Technovation 131 (2024) 102948

Contents lists available at ScienceDirect

Technovation
journal homepage: www.elsevier.com/locate/technovation

Decoding AI readiness: An in-depth analysis of key dimensions in

multinational corporations
Ali N. Tehrani a, Subhasis Ray b, Sanjit K. Roy c, Richard L. Gruner a, Francesco P. Appio d, *
a
Department of Marketing, The University of Western Australia, WA, Perth, Australia
b
Xavier Institute of Management, XIM University, India
c
School of Business & Law, Edith Cowan University, Perth, Australia
d
Paris School of Business, France

A R T I C L E I N F O A B S T R A C T

Keywords: Artificial Intelligence (AI) stands ready to impact all aspects of business, from optimizing operations to
Artificial intelligence personalizing services and enhancing customer value. However, many organizations grapple with implementing
AI readiness AI solutions due to a lack of necessary infrastructure and mechanisms. In short, many companies are not
Multinational corporations
adequately prepared to adopt AI. To make matters worse, the literature does not offer sufficient insights into this
AI adoption strategies
Work system framework
issue. To help address this issue, in this article, the authors explore what it means to become ‘AI-ready.’ Spe­
cifically, this study identifies the various dimensions of AI readiness through in-depth semi-structured interviews
with top- and middle-level managers from 52 multinational corporations in Southeast Asia, primarily in India.
This study employed a qualitative data analysis approach to construct a grounded theory model focusing on AI
readiness. The methodology involved systematic examination and coding of data to identify key themes and
patterns, enabling the development of a comprehensive theoretical framework. The findings suggest that AI
readiness can be categorized into eight dimensions: informational, environmental, infrastructural, participants,
process, customers, data, and technological readiness. This study makes a significant contribution to marketing,
management, and information systems by conceptualizing the AI readiness construct and identifying its key
dimensions.

1. Introduction Organizations must adapt to technology and vice versa to fully

Artificial intelligence (AI) has attracted substantial attention among
businesses. In 2022, the global AI market was valued at $136.55 billion,
and is expected to grow at an annual rate of 37.3% between 2023 and
2030, potentially reaching $1.8 trillion by 2030 (Grand View Research,
2023). At the same time, more than 60% of businesses expect AI to boost
their productivity and are embedding AI into their operations (Haan and
Watts, 2023). Nevertheless, many organizations find adopting and
managing AI challenging (Davenport et al., 2020; Kumar et al., 2019;
Wirtz and Zeithaml, 2018; Appio et al., 2023; Mariani et al., 2023). This
difficulty is often associated with a lack of organizational readiness to
implement AI, including vital components such as necessary infra­
structure and mechanisms (Bradley et al., 2012; Weiner, 2009). Further,
many managers fail to accurately gauge whether or not their companies
are ready to implement different AI technologies (e.g., Nortje and
Grobbelaar, 2020; Porcher, 2020).
benefit from technical advancements (whether related to AI or not);
doing so requires a degree of readiness (Holmstrom, 2022). Fortunately,
there is much literature available on the topic of technology readiness
and adoption both in B2B and B2C markets (e.g., Lin et al., 2007; Par­
asuraman, 2000; Venkatesh and Davis, 2000; Vize et al., 2013; Khvatova
et al., 2023). However, autonomous AI agents’ dynamic and complex
nature sets them apart from more static technologies, such as self-service
machines or traditional web-based services that rely on “if-then” algo­
rithms. Adding to this complexity, the black-box nature of the algo­
rithms that determine the AI’s operations creates a hurdle for
organizations seeking to use AI, as its functions are often hard to
comprehend and its benefits tricky to evaluate (Lindgren and
Holmström, 2020; Pasquale, 2015).
Meanwhile, being able to evaluate the benefits of various techno­
logical platforms is a key element of most related technology readiness
and adoption frameworks (Parasuraman, 2000; Venkatesh and Davis,

* Corresponding author.
E-mail address: f.appio@psbedu.paris (F.P. Appio).

https://doi.org/10.1016/j.technovation.2023.102948
Received 7 July 2023; Received in revised form 13 November 2023; Accepted 15 December 2023
Available online 1 January 2024
0166-4972/© 2023 Elsevier Ltd. All rights reserved.
A.N. Tehrani et al.
2000). Therefore, to assess organizations’ readiness for AI, we cannot
solely rely on traditional readiness theories. This issue calls for contex­
tually relevant insights about organizational AI readiness to advance
and complement existing theories. Moreover, some research hints at the
fact that achieving AI readiness requires different capabilities than those
needed for the successful adoption and implementation of other tech­
nology (e.g., Fernandes and Oliveira, 2021; Huang and Rust, 2018).
Indeed, adopting AI often requires an organization to make more sub­
stantial and ongoing changes in terms of its personnel, decision-making
processes, and allocated resources (Davenport, 2018).
Despite much work in the field of technology adoption, knowledge
on how organizations can best get ready to adopt AI is still in its infancy,
with only a few studies focused on this aspect (see Nortje and Grobbe­
laar, 2020; Porcher, 2020; Holmstrom, 2022). Although AI readiness
(AIR) has been examined at government (e.g., Stirling et al., 2017), in­
dustry (e.g., Vuong et al., 2019), and individual levels (e.g., Dai et al.,
2020), its investigation at the organizational level is a relatively new
area of research. With this in mind, and given the discussed limitations
of existing technology readiness and adoption theories in understanding
organizational AIR, this study aims to address the following research
question: What does it mean for an organization to be AI-ready?
To conceptualize and evaluate organizations’ AIR, we applied a
grounded theory approach (Corbin and Strauss, 2014; Strauss and Cor­
bin, 1997). Specifically, we conducted 52 semi-structured in-depth in­
terviews with purposefully sampled decision makers across different
organizations. Each interviewee was chosen from a different multina­
tional company with head offices in France, the USA, Germany, India,
and the UK, among others. The interviews were conducted either in
person or online, with most face-to-face interviews occurring in India.
To enhance the applicability of our findings, we conducted interviews
across multiple industries, including health care, financial services, and
telecommunication (Corbin and Strauss, 2014; Nicholls, 2020). This
approach allowed us to capture the core elements of AIR and ensured
that our study offers potentially valuable insights to managers from
different organizations and industries. We analysed the data by applying
open and axial coding to create first- and second-order concepts (Gioia
et al., 2012; Strauss and Corbin, 1997). We then provided the results in
the form of an overarching model of organizational AIR.
Our results suggest that organizational AIR can best be captured with
8 dimensions: informational, environmental, infrastructural, partici­
pants, process, customers, data, and technological readiness. Each of the
eight identified AIR dimensions consists of three sub-dimensions.
Together, these dimensions help identify the essential resources and
capabilities that organizations should develop to make the most of their
AI investments. For example, data readiness stipulates that organiza­
tions should have access to data that meet a number of criteria such as
quality, availability, and volume. Our findings suggest that—without
data that meet those criteria—most organizations will struggle to
effectively feed their AI algorithm, which will undermine any potential
efficiency and productivity improvements. Other dimensions of AIR are
described in detail in Section 4.
In addition to the eight dimensions of AIR, our study identifies five
strategies for optimizing AI adoption within organizational operations
and marketing activities and explores the relationship between these
strategies and the AIR dimensions. In so doing, we unveil a typology of
five AI adoption strategies along two dimensions: managerial goals (cost
reduction vs. differentiation) and level of risk of AI adoption in the or­
ganization, including technological risk, financial risk, risk of rejection
by workers, among others (Mitropoulos and Tatum, 2000; Zirar et al.,
2023).
Our study makes three key contributions. First, we empirically and
theoretically conceptualize the construct of AIR. While several defini­
tions and conceptualizations of (non-intelligent) technology readiness
exist (e.g., Blut and Wang, 2020; Parasuraman, 2000), the concept of
AIR has, to date, received little research attention. Consequently, we
conceptualize AIR based on our research findings and principles from
2
Technovation 131 (2024) 102948
Weiner’s (2009) organizational readiness theory. In providing our AIR
definition, we add conceptual clarity to the literature on AI and related
information technology, and we provide a more nuanced picture of what
it takes to get AI-ready. Doing so matters for several reasons, not least
because many managers struggle with the decision of whether or not to
adopt AI (and to what extent) (Chui and Malhotra, 2018), and most
research on various AI-related aspects fails to address this issue as they
focus on operational AI aspects, such as usefulness and ease of use (e.g.,
Belanche et al., 2019; Pillai et al., 2021).
Second, our work supports those studies that treat organizational
readiness as a degree of readiness residing on a continuum (Klein and
Kozlowski, 2000; Weiner et al., 2008). Prior research suggests that
readiness is not a binary concept (ready or not) and that it should be
considered as a degree of readiness instead (Weiner, 2009). We add to
this body of work by identifying eight dimensions of AIR determinants.
Each of these dimensions contributes to the overall degree of AI readi­
ness when put into practice.
Third, we introduce and explain five distinct AI adoption strategies,
along with two crucial dimensions: organizational managerial goals and
the risk level associated with AI adoption. This classification contributes
to the body of knowledge concerning technology adoption strategies by
elucidating pertinent boundary conditions affecting the choice of AI
adoption approaches (Edmondson and McManus, 2007). Further, our
work identifies several promising future research avenues and provides
practical guidance for managers. In brief, our findings can assist man­
agers in optimizing their AI investments by identifying areas within the
AIR dimensions that require improvement.
2. Background
AI refers to “machines performing cognitive functions usually asso­
ciated with human minds, such as learning, interacting, and problem
solving” (Raisch and Krakowski, 2021, p. 194). In an organizational
context, AI is often defined as a set of algorithms, tools, and techniques
that are embedded in organizational processes for the benefit of the
organization and its stakeholders (Jarrahi, 2018). Advances in cloud
computing, algorithms, and big data have ushered AI research and
practice into a new era leaving only a few sectors and industries unaf­
fected by AI developments. Currently, research has identified and
explored AI’s potential across different sectors, such as healthcare (Yu
et al., 2018), hospitality (Yang et al., 2020), retail (Guha et al., 2021),
and manufacturing (Li et al., 2017). Much work has focused on AI
techniques like natural language processing, computer vision, image
recognition, deep learning, and sensors that enable AI to perceive,
comprehend, act, and learn intelligently (e.g., Bawack et al., 2019; Duan
et al., 2019). In the following subsection, we delve deeper into the role
AI plays in an organizational context.
2.1. AI in organizational research
AI is increasingly impacting different organizational functions. From
an operational and managerial point of view, AI has been shown to
impact work, manufacturing, knowledge management, decision sup­
port, optimization, and risk management (Choi et al., 2018; Loureiro
et al., 2020). In marketing, several studies have explored AI’s role in
activities such as CRM, customer service, sales, and advertising
(Davenport et al., 2020; Kietzmann et al., 2018; Kumar et al., 2019).
Table 1 shows a summary of organizational studies on AI and how our
article differs from these to advance the literature on AI (see the first row
of AI Readiness).
As shown in Table 1, research on AI in organizational studies has
mostly been dedicated to the adoption, satisfaction, and successful
implementation of AI (e.g., Belanche et al., 2019; Pillai et al., 2021).
These studies can be divided into two main foci (see the column with the
title Focus Side in Table 1). The first focus is on customers and delineates
factors related to the implementation of AI from the customers’ side
 A.N. Tehrani et al.
Table 1
How the current article contributes to the literature on successful AI implementation.
Theme Study Methodological Approach Theory Readi-ness Focus Side Firm Level Cross-industry Adoption Strategies

