Abstract:

This study investigates how generative artificial intelligence (GAI) enabled decision-making contributes to the normalisation of grey entrepreneurial practices in platform-based small and medium-sized enterprises (SMEs). While existing research largely emphasises the efficiency and optimisation benefits of GAI, its broader institutional implications remain underexplored, particularly in contexts characterised by regulatory ambiguity and institutional voids. Drawing on institutional voids theory, this study examines how GAI reshapes entrepreneurial engagement with compliance, legitimacy, and everyday organising. The study adopts a qualitative design based on semi-structured interviews with founders and co-founders of 18 platform-based SMEs operating in Egypt, complemented by secondary data. Using an abductive thematic analysis, the findings reveal three mechanisms through which GAI normalises grey practices: embedding hybrid routines into operational processes, enabling selective compliance within platform-governed markets, and reframing legitimacy and risk through algorithmic rationality. Rather than formalising entrepreneurship, GAI stabilises and legitimises hybridity, transforming grey practices from temporary adaptations into taken-for-granted organisational norms. By conceptualising GAI as a socio-institutional force, this study contributes to research on digital entrepreneurship, institutional voids, and platform governance, highlighting how advanced digital technologies may reinforce institutional fragmentation in platform-mediated environments.

Please choose your submission type: Full Paper

Primary Track: Innovation

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Dr. Hebatalla Kaoud