Advancing Human‐AI Collaboration in Small and Medium‐Sized Enterprises: A Systems Engineering Approach

ABSTRACT The integration of Artificial Intelligence (AI) into organizational processes presents unique challenges for Small and Medium‐sized Enterprises (SMEs), particularly in fostering effective human‐AI collaboration. Unlike large corporations with extensive resources for AI adoption, SMEs require adaptable frameworks tailored to their specific constraints and operational needs. This paper introduces the novel Human‐AI Collaboration Maturity Model (HAIC‐MM), which is a systems engineering framework designed to assess, guide, and enhance AI integration within SMEs. Developed through the synthesis of AI maturity models, digital transformation frameworks, and human‐machine teaming research, HAIC‐MM identifies seven dimensions and 32 capabilities across five maturity levels that are essential for successful AI adoption in SME contexts. Empirical validation through survey analysis ( N = 100) confirmed the model's robustness. Subsequent focus group analyses ( N = 10, repeated across five sessions) further validated HAIC‐MM's practical utility and alignment with the operational realities of SMEs, emphasizing its relevance to everyday challenges faced by these organizations. Pilot testing with industry practitioners ( N = 3) confirmed the usability and usefulness of the final HAIC‐MM tool. HAIC‐MM provides SME leaders with a structured, human‐centered, and systematic approach to evaluate and cultivate human‐AI collaboration, addressing key areas such as resource optimization, workforce empowerment, ethical AI oversight, and adaptive organizational culture. This research contributes to AI‐enabled systems engineering by offering a practical framework for harmonizing human and AI capabilities within resource‐constrained environments, ultimately supporting SMEs in achieving sustainable and ethically grounded AI integration across the organization. Summary This paper introduces the Human‐AI Collaboration Maturity Model (HAIC‐MM), a framework designed to address the unique AI adoption challenges faced by Small and Medium‐sized Enterprises (SMEs). The model identifies critical dimensions and capabilities needed to foster effective collaboration between humans and AI systems. The model also defines five maturity levels within each capability, allowing a granular assessment within the holistic framework. HAIC‐MM provides a practical, step‐by‐step guide to assess and enhance AI integration for SMEs. The model emphasizes ethical AI oversight, workforce empowerment, and adaptive organizational culture, while addressing key challenges like resource constraints. HAIC‐MM represents a significant contribution to the fields of systems engineering and organizational behavior, offering researchers investigating socio‐technical systems, AI integration processes, and SME innovation strategies a rigorous framework for both theoretical advancement and practical implementation. With its focus on real‐world application, HAIC‐MM equips practitioners with actionable insights to build trust, optimize collaboration between human and AI capabilities, and achieve sustainable, ethically sound AI adoption, ensuring their organizations remain competitive in an increasingly digital economy.