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      Artificial Intelligence and Reduced SMEs’ Business Risks. A Dynamic Capabilities Analysis During the COVID-19 Pandemic

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      1 , 2 , 3 , 4 , 5 ,
      Information Systems Frontiers
      Springer US
      SMEs, Business Risks, COVID-19 pandemic, Artificial Intelligence, Dynamic Capabilities

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          Abstract

          The study utilises the International Labor Organization’s SMEs COVID-19 pandemic business risks scale to determine whether Artificial Intelligence (AI) applications are associated with reduced business risks for SMEs. A new 10-item scale was developed to capture the use of AI applications in core services such as marketing and sales, pricing and cash flow. Data were collected from 317 SMEs between April and June 2020, with follow-up data gathered between October and December 2020 in London, England. AI applications to target consumers online, offer cash flow forecasting and facilitate HR activities are associated with reduced business risks caused by the COVID-19 pandemic for both small and medium enterprises. The study indicates that AI enables SMEs to boost their dynamic capabilities by leveraging technology to meet new types of demand, move at speed to pivot business operations, boost efficiency and thus, reduce their business risks.

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          Most cited references165

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          Explicating dynamic capabilities: the nature and microfoundations of (sustainable) enterprise performance

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            Dynamic capabilities: what are they?

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              Representation learning: a review and new perspectives.

              The success of machine learning algorithms generally depends on data representation, and we hypothesize that this is because different representations can entangle and hide more or less the different explanatory factors of variation behind the data. Although specific domain knowledge can be used to help design representations, learning with generic priors can also be used, and the quest for AI is motivating the design of more powerful representation-learning algorithms implementing such priors. This paper reviews recent work in the area of unsupervised feature learning and deep learning, covering advances in probabilistic models, autoencoders, manifold learning, and deep networks. This motivates longer term unanswered questions about the appropriate objectives for learning good representations, for computing representations (i.e., inference), and the geometrical connections between representation learning, density estimation, and manifold learning.
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                Author and article information

                Contributors
                nick.drydakis@aru.ac.uk
                Journal
                Inf Syst Front
                Inf Syst Front
                Information Systems Frontiers
                Springer US (New York )
                1387-3326
                1572-9419
                4 March 2022
                : 1-25
                Affiliations
                [1 ]GRID grid.5115.0, ISNI 0000 0001 2299 5510, School of Economics, International Business and Law, Centre for Pluralist Economics, Faculty of Business and Law, , Anglia Ruskin University, ; East Road, Cambridge, CB 1 1PT UK
                [2 ]GRID grid.5335.0, ISNI 0000000121885934, Pembroke College, University of Cambridge, ; Cambridge, UK
                [3 ]GRID grid.5335.0, ISNI 0000000121885934, Centre for Science and Policy, , University of Cambridge, ; Cambridge, UK
                [4 ]Global Labor Organization, Essen, Germany
                [5 ]GRID grid.424879.4, ISNI 0000 0001 1010 4418, Institute for Labor Economics, ; Bonn, Germany
                Author information
                http://orcid.org/0000-0001-9827-6678
                Article
                10249
                10.1007/s10796-022-10249-6
                8893980
                a9db132f-7ba1-4318-89bb-d3fb2e39b2ce
                © The Author(s), under exclusive licence to Springer Science+Business Media, LLC, part of Springer Nature 2022

                This article is made available via the PMC Open Access Subset for unrestricted research re-use and secondary analysis in any form or by any means with acknowledgement of the original source. These permissions are granted for the duration of the World Health Organization (WHO) declaration of COVID-19 as a global pandemic.

                History
                : 19 January 2022
                Categories
                Article

                smes,business risks,covid-19 pandemic,artificial intelligence,dynamic capabilities

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