Artificial Intelligence Implementation and Its Effect on Productivity Quality and Cost Efficiency in Industry

Arif Pratama; Agustina  Salu; Fanny  Aurelia

Authors

Arif Pratama Department of Industrial Engineering, Faculty of Engineering, Universitas Hasanuddin, Makassar, Indonesia
Agustina Salu Department of Industrial Engineering, Faculty of Engineering, Universitas Hasanuddin, Makassar, Indonesia
Fanny Aurelia Department of Industrial Engineering, Faculty of Engineering, Universitas Hasanuddin, Makassar, Indonesia

Keywords:

Artificial Intelligence, Industrial Automation, Productivity

Abstract

This study examines the implementation of Artificial Intelligence in industrial organizations and its effects on productivity quality and cost efficiency. Using a mixed methods approach, the research draws on qualitative interview data, document analysis, and quantitative performance indicators collected from multiple industries with varying levels of automation maturity. The findings demonstrate that AI enabled automation significantly enhances productivity through faster processing speeds, reduced operational downtime, and improved decision accuracy. Quality improvements are evident in lower error rates, higher consistency, and more reliable compliance with technical standards, particularly in data intensive and repetitive processes. Cost efficiency gains are observed mainly through process optimization, waste reduction, and labor reallocation rather than direct workforce reduction. However, the results also reveal that the magnitude of these benefits depends strongly on organizational readiness, including digital infrastructure integration, workforce digital skills, and effective governance mechanisms. Organizations with higher socio technical preparedness experience smoother implementation and more sustainable performance outcomes. Overall, the study contributes empirical evidence that Artificial Intelligence serves not only as an efficiency enhancing technology but also as a strategic capability that supports long term industrial competitiveness when aligned with human and organizational factors.

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