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All Journal Proceeding of Undergraduate Conference on Literature, Linguistic, and Cultural Studies
Nurhamam, Zaki
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Humanities Education Languange, Linguistic, Communication & Media

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Strategic Integration of Artificial Intelligence: The Mediating Role of Dynamic Capabilities and Moderating Influence of Environmental Turbulence in Developing Economies Bagis , Fatmah; Hasmi , Maria; Pratamasari , Mega Aprillia; Prayoga, Ogun; Nurhamam, Zaki
Proceeding of Conference on Literature, Linguistic, and Cultural Studies Vol. 5 No. 1 (2026): Proceeding of Conference on Literature, Linguistic, and Cultural Studies: ICONE
Publisher : Fakultas Ilmu Budaya Universitas 17 Agustus 1945 Surabaya

Show Abstract | Download Original | Original Source | Check in Google Scholar | DOI: 10.30996/pcllcs.v5i1.6570

Abstract

This research investigates how organizations in developing nations focusing on Indonesia can effectively embed Artificial Intelligence (AI) into their strategic operations to boost competitiveness and support the achievement of Sustainable Development Goals (SDGs). Drawing upon Dynamic Capability Theory (DCT) and the Technology-Organization-Environment (TOE) framework, the study examines the role of AI readiness in fostering strategic AI integration, with dynamic capabilities acting as a mediating mechanism and environmental turbulence serving as a moderating factor. A survey of 150 industry managers in Central Java was conducted, with data analyzed using the Partial Least Squares–Structural Equation Modeling (PLS-SEM) approach. Results indicate that organizations with higher AI readiness tend to develop stronger dynamic capabilities, which subsequently enhance their strategic integration of AI. Additionally, the study finds that environmental turbulence can amplify or diminish the influence of dynamic capabilities. Theoretically, the research extends the TOE framework by incorporating dynamic capability perspectives, while practically offering guidance for business leaders and policymakers aiming to implement AI in ways that are both effective and sustainable.
Co-Authors Bagis , Fatmah Hasmi , Maria Pratamasari , Mega Aprillia Prayoga, Ogun