi & Chan, 2022). As

a result, a company's ability to successfully navigate complex problems and changes in the

business landscape depends on leadership that supports artificial intelligence (Odugbesan et al.,

2023).

Companies who see the benefits of using cutting-edge digital technology and solutions

and are prepared to do so effectively stand to earn a significant competitive advantage. The

crucial question now is how quickly and successfully they can undertake digital business

transformation while assuring the existence of suitably skilled staff (Rožman et al., 2023). It is

no longer a question of whether organizations should invest in digitization and innovation.

Businesses will have a significant competitive advantage if they have adopted new, cutting-edge

digital technology and solutions and recognize their advantages. There is no longer a debate over

whether or not businesses should spend money on innovation and digitization. In order to enable

their staff to work creatively and swiftly solve problems, businesses must broadly embrace

training and education programs in the field of artificial intelligence (Kambur & Akar, 2022).

The establishment of such an environment hinges on the engagement of colleagues who

collectively embody the characteristics of this particular organizational culture through their

individual actions. Companies are expected to face major obstacles in their pursuit of business

transformation within the context of the digital business landscape in the absence of such

interaction (Wijayati et al., 2022).

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 The readiness of an organization for change is the first sign of AI's adoption because it is

a technological innovation. The business that implements AI gains authority (Li et al., 2023).

However, the underlying complexity of it and the need for organizational change present

difficulties for organizations that adopt it. The necessary condition to carry out a particular action

is referred to as organizational readiness. Therefore, "the preparedness of organizations to

implement change involving applications and technology related to AI" is the definition of AI

readiness. Digital readiness is determined by an organization's readiness to undergo digital

transformation. Up until now, managing organizational transition toward increased digitalization

has been the responsibility of organizational leaders. It has primarily affected lower to mid-level

personnel, but it increasingly appears that top management echelons are also facing pressure

(Quaquebeke & Gerpott, 2023).

AI belongs to the digital technologies category (Kalimeri & Tjostheim, 2020). Like other

computerized advances, a few elements can demonstrate that the organization is prepared for

man-made intelligence reception. Strategic alignment, resources, knowledge, culture, and data

are the five categories that are used to group these factors together. Data quality, change

management, upskilling, AI ethics, AI awareness, and so on are some of these factors (Kalimeri

& Tjostheim, 2020). Before an organization can take on computer-based intelligence innovation,

it necessitates surveying every one of the variables. Because AI is a technological innovation, as

previously stated, an organization that adopts it will continually undergo digital transformation.

Therefore, enhancing the influencing factors is also a component of developing digital

organizational readiness. An organization that adopts AI technologies without being prepared

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runs the risk of failing. When compared to other digital technologies, AI's characteristics, such as

its inherent complexity, make its adoption more challenging (Li et al., 2023).

The company that implements AI technology faces a number of managerial difficulties

that have a strategic impact on the organization. AI is multifunctional, like other digital

technologies. The process of adoption and the necessary transformation are led by leaders.

Leaders, like all other employees, need to be well-versed in the most recent AI technologies,

including their potential and limitations (Kalimeri & Tjostheim, 2020). As previously mentioned,

they suggest complexity, which can also make it difficult to comprehend. An organization's

adoption and implementation of AI may be hampered by a lack of fundamental skills and

knowledge about AI in general. In addition, if managers do not comprehend it, the overall

objectives of the organization will not be attained. Other researchers also state that education is

one solution to this problem. By looking at the places where AI technologies have been

implemented, people can learn about the capabilities of AI technologies by looking around them.

Understanding its capabilities can assist in achieving desired outcomes (Kalimeri & Tjostheim,

2020). However, self-education regarding AI can be challenging due to its complexity and

difficulty in understanding in comparison to other technologies (Smith & Green, 2018). As a

result, changing the business education curriculum can help the next generation of digital

leaders. featured that business understudies should be shown about IT so they can become

successful administrators and pioneers from here on out. Additionally, the company must devise

an effective AI-effects strategy in order to address managerial issues.

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 Extant literature offers valuable insights into leading organizational AI initiatives

responsibly and effectively. Smith and Green (2018) argue the need for leaders to articulate

strategic vision, actively engage stakeholders, and steer hands-on implementation ensuring

standards-alignment. Rajan and Dhir (2021) conceptualize an adaptive leadership approach,

balancing transformational and transactional behaviors with both task and relations orientations.