AI Readiness Current article Qualitative WSF, ORC ✓ Organization ✓ ✓ ✓

Jöhnk et al. (2021) Qualitative ORC, TAM, TRA, TPB ✓ Organization ✓ ✓ ×
Kinkel et al. (2022) Quantitative TOE ✓ Organization ✓ ✓ ×
Holmstrom (2022) N/A Digital transformation ✓ Organization ✓ × ×
Behl et al. (2021) Quantitative CVM, UTAUT ✓ Organization × × ×
Dai et al. (2020) Quantitative TPA, TPB, Self-determination theory ✓ Customer × × ×
AI Adoption Pillai et al. (2021) Mixed-method TOE × Organization ✓ × ×
Pillai and Sivathanu (2020) Mixed-method TAM × Customer × × ×
Lee et al. (2022) Quantitative Absorptive capacity × Organization ✓ × ×
Braganza et al. (2021) Quantitative Economic/Social exchange theory × Organization ✓ ✓ ×
Mariani et al. (2023) Literature review Multiple-theory × Organization ✓ N/A ×
Moriuchi (2019) Quantitative TAM × Customer × × ×
3

Belanche et al. (2019) Quantitative TAM × Customer × × ×

Hu et al. (2021) Quantitative Mind perception theory × Customer × × ×
De Cicco et al. (2020) Quantitative Social Presence Theory × Customer × × ×
Gursoy et al. (2019) Quantitative CAT, CDT × Customer × × ×
Liker and Sindi (1997) Quantitative TRA × Organization × × ×
AI Satisfaction Ashfaq et al. (2020) Quantitative ECM, ISS, TAM × Customer × × ×
Prentice et al. (2020) Quantitative SERVQUAL × Customer × × ×
Brill et al. (2019) Quantitative Expectations confirmation theory × Customer × × ×
Chen et al. (2021b) Quantitative TAM, Information system success model × Customer × × ×
Ameen et al. (2021) Quantitative Trust-commitment theory × Customer × × ×
Li et al. (2019) Quantitative – × Organization × × ×
AI Implementation Chatterjee et al. (2020) Qualitative – × Organization ✓ ✓ ×
Dicuonzo et al. (2023) Qualitative Health technology assessment framework × Organization × × ×
Grover et al. (2020) Qualitative PC utilization model × Organization × ✓ ×
Cao et al. (2021) Quantitative UTAUT, TTAT × Organization × ✓ ×

