Artificial Intelligence (AI) is often celebrated for its role in improving operations, automating workflows, and driving productivity. Yet, one of its most transformative — and least understood — applications lies in strategy formulation. A 2025 study by Murali Chari, Anne Jackson, Inder Thukral, and Steven Walsh, published in Taylor & Francis Online, explores how AI is reshaping the way organizations develop and execute strategic decisions.
AI Moves Beyond Operations
Most companies have already adopted AI for internal operations — from process automation to predictive maintenance and customer analytics. However, the use of AI in strategic decision-making has lagged behind. Unlike operational tasks, strategy requires integrating complex, often ambiguous data sources to identify opportunities, forecast risks, and map competitive landscapes.
The authors argue that this very complexity makes AI both powerful and challenging in the realm of strategy. Traditional strategy formulation relies on experience, intuition, and historical data. AI, on the other hand, introduces a data-driven, real-time dimension, allowing leaders to uncover patterns and scenarios that human judgment alone might overlook.
How AI Enables Smarter Strategic Decisions
The research highlights how machine learning (ML), natural language processing (NLP), and knowledge graphs (KG) are being applied in AI-based consulting practices to support corporate strategy.
For instance, AI systems can now:
- Identify industry players and emerging competitors automatically using NLP-driven market scans.
- Analyze firm-level data to detect performance patterns and risk factors invisible in traditional models.
- Map relationships among variables such as pricing, innovation, and market share through machine learning.
This analytical depth enables leaders to simulate strategic outcomes, evaluate market positioning, and make decisions grounded in dynamic, evidence-based insights.
The New Role of the Strategist
As AI takes on the heavy lifting of data collection and pattern recognition, the strategist’s role is evolving. Instead of manually gathering information, leaders can focus on interpreting insights, aligning decisions with corporate values, and ensuring ethical AI use.
This shift doesn’t replace human judgment — it amplifies it. The researchers emphasize that human context, creativity, and ethical oversight remain irreplaceable, even as AI transforms the mechanics of strategic planning.
From Intuition to Intelligence
AI’s growing influence in strategy formulation signals a broader movement from intuition-driven to intelligence-driven strategy. As organizations embrace AI-enabled frameworks, they gain the ability to visualize complex environments, adapt faster, and sustain long-term competitiveness.
The future of business strategy won’t be written by algorithms alone — but by humans and machines working together to navigate uncertainty with unprecedented clarity.
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- https://www.taylorandfrancis.com/
- https://www.sciencedirect.com/science/article/pii/S0304405X2300185X
- https://hbr.org/2023/09/how-generative-ai-is-transforming-strategy
- https://sloanreview.mit.edu/article/how-ai-is-transforming-business-strategy/
- https://www.mckinsey.com/capabilities/mckinsey-digital/our-insights/the-state-of-ai-in-2024
