Challenges of smaller entrepreneurial enterprises aiming to generate higher values by adopting artificial intelligence (AI) and competing in the rapidly evolving AI industry

Hamid Etemad ()
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Hamid Etemad: McGill University

Journal of International Entrepreneurship, 2024, vol. 22, issue 3, No 1, 269-287

Abstract: Abstract The rapid introduction of artificial intelligence (AI) by highly capable firms has changed the nature of global competition and the rapidly evolving ecosystem, which have made it harder for small and medium-sized international enterprises (iSMEs) to enter the AI industry and compete globally. This article examines the journey of an entrepreneurial firm’s challenges in gaining higher global competitiveness by augmenting its current conventional strategic capabilities by adding AI to its existing capabilities. The focal case study also demonstrates that adopting AI capabilities (and expertise) needs pre-training to support its AI capabilities to predict focal artifacts or phenomena, to generate potent strategic solutions to resolve the challenges facing its clients, or to exploit potential opportunities. This research is based on an in-depth longitudinal case study of a firm attempting to add AI capabilities to gain higher global competitiveness for higher growth internationally. Initially, it attempted to identify the potential causes of defects in airplanes causing partial or total failure. Due to operational difficulties, it re-focused on two other opportunities, before achieving success in identifying the actual beginning and potential causes of pre-mature roof failures in high-rise commercial buildings in highly damaging and harsh environmental conditions that made repairing or replacing damaged roofs costly, dangerous, and time-consuming. However, it took the firm relatively long experiential learning to succeed in fine-tuning its technologies through pre-training of its AI capabilities to generate reliable results for saving costs, damages, discomforts, and time and generating higher values. The comparative and longitudinal analysis of the focal firm in this article points to the management of other successful firms in the AI industry posing to potent adverse forces, and insurmountable challenges for smaller entrepreneurial firms aspiring to succeed in gaining more competitiveness in the global AI industry unless they start prudently early on and upgrade their capabilities continually to remain competitive. The cautionary conclusion of this article provides both instructive and precautionary lessons for aspiring iSMEs in analyzing potentially difficult challenges before entering and committing to actively compete in the rapidly evolving AI industry, although AI-based generative recommendation can provide transformative solutions for resolving difficult challenges.

Keywords: AI; Competition in rapidly advancing technologies; Collaborative networks; Consumer/client perceive values; Generative AI; GPT AI; Machine learning; Technological race in newly emerging industries; Strategic pivots (search for similar items in EconPapers)
Date: 2024
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DOI: 10.1007/s10843-025-00385-w

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