Technovation 131 (2024) 102948

A.N. Tehrani et al.
including customers’ adoption of AI-embedded touchpoints. The most
common determinants of customers’ adoption of AI-enabled technolo­
gies are perceived usefulness and ease of use (Moriuchi, 2019), hedonic
and utilitarian values (Belanche et al., 2019), enjoyment, visual attrac­
tiveness (Yang and Lee, 2019), autonomy and competency (Hu et al.,
2021), and performance risk (Liang et al., 2020). Adoption rate is also
affected by the demographic profile of customers such as age and gender
(De Cicco et al., 2020; Ivanov et al., 2018) and performance and effort
expectancy (Gursoy et al., 2019). It has been shown that when customers
interact with AI across touchpoints (e.g., chat bots, robots, etc.), their
satisfaction and experience are influenced by service quality (Ashfaq
et al., 2020; Prentice et al., 2020), information quality (Ashfaq et al.,
2020), usability and responsiveness of AI (J.-S. H. Chen et al., 2021),
perceived convenience, extent of personalization (Ameen et al., 2021),
and their own expectations (Brill et al., 2019).
The second focus is on the successful adoption and implementation
of AI by employees, managers, and organizations. Most AI scholars
argue that several factors related to AI can impact organizational
adoption of AI solutions. These factors include complexity, compati­
bility, relative advantage, perceived risk, perceived usefulness,
perceived impact on career and job security, effort expectancy, perfor­
mance expectations, trust, managerial support, and vendor partnership
(Chatterjee et al., 2020; H. J.-S. Chen et al., 2021; Liker and Sindi, 1997).
Also, in an organizational management context, studies show that
several factors including job fit, perceived consequences, emotion to­
wards use, social factors, and facilitation conditions can support a
fruitful use of AI in organizations (Grover et al., 2020). There are also
studies that conclude that employees’ fear of job loss acts as an adoption
hurdle (Schwabe and Castellacci, 2020) while AI awareness, organiza­
tional support, R&D intensity, company size, and competitive climate
can facilitate AI adoption (Li et al., 2019; Kinkel et al., 2022). Our study
too explores organizational factors that affect organizations’ AI
deployment; we thus contribute to the second research focus.
Despite much research progress in the field of AI adoption and
implementation, studies on different dimensions of AI readiness are in
the early stages of development (see readiness column in Table 1 for
some examples). Moreover, as shown in Table 1, several studies consider
individuals as their unit of analysis. Although this approach provides
much insight into AI readiness considerations at an individual level, AI
use often influences different organizational functions (Holmstrom,
2022). Thus, to achieve a more holistic view of how AI can be used
effectively, scholars should also explore AI’s role at an organizational
level. In a conceptual article, Holmstrom (2022) proposes an AI readi­
ness framework that includes four essential dimensions: technology,
activity, boundaries, and goals. While the framework has significant
theoretical value, it could benefit from empirical insights. While some
researchers have initiated work in this area, these studies often have a
limited scope. For example, Hradecky et al. (2022) explored AIR
through 17 interviews in the relatively narrow context of exhibitions
sector of event industry. While others, such as Jöhnk et al. (2021)
explore AI readiness factors at an organizational level, they too gather
empirical data from a relatively narrow set of participants (that is, AI
experts only). However, AI experts are not the sole key informants on the
topic, as the deployment of AI is not just a technical measure. Rather, it
involves managerial decision-making concerning strategic, financial,
and other resources, as well as the consequences associated with AI
implementation (Duchessi et al., 1993; Enholm et al., 2021). Consistent
with other studies (e.g., Pillai et al., 2021), we collected data from top-
and middle-level managers. Our research aims to advance knowledge,
focusing on two critical aspects: a) developing a comprehensive model
of organizational readiness for AI adoption involving a diverse range of
multinational organizations across various industries, and b) developing
AI adoption strategies while considering relevant boundary conditions.
In the next section, we will explore the concept of readiness to better
understand the foundations of our proposed AI readiness construct.
4
Technovation 131 (2024) 102948
2.2. Organizational readiness
To develop an organization-centric conceptualization of AIR, we
draw on the definition of Organizational Readiness for Change (Weiner,
2009; Weiner et al., 2008), which allows us to reach a precise under­
standing of the readiness concept and its conditions and dimensions.
Organizational readiness for change refers to organizational readiness as
a state of cognitive, emotional, and behavioural preparedness toward a
change that is reached before the commencement of an activity (Weiner,
2009). Organizational readiness is a well-defined concept in different
fields including healthcare (Saldana et al., 2007), management (Jones
et al., 2005), and information systems (Zhu et al., 2003). Across these
fields, organizational readiness is seen as the preparedness and capa­
bility of an organization to implement specific initiatives like innovation
or a change in general (Clark et al., 1997). As mentioned, organizational
readiness is a quality that should be acquired before starting an activity
in an organization (Weiner, 2009). Therefore, the evaluation of orga­
nizational readiness towards a specific activity, such as adopting AI, is
key since it delineates a pre-assessment of the organizational capabilities
in terms of the required tangible and intangible resources; it represents
the right spot in which those capabilities are needed, and it helps control
the risk of failure (Bharadwaj, 2000; Yen et al., 2012).
2.3. AI readiness
With the above conceptualizations in mind, we define AIR as the state
of an organization in terms of willingness and ability of its stakeholders, and
suitability of its environment, processes, data and resources for adopting and
operating AI. This definition is based on our findings and builds upon the
definition of Weiner’s (2009) organizational readiness for change that
suggests that readiness stems from the cognitive, emotional, and
behavioural preparedness of an organization toward a specific issue.
These different types of preparedness relate to—and should be explored
across—different dimensions of an organization. Thus, we require a
suitable framework that describes the dimensions of an organization
that can potentially affect AIR. To this end, we adopt Alter’s (2013,
2015) work system framework as an overarching framework, since it is
“a useful basis for describing and analysing an IT-reliant work system in
an organization” (Alter, 2015, p. 11). A work system is defined as “a
system in which human participants and/or machines perform work
(processes and activities) using information, technology, and other re­
sources to produce specific products/services for specific internal
and/or external customers” (Alter, 2015, p. 4) that, in our study, is an
organization pursuing AI implementation. The work system framework
describes every work system by nine essential elements including par­
ticipants, information, technologies, processes, products/services, cus­
tomers, strategies, environment, and infrastructure. Table 2 provides a
description of nine elements of the work system framework. The work
system framework has been widely used in IT/IS and management
studies (e.g., Krotov, 2017; Laumer et al., 2016). In line with the
exemplified studies, we use the elements of a work system as a
discriminative and generalizable foundation to categorize abundant and
fragmented notions about AI readiness and to develop a multidimen­
sional AIR construct.
3. Method
3.1. Research design
Organizations’ readiness to adopt AI is a complex and multi-faceted
construct. Therefore, inductive methods are suitable to grasp the
complexity in the infrastructures and mechanisms involved in getting
organizations AI-ready. Following other qualitative studies in market­
ing, management and IS (Johnson and Sohi, 2016; Urquhart and
Fernández, 2013), we adopt a grounded theory approach (Corbin and
Strauss, 2014; Strauss and Corbin, 1997) that includes the iterative
A.N. Tehrani et al.
Table 2
Description of work system framework elements (Alter, 2013).
Element Description
Processes Processes represent the activities and workflows within the
system, detailing how tasks are executed and managed to provide
customers with the system’s offering.
Participants This element include all individuals who interact with the
system, including IT users and non-users.
Information Information includes the data and knowledge used, created, or
processed within the work system, ranging from raw data to
processed information and insights.
Technologies Technology refers to the tools, hardware, and software that is
used by participants of the work system and automated agents as
well.
Product/ This element includes the goods or services that the work system
service produces or delivers to the customers. It includes the design,
development, production, and delivery processes related to the
tangible or intangible products or services.
Customers Customers represent the individuals or entities that receive or
benefit from the products or services produced by the work
system.
Environment The environment element considers the broader context in which
the work system operates. These are external factors, such as
regulations, market conditions, and competitors, which influence
and interact with the work system.
Infrastructure Infrastructure refers to the human, technical, and other essential
resources necessary to both support and be used by the work
system.
Strategies Strategy refers to the overarching goals, objectives, and plans
that guide the work system’s operations and decision-making.
series of collection and analysis of field data and literature to move to­
wards building theory on AI and associated notions. Grounded theory is
one of the commonly used approaches for qualitative research in orga­
nizational studies to conceptualize constructs and develop theory
(Johnson and Sohi, 2016; Netland and Ferdows, 2016). We adopt this
qualitative approach because, for investigating a complex and weakly
understood phenomenon, experts recommend discovery-oriented
research approaches that depend on qualitative data collection and
concept development (Closs et al., 2011; Edmondson and McManus,
2007). Since AIR is a new construct and the scope and nature of AIR are
not explored yet, we need a suitable research approach that involves
both theoretical and empirical research and helps us to understand the
essence and dimensions of AIR.
Grounded theory relies on a continuous contrast of different sources
of data, such as qualitative data and literature (Closs et al., 2011). We
adopt the definition of organizational readiness for change (Weiner,
2009; Weiner et al., 2008) to conceptualize the construct of AIR, as its
tenets offer the theoretical scaffold to explore AIR in organizations using
grounded theory guidelines. Moreover, we adopt Alter’s (2015) work
system framework as its different dimensions provide a discriminative
generalizable foundation to categorize abundant and fragmented no­
tions about AI readiness that help us develop the multidimensional AIR
construct.
3.2. Sample and data collection
Consistent with other exploratory organizational studies (e.g.,
Challagalla et al., 2014), we used a theoretical sampling method
including purposive and selective sampling. Xavier Institute of Man­
agement provided us with a list of collaborating multinational com­
panies, which they could approach and introduce us for data collection
purposes. We carried out desk research to learn about the companies to
make sure they were using AI in their operations and to facilitate access
to them. We selected our interviewees among top- and middle-level
managers of selected companies who had been involved in AI imple­
mentation in their organizations; key informants often provide the most
useful and profound understanding of a topic (Corbin and Strauss,
2014), and AIR is no exception.
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Technovation 131 (2024) 102948
Over 12 months in 2020 and 2021, we conducted 52 in-depth in­
terviews either in person or online with managers of 52 different
multinational companies with head offices in France, the USA, Germany,
Ireland, Singapore, India, and the UK, among others (see Appendix A for
a full list of organizations and interviewee characteristics). The selected
participants held senior positions (e.g., Sales Manager, Product Man­
ager, CEO, Chief Technology Officer, Managing Director), and they had
been involved in decision making about operation of AI. Where possible,
we gave the participants the option of conducting the interviews online,
by telephone, or in person based on their preference. The interviews
were conducted in English. To broaden the scope of our study, we
recruited diverse participants in terms of their industries (Corbin and
Strauss, 2014) including manufacturing (e.g., clothing, food, electronic
appliances) and services (e.g., IT and ICT, financial services, hospitality,
and healthcare). We stopped sampling when we reached theoretical
saturation, that is when more interviews did not lead to new insights
(Strauss and Corbin, 1997). The average length of interviews is 52 min
with a total length of 45.5 h. The transcribed interviews consist of
approximately 219,000 words in 455 single-spaced pages.
To conduct our interviews, we used a semi-structured interview
guide developed based on a review of the literature on the use of tech­
nology in organizations, and we further revised the interview guide as
the data collection and analysis continued. The interview guide includes
three sections. The first section is about the traits of the interviewees and
their organizations (such as respondents’ designation and organizations’
industry). The second section refers to the concept of AI readiness.
Through open-ended questions in this section, we asked the participants
about the enablers and requirements for their organization to be AI-
ready. Initial open-ended questions included “what capabilities or
characteristics should an organization have to be ready to implement
AI? And what factors will facilitate adopting and implementing AI in an
organization?” Then, we continued with probing questions, which
changed so as to reflect emerging theoretical themes. After seven in­
terviews, we refined the interview guide and added the third section to
address strategies that managers have applied to adopt AI. Initial open-
ended questions for AI adoption strategies included “in adopting AI,
what area(s) or activity(s) did you start with? Why? What was next? And
what was your strategy to adopt AI in your organization?”
3.3. Data analysis
To analyse the data, we used open, axial, and selective coding to
create first-order concepts, second-order themes, and aggregate di­
mensions, respectively (Gioia et al., 2013). This method has been widely
used in organizational studies (e.g., Challagalla et al., 2014; Homburg
et al., 2017). We proceeded in three main steps. First, we coded the
interview data by open coding and identifying, line by line, preliminary
concepts based on participants’ statements. We then grouped the related
concepts to form first-order concepts. Following the Gioia method (Gioia
et al., 2012), we formed the first-order concepts after resolving overlaps
and redundancies. The second step involved axial coding. In this step,
we contrasted the first-order concepts with the literature to identify
relationships among them (within and across interviews) to develop
second-order themes. Unlike first-order codes that are developed based
on primary interview data, second-order themes are theoretically ab­
stract themes created by the researcher (Nag and Gioia, 2012). Finally,
during the selective coding step, we rearranged the second-order themes
and categorized the theoretically relevant ones into eight aggregate di­
mensions of AIR. In parallel, our iterative engagement with the work
system framework as well as our going back and forth between quali­
tative data and literature led us to the emergent themes and dimensions
(Gioia et al., 2012). We also grouped managers’ similar strategies to
adopt AI in terms of the step they began with, the procedures they went
through, and some situational factors. In so doing, we identified five AI
adoption strategies. During the data analysis, we further eliminated a
few categories that fit weakly, specifically regarding the recognized
A.N. Tehrani et al.
second-order themes. Throughout the data analysis, we used NVivo to
facilitate coding procedures. At the end of this process, we developed a
three-layered framework of organizational AIR anchored in the tenets of
work system theory. Fig. 1 shows our data structure including our 61
first-order concepts, 24 s-order themes, and eight aggregate dimensions
of AIR construct.
To ensure our findings’ credibility and trustworthiness, we adopted
Fig. 1. Data structure.
6
Technovation 131 (2024) 102948
principles of analyst and data triangulation (Lincoln and Guba, 1985).
To triangulate our data, we started from a theoretical perspective and
repeatedly contrasted our qualitative data with relevant theories (Sil­
verman and Marvasti, 2008). We also selected samples from a variety of
industries in both manufacturing and services to acquire a diverse
sample (Homburg et al., 2017) and to ensure that our findings are