They posit top leadership, collaborative culture-building, and emphasis on organizational

learning as enabling factors for successful, responsible transformation.

Thus, the adoption of AI technologies is subject to the vision and direction set by

organizational leaders. Transformational leadership, characterized by visionary and inspirational

leaders, has been linked to a greater willingness to adopt AI (Davenport & Kirby, 2016). These

leaders tend to embrace innovation and convey a sense of purpose that encourages their teams to

embrace AI as a means of achieving strategic goals. In contrast, transactional leaders, who rely

on rewards and punishments, may encounter resistance to AI adoption due to a lack of intrinsic

motivation (Newstead et al., 2023).

Fries et al. (2021) have argued that one of the significant cornerstones of successful AI

implementation is innovation. Leaders with a participative or democratic leadership style, who

involve employees in decision-making processes, tend to create an environment conducive to

innovation (Fries et al., 2021). Such leaders encourage collaboration, diversity of thought, and

experimentation, which are vital for leveraging AI's potential. On the other hand, autocratic

leaders may stifle innovation by imposing rigid structures and limiting employees' creative input.

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 Similarly, Kalimeri and Tjostheim (2020) posit that AI adoption presents unique

challenges, including concerns about job displacement, data privacy, and ethics. Ethical

leadership, characterized by a commitment to fairness and responsibility, can help organizations

navigate these challenges (Kalimeri & Tjostheim, 2020). Ethical leaders prioritize transparency,

data ethics, and responsible AI deployment, earning trust from employees and stakeholders.

Conversely, leaders who overlook ethical considerations may face backlash and resistance from

employees and the public.

Analysis (Solution)

To maximize the effectiveness of AI adoption and implementation, organizations must

consider leadership style as a critical factor. We propose an analytical framework that integrates

leadership styles and AI adoption and implementation, enabling organizations to make informed

decisions.

Based on a review and synthesis of current debates, certain leadership styles appear better

equipped than others for harnessing transformational technologies like AI. Alone, a purely

transactional paradigm focused solely on short-term goals and contingent rewards is likely

inadequate given the complex, long-term nature of sophisticated AI projects extending beyond

predefined milestones. A compelling inspirational vision articulated through transformational

leadership may better catalyze teams through challenges inherent in disruptive technologies.

Specifically, transformational, participative, and ethical leadership styles appear to be

particularly well-suited to navigate the challenges and opportunities presented by AI. By

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recognizing the importance of leadership in the AI journey, organizations can make strategic

decisions, foster innovation, and ensure responsible AI integration, ultimately leading to a

competitive edge in the evolving digital landscape.

However, hands-on monitoring of technical, social, and ethical performance against

strategic commitments through transactional oversight also remains important, considering AI's

complexity with opportunities for unintended outcomes. A task-oriented focus on goal-setting

and resource optimization facilitates efficient AI development. Concurrently, a relations-oriented

mindset promoting understanding among users, developers, and other stakeholders supports

organizational learning critical to extract value from AI responsibly over the long-run.

Overall, an adaptive leadership approach displaying qualities of both transformational

and transactional paradigms, in addition to balancing task and relations orientations, appears

optimally positioned for managing AI transformations responsibly and achieving intended

strategic outcomes. Such leaders envision ambitious responsible futures, empower distributed

teams through inspiration, closely track multiple dimensions of progress, and cultivate learning

cultures where failures inform continuous improvement.

Conclusion and Future Directions

To summarize, the current study implies certain leadership styles combining visionary

inspiration with hands-on guidance may most effectively facilitate technology-driven

transformations. For responsible AI adoption, in particular, leaders embracing collaborative

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learning through an adaptive approach integrating varied perspectives appear best equipped. A

comprehensive conceptual model outlining leadership competencies for optimally leading at

each stage of AI maturity remains an avenue for further theoretical refinement.

In addition, conducting comparative case studies longitudinally measuring the effects of

leadership approaches on AI project outcomes, value realization, capability development, and

cultural evolution could offer meaningful implications for practitioners navigating disruptive

change. As AI increasingly transforms enterprises globally, emphasizing leadership best

practices that respect socio-technical dynamics can help optimize outcomes from this general-

purpose technology for inclusive societal progress.

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