AI-Driven Leadership: A Study on Effectiveness and Challenges

Abstract

Integration of artificial intelligence in organisational leadership has proven to be one of the most significant trends in modern management. This paper researched the efficacy of AI-driven leadership and the obstacles to it with special consideration to the managers and professionals who work in AI-integrated organisations in Lahore, Pakistan. The study took a quantitative explanatory design, purposive sampling was used to recruit 250 respondents who were given a self-administered structured questionnaire to fill. The proposed conceptual model placed AI-based leadership as an independent variable, leadership efficacy as a dependent one, the quality of decision-making as a mediating factor, and technological preparedness and ethical issues as moderators. Data analysis was done by descriptive statistics, reliability analysis, correlation analysis and Structural Equation Modeling (SEM) to test the hypothesised mediation and moderation effects. The results showed that AI-based leadership had a huge positive impact on leadership performance, and the correlation was greatly moderated by the quality of decisions. The positive correlation between AI-driven leadership and quality of decision-making was reinforced by technological preparedness and reduced by high ethical issues. The research is relevant to the developing body of literature on AI in management and provides an effective piece of advice to organisations in Pakistan and other similar developing economies that are aiming to apply AI tools in responsible and effective ways to leadership.