applicable to a broad audience (Lincoln and Guba, 1985). For analyst
A.N. Tehrani et al.
triangulation, after one researcher analysed the data, another researcher
conducted the three stages of coding and interpretation. Then, two re­
searchers shared and compared their interpretations and discussed any
differences in their individual findings (Yin, 2015).
4. Findings
4.1. Grounded theory framework of AIR
As shown in Fig. 1, our results suggest that AIR is an organizational
construct that can be categorized along eight aggregate dimensions: (1)
environmental readiness, (2) technological readiness, (3) informational
readiness, (4) infrastructural readiness, (5) data readiness, (6) partici­
pants’ readiness, (7) customers’ readiness, and (8) process readiness. To
illustrate our findings more concisely, we provide a schematic model of
AIR in Fig. 2. Fig. 2 includes AIR dimensions on the outer rings and
pertinent sub-dimensions (second-order themes) on the inner rings. In
the next sections, we elaborate on each of those core dimensions and the
related second-order themes that emerged from our data. To introduce
each second-order theme, we provide a general description including
Fig. 2. Schematic model of AIR.
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Technovation 131 (2024) 102948
representative sample quotes from our study participants.
4.1.1. Environmental readiness
We found that organizational AIR depends on environmental factors.
According to the work system framework, the environment consists of
the organizational, technical, competitive, cultural, and regulatory
environment within which an organization operates (Alter, 2015).
Environmental factors relate to both the macro-environment and the
organizational environment. In this study, we merge external and in­
ternal environmental factors into a unified dimension, emphasizing the
interplay between these forces. This approach underscores that organi­
zations can effectively adapt to their external environment by leveraging
internal elements, such as their organizational culture (Arogyaswamy,
1987). Our goal is to provide clarity regarding the influence of envi­
ronmental factors on firms’ AI implementation, highlighting the
importance of organizations considering both their external and internal
environments as they prepare for AI.
From the view of the organizational environment, our data outline
the importance of organizational culture and leadership as the most
important factors. Organizational culture, as a determinant of AI
A.N. Tehrani et al.
readiness, received citations from many participants. They enumerated
some specifications of an organizational culture which can help AI
adoption including collaboration, openness, tech-friendliness, competi­
tiveness, and willingness to learn. This finding adds to other studies that
highlight the significance of organizational culture in the adoption of
new practices (Dasgupta and Gupta, 2019) by identifying the specifi­
cation of a suitable organizational culture to support AI use. Table B in
Appendix B shows the dimensions of organizational culture and some
pertinent quotes. Also, our participants asserted that leadership is a
facilitator of AIR that can affect other dimensions of AIR like partici­
pants’ readiness, and it can also assist AI adoption by “convincing the
employees about the benefits of AI technology” (R291) and “removing their
concerns about their job loss” (R18). Echoing the importance of leadership
role in the process of AI adoption, a senior consultant of an IT company
pointed out:
As I said, to bring everybody on the same page is itself a huge task.
The way people perceive business and the way they prefer to drive
their business is entirely different and varies from person to person. It
is the responsibility of your leadership (R13).
Our respondents expressed that the regulatory environment within
which an organization operates directly affects the organization’s AIR.
There has been a growing discussion in recent years regarding how to
regulate AI and the role of government institutions in that process (e.g.,
Fast et al., 2023; Kokshagina et al., 2023; Minkkinen et al., 2023). This
study also specifies regulatory considerations of using AI for any use
cases and how those impact AIR. In so doing, our data suggest that some
countries have more supportive or restrictive regulations than others for
companies to deploy AI. This can be observed in their regulations in
using personalized data, cloud computing, selling through bots, and so
forth. For instance, in some countries, organizations have to keep their
customers’ data not on cloud systems but on their own servers. In a
European context, our respondents stated that “Based on GDPR [general
data protection regulation], data must be stored in the European Union and
not outside” (R33), and “(…) If data leak, companies will be penalized by
the government” (R2). On the other hand, the regulatory environment in
other regions could be different as the medical director of a health care
services provider said:
In an Indian context, we can drive marketing through bots, but we
are not allowed to sell any products using bots. (…) But, here [in
Europe], we definitely have great support from the government.
There are a lot of opportunities that they are giving to start-ups
(R29).
Clearly, companies should consider their regulatory environment to
assess if it supports their planned activities. For example, when a com­
pany intends to establish a sales system using bots, it has regulatory
environmental readiness if it performs in Europe but not in India.
Although companies are unlikely to be able to directly influence their
regulatory environment, they can make informed decisions for their
businesses and adapt to their regulatory environment, if not willing to
switch macro-environment. All in all, to implement AI, companies need
to have a suitable organizational culture, effective leadership, and a
supportive macro-environment for their use of AI.
4.1.2. Technological readiness
Technological readiness is related to the technological maturity of
the organization, having the right techniques to effectively use AI, and
benefiting from suitable IT support. Technological maturity proved to be
important for organizations seeking AIR. Consistent with the definition
of IT maturity, we describe technological maturity as an organization’s
degree of sophistication and experience in using technology (Gorla et al.,
2017). Further, our data suggest the significance of technological
1
Respondent 29 (see Table A in Appendix A for respondents’ codes).
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Technovation 131 (2024) 102948
maturity as the implementation of many AI solutions requires a high
level of organizational experience with technology. This experience
pertains to the cumulative and historical knowledge and proficiency of
the entire organization in adopting and effectively using new technol­
ogies. While some overlap may exist, organizational maturity differs
from employees’ individual skillsets in working with these technologies
(see “participants’ readiness” in subsection 4.1.6). Highlighting the
significance of technology maturity, the sales manager of an American
food company stated:
In terms of technology, I’m tempted to say that maturity is a key
here. There are some aspects of AI that are useful for a fledgling
company such as having a virtual assistant or a helpful chatbot, but
other AI solutions require a great amount of experience with tech­
nological solutions. So, it is not just a problem of acquiring top tools
(R15).
Our data also suggest a need for suitable techniques to take advan­
tage of AI, which corroborates prior research asserting that having the
right technological techniques matters for leveraging the potential of
data and translating it into practice (e.g., Alter, 2015). We also extend
this work by identifying suitable techniques required for implementing
AI such as data management, data mining, data analysis, clustering
techniques, and so forth, which, all in all, relate to the organizational
ability to process and manage stored data. The manager of an American
retailing company emphasized the importance of using suitable tech­
niques saying, “The factors that will help companies use AI will majorly
depend upon, firstly, their capability to process the data, and secondly, the
techniques they apply to analyse and understand the outputs” (R11). Elab­
orating on the right techniques required for AI deployment, a manager
of a consulting services provider also said:
I think, most of the time, it is a technical issue because if you are
building something which is AI-driven, the major challenge will be
whether your team is capable, and have the good techniques to
implement that technology. For example, Flipkart, Amazon, and
other technology giants are adopting AI, because they have all
required techniques like data management, clustering, node analysis,
and so on (R17).
In addition to the mentioned factors, to fully benefit from AI po­
tential, organizations need to avoid any disruptions. To avoid disrup­
tions, acquiring support from the IT team matters. Even skilled
employees often need help from the IT team to work with AI. A medical
director of a health care services provider explained, “IT staff can help to
have everything running smoothly. There shouldn’t be any bottlenecks”
(R29). These technical bottlenecks can sometimes stop the whole system
for hours or more. Therefore, having enough and regular support from
the IT team is key.
4.1.3. Informational readiness
The role of information and its characteristics in business has been
widely researched in the management, marketing, and IS literature
(Blanco et al., 2010; Dewett and Jones, 2001). Moreover, organization
theory considers information as one of the key resources for organiza­
tions (Daft, 2007). Our findings too point toward the significance of
information in the process of organizations’ preparation for AI adoption
with citations from nearly all interviewees. We distinguish information
from raw data (data readiness is explained in subsection 4.1.5 as a
separate dimension of AIR), and for this study, we define information as
people’s meaningful understanding of a special issue. Informational
readiness to adopt AI refers to the state of decision makers’ information
about AI use cases (specific areas or situations in which AI can be used),
their organizations’ problems, and different AI solutions to address their
problems. Within this description, we separate AI-related decision
makers from other employees and managers because, rather than
working with AI like other employees, AI-related decision makers need
to decide on whether they should deploy AI and for what purposes, if so.
A.N. Tehrani et al.
Thus, for their decision making, they need more information than just
some general understanding of how to deal with AI. Highlighting this
issue, more than half of our respondents suggested that organizations’
decision makers should be aware of AI use cases in the business realm
and their industry, their organizations’ problems across those use cases,
and different AI solutions to help solve their problems. This finding
supports Gartner’s survey (2019) that highlights “finding use cases of
AI” as one of the top three barriers to AI adoption. Also, the CEO of an
organization operating in the media industry said:
Many use cases [of AI] are available in the market, such as use cases
of forecasting, predictive analysis, digital advertisements, content
generation, and market segmentation. To make a profitable use of AI,
this is what decision makers should be aware of (R34).
Furthermore, our data indicate that decision-makers must identify
and acknowledge the issues that, if resolved, could have a substantial
impact on their organizations’ operations. Today, there are lots of use
cases for AI in almost all business sectors, but deploying too much AI in
different sections could increase operational complexity (Modrak and
Soltysova, 2018) and decrease staff acceptance of AI solutions (Chat­
terjee et al., 2020b) for a company newly pursuing AI use. Thus, decision
makers should recognize their companies’ main problems to find AI
solutions for them. The product manager of an American consulting
service organization interestingly used a metaphor to show the impor­
tance of problem recognition; “There are lots of medicines in the market,
but you first need to identify the pain of yours that needs to be alleviated”
(R9). Echoing this issue, a manager of a financial services provider
explained:
As AI use is cost-intensive and there is almost no area that managers
are not able to employ AI, they should understand what their prob­
lem is. Next, they should evaluate whether the problem can be solved
through less-complicated automation solutions or whether it needs a
sophisticated algorithm of machine learning or deep learning. If so,
they can try to address the problem or problems with pertinent AI
solutions (R35).
Further, our data suggest that to make the most of their AI in­
vestments, decision makers should be familiar with different AI solu­
tions existing in the market for the problem that they are trying to solve.
Different companies are producing AI solutions and many of them pro­
vide various products for different needs. Decision makers need to
evaluate those AI solutions to decide which ones meet their needs better;
they can further perform a cost-benefits analysis to choose between.
Commenting on decision makers’ awareness of different AI solutions,
the sales manager of a Fortune 500 food manufacturing company
explained:
We used to have a software called Base, but we switched to Salesforce
for lead tracking, conversion, etc. We did so because Salesforce can
help track leads better, track every step in the pipeline, and provide
insights. So, as you see, for a single problem, there are plenty of
solutions in the market. You should be aware of those and choose in
between (R15).
To sum up, informational readiness toward AI mainly relates to de­
cision makers in an organization and includes the level of their infor­
mation about AI use cases, their companies’ problems across every use
case, and different AI solutions for each problem.
4.1.4. Infrastructural readiness
Infrastructural readiness emerges from our data as the availability,
relevance, continuity, and flexibility of organizational resources
including financial resources, human resources, and IT resources that
facilitate the adoption and use of AI. This finding adds to prior research
that highlights the importance of infrastructure for operation perfor­
mance (e.g., Rai et al., 1997) by identifying types of infrastructure that
are of great importance for organizational AIR. From a purely technical
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Technovation 131 (2024) 102948
viewpoint, infrastructure relates to tools, computers, and networks.
However, from an organizational viewpoint, it can also include human
resources, financial resources, and other types of organizational re­
sources, such as time (Star and Bowker, 2006). Our data suggest three
distinct sub-dimensions of infrastructural readiness, namely, human
resources, financial resources, and IT resources. These sub-dimensions
were cited repeatedly by our participants. For instance, the manager
of a consulting services company headquartered in the US said, “It makes
enterprises more ready if they have the bandwidth, the right set of people with
proper skillsets, and the required money to spend on [AI]” (R17).
Financial resources received a high number of citations and is
believed to be one of the most important and challenging determinants
of infrastructural readiness. A senior consultant in the IT and ICT in­
dustry pointed out, “AI, from scratch, will require a huge amount of
financial resources” (R13). Our results suggest that not only do organi­
zations need to have access to sufficient financial resources, but the
capital also needs to be flexible and continuous. Prior research also
highlights the significance of the flexibility of resources, as this would
enable companies to adjust to rapidly-changing dynamic markets (Chen
et al., 2017). Also, we posit that flexible resources should be lasting to
provide continuous support to AI use, as a manager of a paint
manufacturing company explained:
Updating and upgrading AI is the main issue because it changes very
quickly. If you are skewed towards a technology, then it would be an
obstacle for you. This requires flexible financial resources and
continuous investment of money in the technology (R26).
Human resources received citations from all our interviewees. As one
important factor in the resource-based theory of the firm, human re­
sources has been a well-known construct for a long time (Barney, 1996).
This theory suggests that to achieve high performance and sustainable
competitive advantage, organizations must have access to sufficient
strategic resources such as human resources. Similarly, a study in Nature
emphasizes the crucial role of AI talent in the fate and survival of
companies in the AI era (Cyranoski, 2018). Our findings also show how
human resources relate to AIR. Our data suggest that to make the most of
AI, organizations need to both possess skilled in-house employees and
have access to rich sources of AI talents in the market. As an e-commerce
planner of a European clothes manufacturer said, “Every company that
pursues the aim of using AI should have access to internal and external talent
with the right skillsets to support AI” (R5). The characteristics that these
employees need to have to be AI-ready are discussed in a separate sec­
tion (participants’ readiness, section 4.1.6). Our data also highlight the
importance of the human resource department in the process of adopt­
ing and using AI, since adopting any innovation or technology in an
organization requires radical changes in the array of skills and knowl­
