ARTIFICIAL INTELLIGENCE IN FINANCIAL DECISION-MAKING AND COMPETITIVE ADVANTAGE: EVIDENCE FROM SELECTED EUROPEAN INDUSTRIAL FIRMS

Abstract

This paper analyzes the role of artificial intelligence (AI) in improving financial decision-making and creating competitive advantage in selected European industrial companies. The aim of the study is to assess how integrating AI into financial planning, risk management, performance analysis, operational processes, and strategic decision-making affects firms’ efficiency, resilience, and competitive positioning. The study employs a qualitative multiple-case study approach using secondary data, including annual reports, sustainability reports, investor materials, and official corporate documents from three European industrial companies: Siemens AG, Schneider Electric SE, and Krka. d., Novo mesto. The findings show that AI contributes to more accurate financial forecasting, cost optimization, data-driven risk management, operational efficiency, and improved strategic decision support. Siemens AG and Schneider Electric SE demonstrate a stronger AI-driven competitiveness model in which AI is closely linked to digital platforms, automation, industrial innovation, and sustainability-oriented value creation. In contrast, Krka reflects a more gradual digital transformation path, in which competitiveness is primarily supported by financial discipline, operational efficiency, risk control, and ESG governance. The study contributes to the literature by demonstrating that AI enhances competitive advantage when combined with financial management, organizational capabilities, digital maturity, and responsible governance among European industrial firms.