AI boosts tourism competitiveness through workforce upskilling and cultural readiness

The study demonstrates that AI adoption exerts a strong and positive direct effect on sustainable competitive advantage in tourism and hospitality organizations. By integrating AI applications in areas such as demand forecasting, customer service, and operational optimization, firms can enhance efficiency, improve decision-making, and deliver higher-quality experiences to visitors.

A new study reveals that artificial intelligence (AI) significantly enhances the competitive performance of tourism and hospitality firms when combined with strong digital culture and workforce skills. The research is presented in the paper “AI-Driven Sustainable Competitive Advantage in Tourism and Hospitality: Mediating Roles of Digital Culture and Skills,” published in Sustainability.

The study focuses on the Saudi Arabian tourism sector as it undergoes rapid modernization under Vision 2030, assessing how AI adoption, internal culture, and employee skills interact to deliver sustainable competitive advantage. Drawing on a large sample of managers and supervisors from leading hotels, travel agencies, and destination management companies, the research identifies the pathways that enable technology to translate into lasting performance gains.

AI as a driver of competitive advantage

The study demonstrates that AI adoption exerts a strong and positive direct effect on sustainable competitive advantage in tourism and hospitality organizations. By integrating AI applications in areas such as demand forecasting, customer service, and operational optimization, firms can enhance efficiency, improve decision-making, and deliver higher-quality experiences to visitors.

However, the authors highlight that technology alone is insufficient to ensure long-term gains. AI’s impact is amplified when organizations foster the right culture and develop the digital skills needed to leverage data-driven tools effectively. The findings show that AI adoption not only contributes directly to performance but also stimulates improvements in organizational culture and workforce capabilities.

This dual effect, both direct and indirect, underscores the need for tourism operators to view AI not merely as a technical investment but as a transformation strategy that requires alignment of people, processes, and technology.

Mediating roles of digital culture and skills

The study identifies the mediating roles of digital culture and digital skills. According to the study, both factors partly mediate the link between AI and sustainable competitive advantage, indicating that organizations with supportive cultures and well-trained employees achieve better outcomes from AI investments.

The study finds that companies with strong digital cultures, characterized by openness to innovation, collaborative learning, and data-driven decision-making, can integrate AI tools more effectively into their daily operations. This cultural alignment enables faster adoption and better utilization of emerging technologies, reducing resistance to change and improving strategic agility.

Similarly, the research sheds light on the importance of developing digital skills across the workforce, from technical competencies for managing AI systems to interpretive skills for understanding algorithmic outputs and integrating them into business decisions. Skilled employees help translate AI insights into practical improvements in service quality, resource use, and competitive positioning.

Policy and industry implications for the tourism sector

The findings carry important implications for both policymakers and industry leaders in tourism and hospitality. The authors argue that the success of AI initiatives depends on parallel investments in human capital and organizational readiness, not just in software and hardware.

The study recommends that tourism organizations:

• Conduct capability assessments to align AI deployments with existing digital maturity levels.
• Implement comprehensive training and upskilling programs, including micro-credentials, to prepare employees for AI-enhanced operations.
• Embed cultural change initiatives into corporate strategies by recognizing and rewarding teams that successfully adopt and apply digital tools.
• Establish governance frameworks that incorporate metrics for culture and skills development alongside traditional performance indicators.

For policymakers, the study highlights the need for sector-wide digital transformation strategies that support workforce development and foster innovation-friendly business environments. Public–private partnerships, targeted funding for digital training, and the creation of AI learning labs could accelerate the adoption of best practices.

The authors note that as Saudi Arabia seeks to position itself as a global tourism hub, addressing these human and cultural dimensions is critical for achieving sustainable competitive advantages that align with the country’s broader economic diversification goals.

Limitations and future research directions

While the study offers valuable insights, the authors acknowledge certain limitations. The research was conducted exclusively in Saudi Arabia, and its findings may not be fully generalizable to other countries with different institutional or cultural contexts. The focus on managerial and supervisory staff also leaves out perspectives from small and medium-sized enterprises and frontline workers.

Moreover, the study treats digital culture and skills as broad constructs, suggesting that future research should explore their sub-dimensions, such as leadership support, innovation orientation, or specialized technical competencies, to provide more granular guidance.

The authors recommend extending this line of inquiry to other tourism markets and examining the interplay between AI and other organizational factors, such as leadership styles, regulatory frameworks, and customer perceptions, to capture a more holistic picture of AI’s role in shaping sustainable competitive advantage.