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The nexus of managerial and technical AI knowledge, disruptive innovation and the circular economy: The role of organizational change capability and financial resilience

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  • Al Halbusi, Hussam
  • Popa, Simona
  • Soto-Acosta, Pedro
  • Alshallaqi, Mohammad

Abstract

Drawing on the dynamic capabilities theory, this study investigates how managerial and technical artificial intelligence (AI) knowledge influence disruptive innovation and its impact on the circular economy. It also examines the moderating effects of organizational change capability and financial resilience on the relationship between disruptive innovation and the circular economy. The proposed model and its associated hypotheses were tested using Partial Least Squares (PLS) structural equation modeling (SEM). This study is based on two-wave data collected from 242 general, IT, and operations managers in firms located within a central hub for the technology and manufacturing industries in Baghdad. The findings indicate that managerial and technical AI knowledge significantly boost disruptive innovation, which, in turn, enhances the circular economy. Moreover, organizational change capability and financial resilience strengthen the relationship between disruptive innovation and the circular economy. This research contributes to the field of AI capabilities by highlighting their role in fostering disruptive innovation and promoting sustainability through the circular economy. Additionally, it provides insights into how organizational and financial resilience, alongside AI skills and knowledge, can support sustainable business models. Practically, the study underscores the necessity for technology and manufacturing companies to invest in both managerial and technical AI skills while prioritizing robust organizational change capabilities and financial resilience to maximize the benefits of disruptive innovation and support a circular economy.

Suggested Citation

  • Al Halbusi, Hussam & Popa, Simona & Soto-Acosta, Pedro & Alshallaqi, Mohammad, 2025. "The nexus of managerial and technical AI knowledge, disruptive innovation and the circular economy: The role of organizational change capability and financial resilience," Technology in Society, Elsevier, vol. 82(C).
    • Handle: RePEc:eee:teinso:v:82:y:2025:i:c:s0160791x25001277
    DOI: 10.1016/j.techsoc.2025.102937
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