edge among employees, which should be acquired through training
current staff and recruiting experts (Braganza et al., 2021; Lokuge et al.,
2019). Commenting on training, one respondent said, “The HR team
needs to enable and upskill our employees by conducting training sessions”
(R5). The CEO of a Singaporean company in the media industry also
highlighted the importance of recruiting experts saying:
The HR department should be able to recruit versatile Machine
Learning engineers who not only have an idea about programming
but also cross-industry domain knowledge. So, HR should appoint
only those candidates who can adapt in any situation (R34).
While there may be some overlap with other concepts, the ‘human
resources’ component primarily focuses on the organization’s flexibility
in allocating skilled employees, accessing AI talent internally and
externally, and the role of HR department initiatives in bridging human
resource gaps for AI adoption. In contrast, the ‘maturity’ sub-dimension
within technological readiness (discussed in subsection 4.1.2) pertains
to the organization’s experience in adopting new technologies. And
‘staff readiness’ relates to the cognitive and emotional readiness of staff
toward the organization’s AI adoption efforts (discussed in subsection
A.N. Tehrani et al.
4.1.6).
IT resources refer to computers, networks, programming languages,
and other technologies. This construct is considered the core component
of IT-reliant organizations in IS and organizational studies (Davenport,
2018; Haug et al., 2011). IT resources received citations from nearly half
of our respondents, who believe that technical tools and IT infrastruc­
ture provide a foundation for AI to function well. For example, the
manager of a financial services provider said, “Another big problem is lack
of technological infrastructure. If the organization is not already on the digital
transformation path, then it will have a hard time deploying AI anywhere,
because at the root of it, what AI will require is a huge IT infrastructure”
(R19). Our results add to the literature on organizational AI deployment
by identifying characteristics of IT resources and tools that can support
the function of AI including a high level of storage capacity, computing
capacity, scalability, and security (see Table C in Appendix B for some
quotes about IT resources and tools). Having IT resources may no longer
beget a core competency for a company using AI; however, the absence
of such resources could hinder the company’s ability to use AI without
encountering disruptions.
4.1.5. Data readiness
From our findings, data readiness emerges as having access to
abundant high-quality and relevant data that feed and support AI. As
noted, we differentiate data from information. Data can refer to
(meaningless) symbols, whereas information is a collection of data that
conveys a logical meaning, that is, knowledge that can be used to answer
a question or solve a problem (Chen et al., 2008). Work system theory
also explains that information is created and used by humans (Alter,
2015), but data are used to feed AI. Therefore, we do not consider data
as a type of information. Rather, we categorize it as a separate dimension
of AIR. The role of data in AI’s function is highlighted across studies and
disciplines (e.g., Huang and Rust, 2021; Tambe et al., 2019). Some
studies have also tried to identify how data leads to high-performance
and reliable AI as a necessity of informed decision making (Lee et al.,
2018; Shabani-Naeeni and Yaghin, 2021). Our results add to those
studies by outlining the specifications of data readiness including data
availability, quality and relevance, and volume. Echoing this perspec­
tive, the CEO of a media company explained, “For AI and machine
learning, copious amounts of data are needed. For efficient Machine
Learning, data should not only be amply available but the relevance and
quality of the data matters” (R34). In short, one of our key findings is that
ample high-quality data is like blood in the veins of AI. Indeed, data reliance
is a key differentiator between AI and other non-intelligent technologies,
such as self-service machines (Moore, 2019).
4.1.6. Participants’ readiness
Participants’ readiness refers to the psychological and behavioural
preparedness of managers, staff, and other stakeholders of an organi­
zation to effectively leverage AI’s value. According to the work system
framework, participants are the humans including managers, em­
ployees, vendors, and other stakeholders who deal with the IT-reliant
work (Alter, 2015). Some studies highlight the impact of the partici­
pants on the fate of technology adoption through their perception of the
technology and their intention to accept or reject it (e.g., Calantone
et al., 2006; Naicker & Van Der Merwe, 2018).
Among sub-dimensions of participants’ readiness, staff was cited by
77% of respondents. In addition, our analysis identified three distinct
subsets for staff readiness: acceptance, trust, and knowledge and skills.
Our results align with prior studies, which show that technology adop­
tion can act as a double-edged sword, affecting employees positively
(think enhanced self-efficacy and empowerment) and negatively (think
techno-stress and isolation) (Apostolidis et al., 2022; Cao et al., 2021;
Chen et al., 2022). We also contribute to this body of research by
explaining how these effects on employees impact an organization’s
technology adoption readiness. Our data also show that AIR “depends on
whether staff has the right skillset to adopt the technology that the company
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Technovation 131 (2024) 102948
wants to buy” (R51). Moreover, staff knowledge is suggested to be
important in AIR as it is the staff that propels the business (Alter, 2015),
and their fluently working with AI systems can help the company
leverage AI value. In most companies, staff are not familiar enough with
AI (Kaplan and Haenlein, 2020) because, even in technology-based or­
ganizations, AI implementation is a relatively new phenomenon.
Reflecting this perspective, the process manager of a European consul­
ting company stated:
No company has that many people specialized in AI. So, to develop a
successful AI solution, your staff needs both technical and business
understanding of AI. (…) if they [staff] are aware of how AI makes
their job easier, they will more easily embrace it (R2).
As our data show, most companies struggle with increasing their
employees’ knowledge on issues like AI deployment benefits for em­
ployees, the necessity of adopting AI, and how to collaborate with AI to
leverage its value best. Also, some staff would need to be experts in
machine learning, Python, and other related fields, and, as discussed in
part 4.1.4, this can happen by training them in the process of internal
training, encouraging them to attend external courses, or recruiting new
talent (McCrindle, 2006).
Moreover, employees’ trust in AI is an important issue, as “many
people think that AI will eat their jobs, and this [lack of trust] is dangerous for
companies” (R44). These findings are consistent with the tenets of the
theory of organizational readiness for change that participants should be
willing (acceptance and trust) and able (skills and knowledge) to deal
with the change in the organization (Weiner, 2009). Elaborating on the
acceptance towards the subsequent changes related to using AI, the
product development manager of an organization in the IT and ICT in­
dustry said, “As our company is a technology-driven organization, the em­
ployees have more acceptance towards adopting and incorporating the
changes required to support AI” (R12).
Managers’ readiness also received many mentions from respondents.
Our data analysis showed that, to be AI-ready, “Managers need to have the
right mindset to adopt AI and invest hugely in AI” (R49). Also, the AI use
should be aligned with managers’ strategic goals and plans. As a senior
manager of a consulting services organization headquartered in Ireland
stated, “To make the most of AI, every company should have an integrated
strategy including AI strategy, business strategy, short-term, and long-term
plans” (R6). Similarly, prior research has discussed the importance of
strategic goals and plans in the process of digital transformation in an
organization (Bharadwaj et al., 2013; Nylén and Holmström, 2015). In
addition, our data show that managers’ high level of innovativeness can
assist companies in making excellent use of AI by exploring a wide range
of probable domains in which AI can be deployed. A manager of a
financial services provider said:
We have already seen AI penetrating the marketing and selling do­
mains a lot, but there are still many areas where you have AI working
for you like the advertising domain or the customer engagement
domain. Managers need to be innovative to explore and find where
else AI can serve them (R19).
Other stakeholders and partners were also deemed important in AIR.
Our data clarify that partners also need to accept working with the or­
ganizations’ designed AI system to keep the flow of work. They should
align their mindset with that of the organization’s managers and strive
for effective coordination. The lead generation executive of a consulting
services provider elaborated:
There are lots of old-style distributors who are more comfortable
with paperwork, filling the tender, etc. If they keep their old-
fashioned mindsets, then organizations have to work with current
practices. And, consequently, organizations will lose their business
later or sooner (R46).
This finding corroborates Zhang and Dhaliwal’s (2009) study that
outlines the importance of collaborating with partners in the supply
A.N. Tehrani et al.
chain to take advantage of technology benefits. The collaboration with
partners could be somehow a challenge, because the mindsets and
behaviour of outer stakeholders are not under the control of the orga­
nization’s managers and, in many cases, they cannot even influence
their partners’ mindsets (Parmigiani et al., 2011). Nevertheless, this
could be an issue of strategic planning to select the company’s partners
among organizations and people with the same mindsets regarding key
issues like AI deployment (Dacin et al., 1997).
4.1.7. Customers’ readiness
By customers’ readiness we do not mean that customers should be
ready to work with AI as “In most cases, customers will not know that
companies are operating AI” (R13). Rather, organizations should be ready
to deal with customers’ needs, privacy concerns, and in some cases,
acceptance towards AI as the respondent continued, “But what will help
us is identifying their needs and requirements to address those” (R13). Pri­
vacy and security problems regarding AI deployment in organizations
are not just related to legislators, but they could also raise concerns
among customers. Therefore, organizations should have a precise plan
to deal with the concerns of their customers. Otherwise, their business
may fall at risk easily. A manager of a financial service provider
elaborated:
Customers may have certain privacy and security concerns, espe­
cially in the banking space where consumer transactional data exists.
In this case, the company may need to take action and further
communicate with the customers to erase their concerns (R35).
Our respondents underlined the importance of considering cus­
tomers’ needs in deciding about using AI solutions. There are several
advantages of AI that can contradict customers’ wants and needs. For
example, AI can provide a high level of personalization and custom­
ization in products and services that can cause privacy concerns for
customers (Sundar and Marathe, 2010). However, as suggested by
marketing literature, customers should be considered the centre of
companies’ marketing activities and value creation processes (Latinovic
and Chatterjee, 2019). The corporate entrepreneur of an electronic ap­
pliances company headquartered in Germany said:
This technology [AI] does not work in your company, and a majority
of the technology fails, because we treat our customers as third
parties and we disregard their needs and wants. You want to make
use of this technology [AI] to make a profit for your company;
whereas, finally you will survive only if you meet your customers’
needs (R8).
As per our respondents’ notions, customers may not get informed of a
company’s using AI for their internal organizational affairs. However, if
AI is used in customers’ touchpoints (such as chatbots), customers will
notice. Therefore, companies must deal with the issue of customers’
acceptance of companies’ AI practices as one respondent said, “You
should identify your customers’ behaviours’ patterns, whether they are happy
to work on a bot and even to purchase any product from a bot” (R29).
Customers’ acceptance of tech-enabled practices is discussed in prior
research in the technology adoption realm (e.g., Kim et al., 2009), but it
has been mainly explored in business-to-customer studies. We add to the
readiness literature by identifying customers’ acceptance of companies’
AI practices as one determinant of organizational AIR.
4.1.8. Process readiness
Process readiness includes required mechanisms in the process of
operating work to facilitate AI use. Our data analysis identified three
dimensions of process readiness: operational integration, feedback
mechanism, and integrated communication. Operational integration
suggests that to leverage the value of AI, different teams and sectors
within an organization must work in an integrated way. This finding
supports Jackson’s (1999) research that highlights the role of opera­
tional integration in the process of organizational change. A senior
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Technovation 131 (2024) 102948
consultant of a famous financial services provider headquartered in the
UK declared:
Managers need to work in collaboration with the product team as
each product team knows their business better. To do so, managers
need to have all the operations integrated. Then, AI’s value could
take off among different teams and different operational sections of
the organization (R1).
Further, a feedback mechanism throughout organizations’ opera­
tions was often seen as key for AIR. This feedback could come from
different teams in an organization to modify AI to better meet their
needs or to improve AI’s performance. Reflecting this perspective, an
associate salesforce in an AI consulting organization headquartered in
the US pointed out, “Companies that make effective use of AI are the ones
that develop a culture and mechanism of providing feedback, as AI improves
when you have the feedback loop going into the system” (R10).
Integrated communication, the last identified mechanism of process
readiness, refers to a fluent and effective communication system
throughout an organization that prevents the system from any failure
related to lack of communication. Integrated communication was por­
trayed in the notions of one-third of managers. Also, our data show that
one key reason for AI failure is communication breakdown. The mar­
keting manager of an appliances manufacturer commented:
Projects often fail due to any communication breakdown. So, it
sounds like a solid to have the systems communicate effectively and
fluently with one another, which can be translated by an artificial
intelligence tool and then communicated to the end-users (R45).
With regard to the significance of integrated communication in or­
ganizations’ operations, Niemann-Struweg (2014) proposes a model of
integrated communication among an organization, its stakeholders, and
its business environment, and our findings add to this study by identi­
fying integrated communication among operational sectors within an
organization as a prerequisite to AI implementation. Table D in Ap­
pendix C demonstrates the criticality of factors identified in this study
gauged as the percentage of respondents that mentioned a specific
factor.
4.2. AI adoption strategies
In the third part of our interviews (as described in section 3.1), we
asked the managers about their strategies to adopt AI. Prior research
considers organizational readiness as a requirement for technology
adoption (e.g., Blut and Wang, 2020; Jöhnk et al., 2021). Therefore, to
make the most of their investment in AI, companies should define a clear
strategy for deploying it. The need for an AI adoption strategy is also
portrayed in the results of a survey by McKinsey & Company that found
the lack of a clear strategy for AI deployment the most important
obstacle for managers in adopting AI (Chui and Malhotra, 2018).
Therefore, we address this gap by exploring managers’ strategies for
implementing AI. Our data analysis identified five strategies for AI
adoption which were used either separately, together, or successively.
Some overlaps were found among those strategies but, in general, each
strategy follows a distinct procedure and logic. Table 3 demonstrates a
list of the identified strategies and their descriptions, along with more
important AIR dimensions related to them.
As demonstrated in Table 3, although all dimensions of AIR
mentioned by our respondents are important for a successful AI adop­
tion, some dimensions may matter more based on the selected adoption
strategy. These results were derived from our data based on each par­
ticipant’s emphasis on each AIR dimension as a requirement for the
given strategy. As a case in point, one of our respondents (R2) mentioned
that adopting the RPA strategy requires a high level of infrastructural
readiness, while another manager (R31) believes that the crawling
strategy eases the requirement for extensive financial and human re­
sources, and more requires managers’ readiness to start AI
A.N. Tehrani et al. Technovation 131 (2024) 102948

