AI knowledge capability and innovation: the power of cognitive processing and empowerment

Purpose This study aims to integrate ideas from organizational learning theory with new AI capabilities to investigate how AI-driven knowledge processes may improve innovation performance. Specifically, this study explores the process in which AI-based (AI Ba) knowledge production and integration support advancement of AI knowledge capability and AI psychological empowerment. In addition, this study also investigates the moderating role of Gen-AI cognitive. Design/methodology/approach Data were collected from 301 professionals in the USA working in AI-enabled organizational settings, and structural equation modeling was used for data analysis. Findings The results of this study show that both AI knowledge production Ba and AI knowledge integration Ba is positively associated with AI knowledge capability and AI psychological empowerment. AI knowledge capability is also positively related to AI innovation performance. Similarly, AI psychological empowerment is also significantly related to AI innovation performance. Furthermore, the findings of this study show that Gen-AI cognitive processing positively moderates the association between AI knowledge capability and AI innovation performance, while Gen-AI cognitive processing did not moderate the relationship between AI psychological empowerment and AI innovation performance. Originality/value Overall, this study contributes to the literature by providing an extensive framework for linking AI-enabled knowledge processes to psychological and performance consequences. This study also has practical implications for organizations attempting to use AI capabilities to drive creativity, highlighting the relevance of cognitive and psychological factors in AI adoption.