Applications of generative AI and future organizational performance: The mediating role of explorative and exploitative innovation and the moderating role of ethical dilemmas and environmental dynamism

Generative Artificial Intelligence (GenAI) is one of the popular AI technologies which can produce multiple kinds of contents including music, text, image, as well as synthetic data. As GenAI technology can produce various forms of contents, organizations must face ethical dilemmas as to where this technology is likely to be used. Organizations do not want to compromise their ethical standards and compliance policies. Against this backdrop, the aim of this study is to examine if GenAI technology could improve the future performance of the organizations. This study deployed ethical dilemmas and environmental dynamism as two moderators acting on different linkages between adoption of GenAI and organizational future performance. With the help of literature review and theories, a theoretical model has been developed conceptually which was validated using PLS-SEM technique with the feedback of 326 responses from different types of organizations. This study found that the adoption of GenAI could improve exploratory and exploitative innovation under the moderating effects of environmental dynamism and ethical dilemmas. Moreover, it highlighted that the application of GenAI could improve organizational performance.