Abstract

This study examined the effect of artificial intelligence (AI) adoption on the growth of service business organizations in South-East Nigeria and investigated the moderating role of employee technology readiness in this relationship. The accelerating diffusion of AI across global service industries, coupled with persistent gaps in digital readiness within emerging economies, motivated the inquiry. Anchored on the Technology Organization Environment (TOE) framework and the Technology Readiness Index, the study adopted a cross-sectional survey design. A structured questionnaire was administered to 384 owners, managers and employees of registered service firms across the five South-East states of Abia, Anambra, Ebonyi, Enugu and Imo, of which 351 valid responses were retrieved and analysed. Research questions were answered using performance percentage and meanscore analysis, while the hypotheses were tested using simple and moderated multiple regression alongside Pearson product moment correlation at the 0.05 significance level. The findings revealed that AI adoption exerts a positive and statistically significant effect on service firm growth (β = 0.612, p < 0.001), and that employee technology readiness significantly and positively moderates the AI adoption firm growth relationship (ΔR² = 0.073, β = 0.284, p < 0.001), strengthening the relationship at higher levels of readiness. The Pearson analysis confirmed a strong positive correlation between AI adoption and firm growth (r = 0.681, p < 0.001). The study concluded that AI adoption is a meaningful driver of service firm growth, but its returns are conditioned by the readiness of the human capital expected to deploy it. It recommended deliberate investment in employee digitalcapability development, phased AI integration aligned with workforce competence, and supportive institutional policy to deepen AI uptake among service firms in the region.