Artificial intelligence capability and project performance: integrating dynamic capabilities theory and the knowledge-based view
TL;DR
The findings indicate that AI capability positively influences knowledge integration, project agility, and project performance, and that AI capability improves project performance by strengthening knowledge integration, which subsequently enhances project agility.
Abstract
Artificial intelligence (AI) is transforming project management by enhancing organizational decision-making and operational efficiency. However, the organizational mechanisms through which AI capability improves project performance remain insufficiently understood. Drawing upon dynamic capabilities theory and the knowledge-based view, this study examines the direct effect of AI capability on project performance and investigates the mediating roles of knowledge integration and project agility. Data were collected from 267 project-based organizations operating in Turkey using a two-wave survey with a four-month interval between data collection waves. Confirmatory factor analysis (CFA) was employed to assess the reliability and validity of the measurement model. The proposed hypotheses were tested using hierarchical regression analysis, bootstrapping procedures, structural equation modeling (SEM) for robustness analysis, and two-stage least squares (2SLS) estimation to address potential endogeneity. The findings indicate that AI capability positively influences knowledge integration, project agility, and project performance. Knowledge integration significantly enhances both project agility and project performance, while project agility has the strongest direct effect on project performance. The bootstrapping analysis further demonstrates that knowledge integration and project agility partially mediate the relationship between AI capability and project performance. Moreover, the sequential mediation results reveal that AI capability improves project performance by strengthening knowledge integration, which subsequently enhances project agility. This study contributes to the project management and AI literature by integrating dynamic capabilities theory and the knowledge-based view within a unified framework to explain how AI capability is transformed into superior project performance. By identifying knowledge integration and project agility as complementary organizational mechanisms, the study offers a more comprehensive explanation of AI-enabled project success and provides valuable theoretical and managerial insights for organizations seeking to improve project outcomes through AI capability.