Table 3
AI adoption strategies.
Strategies Description Essential AIR dimensions Managerial Situational
strategy risk

1 Low-hanging Fruits Managers can start with areas which are ready and potent to use AI. This provides a • Informational Differentiation Low
quick win, so that the whole organization will have the confidence to move on to readiness
the other use cases. For instance, managers can automate some of their marketing o Use case
functions first, their operations next, then finance, then HR, and so forth. o Problem
recognition
• Data readiness
2 Robotic Process Managers can facilitate work flows with the help of robotic automation which is a • Environmental Cost reduction Low
Automation (RPA) safe investment. Although it needs a high amount of financial resources and readiness
infrastructure, robotic automation can drastically simplify operations, reduce o Culture
costs, and amplify efficiency. • Participants readiness
• Infrastructural
readiness
3 Crawling In terms of AI adoption, managers need to “crawl” before they can “walk.” That • Process readiness Differentiation High
means they can start with basic technology components with small use cases that o Feedback
have the least impact on their whole operations and needs the least investment. mechanism
Once managers get benefits from these small changes, they can go for more • Participants readiness
transformative technologies and greater use cases. o Managers
4 Guinea pigs Large organizations (e.g., banks) can let smaller and more agile companies (e.g., • Process readiness Cost reduction High
fintech companies) be the guinea pigs and experiment with AI implementation. o Integrated
Then, depending on the smaller companies’ success or failure, the large companies communication
can try to acquire the successful team or get into an alliance with them. o Operational
integration
• Participants readiness
o Managers
5 Partnership Managers can find the right technology partners (who have a competitive • Participants readiness Cost reduction High
advantage in the area of AI) at the start of their AI adoption. Then, over time, they o Partners
can build their capabilities more and learn from their partners. Also, they can often • Environmental
acquire needed data from a third-party company. readiness
o Regulatory
environment

