The Role of Artificial Intelligence in Enhancing Decision-Making in Pakistani Operations

Abstract

This study examines how Artificial Intelligence (AI) can be used to improve the decision-making process in Pakistani organizations, which is mediated by organizational preparedness and moderated by the leadership type. A quantitative research design was to be used and survey findings were obtained through 250 managers in the banks, healthcare and manufacturing industries. Correlation and regression analyses with the help of SPSS 28 have verified that the effect of AI adoption on the rate, accuracy, and reliability of making decisions is significantly positive (0.42, p <.001). Further, using mediation analysis, the authors found that the relationship between AI benefits and organizational readiness is partially mediated by the appropriate infrastructure, training, and cultural preparedness (indirect effect = 0.19, p <.01). Also, the moderation test showed that transformational leadership enhances the relationship between AI and decision making but there is a weaker effect of transactional leadership on the same (interaction term = 0.15, p < .05). The findings underscore the fact that the implementation of AI does not automatically lead to effective decisions, and the success of AI implementation is determined by whether an organization is ready or not and the supportive leadership. The research gives a contribution to the social-technical systems theory and provides practical implications to Pakistani organizations and policymakers in an attempt to optimize the influence of AI.