Balancing the Real with the Artificial: AI Integration in Complex, Compliant Environments

This work-in-progress study aims to develop a grounded, process-oriented theory of how AI integration evolves from pilot to sustained use in a legacy, high-compliance organization, and how governance practices and policy adoption emerge in daily work. Grounded in sociotechnical systems theory, levers of control, the Cynefin framework and systems analysis, it uses insider action research with constructivist grounded theory, treating each AI integration episode as the unit of analysis and drawing on interviews, internal documents, observations and indices of adoption, productivity, governance maturity and trust. It aims to produce an integration framework, a governance playbook and a decision-support model for leaders in regulated industries.