implementation.
Our data also suggest that managers’ choice of AI adoption strategies
depends on their purpose for using AI in their operations and marketing
activities, as well as the level of risk associated with AI deployment.
Managers’ purposes for AI deployment can be broadly categorized into
the classic business strategies identified by Porter: cost leadership and
differentiation (Porter, 1997). Cost leadership strategies involve using
AI to streamline operations and reduce operational costs. On the other
hand, differentiation strategies aim to leverage AI to create unique and
innovative marketing approaches or enhance customer experiences. Our
finding aligns with other studies that emphasize the role of business
strategy (cost reduction vs. differentiation) and consequent managerial
goals in technology adoption success (Jeyaraj et al., 2006; Shrivastava,
1995).
Moreover, based on our respondents’ notions, we found that man­
agers’ AI strategy selection can be influenced by the level of general risk
Fig. 3. AI adoption strategies matrix.
of deploying AI in their organizations. Similarly, prior studies advise
that one factor that can influence technology adoption rate and de­
cisions is the level of risk (Grant et al., 2014) including technological impose more risk on the companies.
risk, financial risk, and risk of rejection by workers (Mitropoulos and
Tatum, 2000; Zirar et al., 2023). According to our qualitative analysis, 5. Discussion
we categorize AI adoption strategies in a two-by-two matrix, as dis­
played in Fig. 3. However, there could be overlaps among the identified We developed and empirically investigated the organizational AIR
strategies and the criteria of strategy selection. concept. To achieve conceptual clarity surrounding the AIR concept, we
One example scenario in Fig. 3 is that when managers aim to used a multi-theoretical approach. Specifically, to define and concep­
implement AI for differentiation in a high-risk condition, they can adopt tualize the AIR construct, we integrated the organizational readiness for
the crawling strategy. Crawling strategy, as described in Table 3, refers change and work system framework (Weiner 2009; Alter 2013).
to deploying a small amount of AI to safely assess its value, functionality, Together, these theoretical perspectives enabled us to approach the
and consequences. Then, after acquiring some confidence and infor­ intricate and multifaceted nature of AIR from different angles, offering a
mation along those, managers can continue with more cost-intensive more comprehensive and nuanced understanding of the topic. The
and critical use cases of AI within their organization. When it comes organizational readiness for change lens assisted us in comprehending
to adopting AI in a high-risk situation (in cases of crawling, guinea pigs, how organizations prepare for and adapt to changes, such as AI adop­
and partnership strategies), technology integration is an important tion, while the work system framework provided a structured frame­
consideration. That means, managers should deploy AI solutions that work for categorizing the dimensions and sub-dimensions that
integrate well with their existing technology, as too many changes may constitute the AIR construct.

12
A.N. Tehrani et al.
We conducted an empirical qualitative study to unveil the capabil­
ities and resources needed for an organization to get AI-ready. Providing
conceptual clarity and a more nuanced exploration of what determines
AI readiness matters more and more. According to McKinsey & Com­
pany, around 50% of companies have already embedded AI into mul­
tiple sectors while many managers still struggle with the decision of
whether or not to adopt AI. We respond to several calls for research to
identify the key resources and capabilities that organizations need to
implement and make the most of AI solutions (Ågerfalk, 2020). Specif­
ically, we present eight dimensions of AIR including informational
readiness, environmental readiness, infrastructural readiness, partici­
pants’ readiness, process readiness, customers’ readiness, data readi­
ness, and technological readiness. We also identify the sub-dimensions
for each dimension of AIR providing a nuanced understanding of AIR
construct. Also, our study helps bridge the gap between organizations’
readiness achievement and the adoption of AI since it identifies five
distinct strategies that managers can apply to adopt AI. In the following
section, we summarize the contributions of our research to theory and
practice and provide future research opportunities.
5.1. Theoretical contributions
This study makes several key contributions to the literature. First, we
provide an empirical and theoretical conceptualization of AIR. While
other definitions of technology readiness exist, AIR has received little
attention. We have identified this shortcoming across AI research in
marketing (Huang and Rust, 2021; Wirth, 2018), operations manage­
ment (Raisch and Krakowski, 2021), and information systems (Ågerfalk,
2020; Mousavi et al., 2020). More importantly, we help address this gap,
and, based on the pertinent literature and our empirical research, we
define AIR as the state of an organization in terms of willingness and ability
of its stakeholders, and suitability of its environment, processes, data and
resources for adopting and operating AI. To date, most research on various
AI-related aspects focuses on operational AI aspects such as compati­
bility, usefulness, and ease of use rather than what capabilities organi­
zations need to get ready to adopt AI (e.g., Belanche et al., 2019; Pillai
et al., 2021). To address this gap, we use the definition of organizational
readiness for change that postulates that readiness stems from the
cognitive, emotional, and behavioural preparedness of an organization
towards a new practice (Weiner, 2009). In our definition, we consider
cognitive and emotional preparedness as willingness and behavioural
preparedness as ability. In providing this definition, we add conceptual
clarity to the literature on AI and related information technology as well
as more clarity on what it takes to get AI-ready.
Second, our work supports existing studies that treat organizational
readiness as residing on a continuum (Klein and Kozlowski, 2000;
Weiner et al., 2008). Prior research suggests that the state of readiness is
not an either-or notion (ready or not ready), and it should be considered
as a degree of readiness instead (Weiner, 2009). It matters mainly
because assessing the degree of readiness can offer continuous guidance
on better allocating resources toward AI. We add to this literature by
shedding light on the level of readiness for AI by identifying eight cat­
egories of AIR determinants each of which can account for some extent
of the whole AIR degree when operationalized.
Third, based on the literature and our data analysis, we propose a
typology of five AI adoption strategies along two ascertained di­
mensions: managerial goals and the level of risk of AI adoption in the
organization. This typology contributes to the body of knowledge on
technology adoption strategy by explaining its germane contingency
factors that matter in understanding the boundary conditions of AI
adoption strategies (Edmondson and McManus, 2007). Introducing and
defining those AI adoption strategies matters since, to date, research on
technology adoption mostly focuses on antecedents of successful AI
adoption (e.g., Belanche et al., 2019; Pillai et al., 2021) and barriers to
adopting new technologies (e.g., Chaouali and Souiden, 2019; Chouk
and Mani, 2019). However, the transition phase from readiness to
13
Technovation 131 (2024) 102948
adoption—which entails choosing an adoption strategy—is usually
neglected (Blut and Wang, 2020; Jöhnk et al., 2021).
5.2. Managerial implications
We offer guidance to decision makers in managing their organiza­
tions’ AI adoption judiciously by providing them with the concept of AIR
which highlights some of the areas that are often responsible for keeping
managers from making the most of their AI investments. Specifically,
this study suggest eight AIR dimensions that—once translated into
actionable tactics—can potentially help managers boost the return of
their AI investments. That is, based on an AI readiness assessment ac­
cording to our study’s results, managers could reflect and adapt the el­
ements to their organizational needs and identify where they fall short.
Our data suggest that it would be beneficial for managers to compare
their organizational capabilities and abilities with the eight dimensions
of AIR to improve how ready they are in terms of their processes,
infrastructure, participants, customers, technologies, and so forth.
Therefore, our findings can assist managers in identifying their priorities
in terms of their resource allocation to improve the success of their AI
investment.
Further, our results assist managers in planning their AI adoption by
providing them with several AI adoption strategies. We guide decision
makers on what AI use cases and how much AI they should start with
subject to various contextual factors. Based on their objectives for
adopting AI as well as the level of risk of using AI, managers can come up
with suitable AI adoption strategies. For instance, if a manager’s goal is
to gain a more competitive advantage and boost their revenue through
AI (the vertical axis in Fig. 3), they have at least two key options: low-
hanging fruits and crawling strategy (the first row in Fig. 3 matrix).
Then, they could consider the general level of risk of using AI in their
organization including technological risk, financial risk, regulatory risk,
and risk of rejection by workers (the horizontal axis in Fig. 3). If they
find that the general level of risk of AI adoption in their organization or
the industry in which they operate is low, they can preferably adopt a
low-hanging fruit strategy, which guides them to start with the most
potent and easier-to-catch use cases. If the level of risk is high, they can
adopt the crawling strategy and start with smaller use cases to minimize
risk and gain experience.
5.3. Limitations and directions for future research
Our study’s limitations offer several future research opportunities.
While the study at hand makes a potentially valuable contribution to our
understanding of AIR and associated strategies, it is vital to recognize
that the AIR dimensions and associated strategies warrant further
exploration and empirical testing. Specifically, future research should
delve deeper into whether the proposed AI dimensions are indeed
distinct or highly correlated with one another. It is plausible that some
AIR dimensions overlap, such as informational readiness and data
readiness, or technological and infrastructural readiness. Clearly, much
of what we found would benefit from practical validation and empirical
testing.
Future research should operationalize the construct of AIR along its
dimensions and further quantitatively test its influence on other key
variables of technology adoption theories like successful implementa­
tion, AI performance, and financial performance. Following efforts to
operationalize AIR, it should be tested through quantitative studies. One
potentially invaluable pursuit of possible future quantitative studies is
ranking AIR dimensions in terms of their importance to organizations as
it is likely that some AIR dimensions will be more significant than others
depending on various contextual factors. For example, customers’ pri­
vacy might be more critical in the banking industry than in food and
entertainment (Lwin et al., 2007; Mattila et al., 2003). After all, oper­
ating in different industries and contexts requires different organiza­
tional capabilities and resources (Eisenhardt and Martin, 2000).
A.N. Tehrani et al. Technovation 131 (2024) 102948

