How do innovations generated by AI differ qualitatively from traditional innovations and what are the consequences for a firm's competitive positioning?

How do innovations generated by AI differ qualitatively from traditional innovations and what are the consequences for a firm's competitive positioning? | Research Square window.SnipcartSettings = { analytics: { enabled: false } }; (function() { var accessVector = localStorage.getItem('access_vector') || ''; window.dataLayer = window.dataLayer || []; if (accessVector) { window.dataLayer.push({ user: { profile: { profileInfo: { snid: accessVector } } } }); } })(); (function(w,d,s,l,i){w[l]=w[l]||[];w[l].push({'gtm.start':new Date().getTime(),event:'gtm.js'});var f=d.getElementsByTagName(s)[0],j=d.createElement(s),dl=l!='dataLayer'?'&l='+l:'';j.async=true;j.src='https://www.googletagmanager.com/gtm.js?id='+i+dl;f.parentNode.insertBefore(j,f);})(window,document,'script','dataLayer','GTM-K279D39R'); Browse Preprints In Review Journals COVID-19 Preprints AJE Video Bytes Research Tools Research Promotion AJE Professional Editing AJE Rubriq About Preprint Platform In Review Editorial Policies Our Team Advisory Board Help Center Sign In Submit a Preprint Cite Share Download PDF Research Article How do innovations generated by AI differ qualitatively from traditional innovations and what are the consequences for a firm's competitive positioning? Saeed Mousa This is a preprint; it has not been peer reviewed by a journal. https://doi.org/ 10.21203/rs.3.rs-6963219/v1 This work is licensed under a CC BY 4.0 License Status: Posted Version 1 posted You are reading this latest preprint version Abstract Artificial intelligence (AI) is transforming how firms innovate, offering new ways to enhance decision-making, accelerate processes, and personalize customer experiences. While prior research has emphasized the quantitative benefits of AI—such as efficiency gains and cost reduction—this study focuses on the qualitative differences between AI-led and traditional innovation. Based on 35 expert interviews and 20 cross-sector case studies, we identify five qualitative dimensions distinguishing AI-led from traditional innovation: speed, scalability, efficiency, personalization, and creativity. The findings reveal that innovation is increasingly shaped by hybrid systems combining AI capabilities with human judgment and imagination. To conceptualize this transformation, we propose a sociotechnical hybrid innovation model, framing AI innovation as an outcome of interaction between technical and human subsystems. This model advances innovation theory by emphasizing co-creativity and ethical integration, and offers practical guidance for firms seeking to balance automation with human-centered design. The study contributes to both strategic management and innovation literature by illustrating how AI not only augments existing processes, but redefines the logic of innovation itself. Other Economics Artificial Intelligence Competitive Advantage Hybrid Innovation Model Sociotechnical Systems Dynamic Capabilities AI-Driven Innovation Full Text Additional Declarations The authors declare no competing interests. Cite Share Download PDF Status: Posted Version 1 posted You are reading this latest preprint version Research Square lets you share your work early, gain feedback from the community, and start making changes to your manuscript prior to peer review in a journal. As a division of Research Square Company, we’re committed to making research communication faster, fairer, and more useful. We do this by developing innovative software and high quality services for the global research community. Our growing team is made up of researchers and industry professionals working together to solve the most critical problems facing scientific publishing. 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