Examining the Role of AI-Augmented HRM for Sustainable Performance: Key Determinants for Digital Culture and Organizational Strategy

Abstract

In the wave of digitalization, organizations are increasingly focused on whether to prioritize digital culture or organizational strategy for the use of artificial intelligence (AI); there are mixed opinions, particularly when AI-augmented HRM draws attention as a tool for achieving sustainable organizational performance (SOP) in developing countries. This study aims to explore the influence of digital culture and organizational strategy on AI-augmented HRM and SOP, focusing on the mediating role of AI-augmented HRM in these relationships. To investigate the hypothesized relationships, 219 sample data were gathered from employees associated with HRM-oriented activities in Bangladesh, and SPSS 23 and AMOS software were used to test the SEM model. The results proved that digital culture has an insignificant effect and organizational strategy has a significant effect on AI-augmented HRM, and AI-augmented HRM has a substantial effect on SOP and partially mediates the relationship between organizational strategy and SOP. Based on the results, we infer that the successful implementation of AI-augmented HRM can lead to organizational sustainability in developing countries, where organizational strategy plays a pivotal role rather than digital culture. This research incorporates the resource-based view (RBV) and dynamic capabilities theories, which are crucial for the groundbreaking development of the research model. The results suggest that managers and responsible authorities should prioritize organizational strategy over digital culture when implementing AI-augmented HRM systems to ensure sustainability in developing countries. However, in the long run, organizations also need to concentrate on generating digitally favorable environments.