Abstract
Grounded in dynamic capability theory, this study aims to examine how the adoption of AI improves the performance of IT projects through parallel mediators, team members’ perception of organizational creativity and project innovation. This study tests the moderating role of ethical identity in the relationship between a) adoption of AI and organization creativity and b) adoption of AI and project innovation. Data were collected through two-wave, time-lagged surveys from 202 project professionals working in IT firms. Results suggest that AI adoption directly and indirectly positively influences project performance via organizational creativity and project innovation. The study results show that when an organization has a high level of ethical identity, the positive interplay between AI adoption with organizational creativity and project innovation is strongest. These findings have strong implications for project based organizations seeking to adopt AI to enhance creativity and innovation, leading to improved project performance.