Influence of Artificial Intelligence Applications on the Growth of Selected Medium Enterprises in Meru County, Kenya

Medium enterprises contribute to employment creation, innovation, income generation, and local economic development, yet many continue to experience slow growth in competitive and technology-driven markets. Artificial intelligence applications have become important digital capabilities because they support customer analytics, demand forecasting, automated customer responses, predictive insights, and data-driven decision-making. However, empirical evidence on the specific contribution of artificial intelligence applications to the growth of medium enterprises at the county level in Kenya remains limited. This study examined the effect of artificial intelligence applications on the growth of selected medium enterprises in Meru County, Kenya. The study was anchored on the Resource-Based View Theory and adopted a positivist research philosophy, quantitative research approach, and explanatory research design. The target population comprised 420 enterprise owners and managers, from which a sample of 205 respondents was selected through stratified random sampling. Data were collected using structured questionnaires and analyzed using descriptive statistics, Pearson Product Moment Correlation, and simple linear regression. The study attained a response rate of 72.2%. The findings established a positive and statistically significant relationship between artificial intelligence applications and enterprise growth (r = .566, p = .000). Regression analysis further showed that artificial intelligence applications explained 32.0% of the variation in enterprise growth (R² = .320) and had a positive significant effect (B = .548, β = .566, t = 8.303, p = .000). The study concluded that artificial intelligence applications enhance enterprise growth by improving business intelligence, customer understanding, market responsiveness, forecasting, and operational decision-making. The study recommends affordable AI training, digital advisory support, and progressive adoption of analytics, forecasting, and automated customer support tools among medium enterprises.