Therefore, future research should contextualize and re-conceptualize 6. Conclusion

the sub-dimensions of AIR across different industries and perhaps
different countries too in an effort to rank and prioritize the dimensions
and sub-dimensions of AIR.
Future research could also test our findings with organizations that
have struggled to adopt AI technology, possibly even discontinuing its
use. While a handful of studies explore the diminishing adoption of
various technology-based platforms (e.g., Power and Gruner, 2015),
delving into this domain—especially concerning discontinued AI adop­
tion—remains a fruitful research terrain. Also, a comparison between
successful and unsuccessful AI adoption in different organizations could
help identify the factors that prevent companies from becoming truly
AI-ready (cf. D’Aveni and MacMillan, 1990).
In addition, based on our purposive interview sample, our findings
mainly reflect the perspectives of key informants in various leading
management positions. That is, participants such as office staff or IT
support personnel were not included in our study. Thus, the perspectives
of those staff who often work directly with AI technologies and pro­
cesses, and thus may hold unique insights were not captured in our
work. Indeed, we recommend conducting a more inclusive data collec­
tion that involves a wide range of participants, including internal and
external stakeholders.
Deploying AI in organizations appears to be an effective strategy for
reducing operational costs, increasing revenue, and generating greater
overall value. However, the importance of organizations’ readiness to
use AI and maximize its capabilities is often overlooked. Our emergent
model of organizational AI readiness offers a novel theoretical founda­
tion for investigating the prerequisites for businesses to become AI-
ready and strategies for managing their AI adoption.
7. Funding details
This work was supported by the University of Western Australia.
Declaration of competing interest
The authors report there are no competing interests to declare.
Data availability
The data that has been used is confidential.

Appendix A
Table A
Description of Our Study Participants

Head office Industry Respondent’s role Respondent’s sex CODE Interview duration

Europe Financial consulting services Senior consultant M R1 40:34

Consulting services Intelligent Automation and process manager M R2 50:32
IT and ICT Product manager F R3 50:00
Health products Regional manager M R4 38:35
Clothing Ecommerce planner and controller M R5 41:15
Consulting services Senior manager M R6 45:57
Photography Managing director M R7 52:40
Electronic appliances Corporate entrepreneur M R8 1:15:12
America Consulting services Product manager M R9 57:30
AI consulting services Associate salesforce M R10 42:35
Retailing Manager F R11 45:14
IT and ICT Product development manager M R12 39:08
IT and ICT Senior cognitive consultant M R13 1:12:10
IT and ICT Program manager F R14 47:50
Food Sales manager F R15 47:16
Analytics services Director of customer success M R16 42:56
Consulting services Manager M R17 43:44
Financial services Assistant vice president M R18 31:00
Asia and Oceania Financial services Manager M R19 1:12:04
Electronic appliances Regional sales manager M R20 1:41:00
Hospitality service CEO-Founder M R21 1:00:00
Financial services Head of innovation & future technologies M R22 1:49:18
Digital marketing services Manager M R23 1:04:00
Financial services Chief marketing officer M R24 36:46
Financial services Regional manager M R25 49:20
Paint manufacturing Manager F R26 1:02:43
IT and ICT Founder & CEO M R27 30:00
IT and ICT Manager M R28 1:01:12
Health care services Medical director M R29 1:15:00
IT and ICT Marketing head M R30 41:00
Digital marketing services Founder & CEO M R31 38:56
Financial services Manager M R32 52:00
IT and ICT Manager F R33 54:50
Media CEO M R34 58:00
Financial services Manager M R35 45:29
IT and ICT Vice president M R36 43:31
IT and ICT Manager M R37 40:47
Engineering and design services Solutions developer M R38 1:14:00
Entertainment Senior product manager M R39 46:00
Food Manager M R40 54:08
Hospitality service Co-founder M R41 44:50
logistic services CEO M R42 50:25
IT and ICT Assistant manager F R43 38:30
(continued on next page)

14
A.N. Tehrani et al. Technovation 131 (2024) 102948

Table A (continued )
Head office Industry Respondent’s role Respondent’s sex CODE Interview duration

IT and ICT Project manager M R44 55:32

Electronic appliances Marketing manager F R45 47:35
Consulting services Lead generation executive F R46 1:20:15
IT and ICT Senior software engineer M R47 1:00:46
Retailing Staples head M R48 42:56
Electronic appliances Product manager F R49 59:30
Food CEO M R50 36:32
Oil and energy CEO M R51 40:19
Hospitality service Assistant sales manager M R52 45:39

Appendix B. Quotes
Table B
Specifications of organizational culture and pertinent quotes

Specifications of Organizational Quote

Culture

Collaboration “I think, if I have to link work culture with AI adoption, the key is collaboration among workers” (R33).
Openness “Our strength was that we had a culture wherein everybody was open to moving towards that” (R23).
Tech-friendliness “If your staff are not tech-savvy, firstly the response is, ‘I don’t want to do it.’ And secondly, the resistance to change will always be there. So, first,
you should evaluate how tech-friendly your staff is” (R36).
Competitiveness “I don’t think AI can be easily deployed in every organization as this is a cultural change, a digital transformation. It depends on your overall
company’s competitiveness culture, and this is the unique difference that you are going to create” (R8).
Willingness to learn “It is a very young company and people love to work around new technologies and they are willing to learn. This is the most exciting trait among
all my employees in my organization” (R28).

Table C
Quotes related to tools and IT resources

Tools and IT resources Quote

Storage capacity, computing capacity, “Highly flexible IT tools and a high capacity are needed to implement AI. The existing tools cannot be used where we target to use AI.
scalability, and security (…) Besides, we also need high computing capacity, high storage capacity, and low latency infrastructure” (R2).
“Basically, high computing capacity, for example, GPUs, can accelerate the deep learning process by 100 times compared to the
traditional CPUs” (R5).
“Companies are exposed to more data. So, the database grows over time and companies need to increase their capacity and plan for
expansion. (…) You may have the suitable tools now, but AI implementation is not a short plan, and you shouldn’t get weak on it
over time. So, scalability must be a high priority for your tools and networks” (R52).
“I remember [our company]1 leaked credit card information of many users long back. Data leakage could damage your image and
reputation in the market. Your IT infrastructure should be secure from end to end” (R2).
1
Name of the company is purposefully eliminated to ensure anonymity and confidentiality.

Appendix C
Table D
The criticality of identified factors

Identified factor Criticality of the factor

Environmental readiness
Organizational culture 56%
Regulatory environment 35%
Leadership 40%
Technological readiness
IT support 48%
Techniques 40%
Technological maturity 17%
Informational readiness
AI use cases 53%
Problem recognition 38%
AI solutions 31%
Infrastructural readiness
Financial resources 78%
Human resources 100%
IT resources 48%
Data readiness
Data availability and access 67%
Data quality 78%
Data volume 84%
Participants’ readiness
Managers 73%
(continued on next page)

15
A.N. Tehrani et al. Technovation 131 (2024) 102948

Table D (continued )
Identified factor Criticality of the factor

Partners (other stakeholders) 40%

Staff 77%
Customers’ readiness
Acceptance 32%
Customers’ needs 11%
Privacy and security concerns 25%
Process readiness
Operational integration 15%
Feedback mechanism 15%
Integrated communication 32%

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