Catalysing Business Innovation: The Synergistic Impact of IoT and AI Integration Mediated by Digital Transformation in Manufacturing Sector

This research focuses on the manufacturing sector, and how Internet of Things (IoT) and artificial intelligence (AI) integration influences business innovation, while investigating digital transformation’s role in mediation. For this purpose, a quantitative research design is employed, whereas structured questionnaires are used to gather data from 230 respondents within 79 manufacturing firms characterising sectors such as FMCG, food and beverages as well as chemicals. This research emphasises variables such as automation, technological deployment and process reengineering to measure their impact on process, business model innovation and product. The meaningful findings suggest that IoT and AI integration impacts business innovation significantly, while digital transformation amplifies these effects through digital agility, value creation and optimised processes. Results further highlight that firms which align with technological adoption and digital transformation strategies realise superior innovation effects. Basically, this research offers strategic suggestions for policymakers and managers to promote competitiveness and sustainable innovation within Dubai’s manufacturing ecosystem, ultimately leveraging IoT and AI effectiveness.