Artificial Intelligence Adoption and Employee Productivity: The Mediating Role of Digital Competence

Abstract

In the workplace, artificial intelligence (AI) is rapidly becoming a staple, but the benefits it delivers in productivity vary from organization to organization. The present study investigated the association between the AI adoption and employee productivity mediated by digital competence. A quantitative research design was used and 300 employees of both the private and public sectors organizations completed the structured questionnaire with a five-point Likert scale. Descriptive analyses, correlation analysis, regression analysis and mediation analysis (using Hayes' (2013) PROCESS Model 4 with bootstrapping) were performed on the data. The findings revealed that the adoption of AI had a significant positive impact on employee productivity as well as digital competence; digital competence had a significant positive impact on productivity. The relationship between AI adoption and productivity was partially mediated by digital competence, suggesting that the impact of AI on productivity is partly attributable to the increased benefits of using AI tools that contribute to digital competence. The study relates the research on the technology adoption to the research on work-performance and recommends using AI deployment in conjunction with continuous digital skills development.