MATHEMATICAL SIMULATION AND AI INTEGRATION FOR OPTIMIZING ENTERPRISE DIGITAL STRATEGIES

Enterprises worldwide use AI and mathematical simulations to strengthen digital strategies, yet fragile contexts such as Iraq face barriers that slow progress. This study examined how digital twins, agent-based models, and system dynamics, when integrated with AI, influenced strategic alignment, agility, precision, and adaptability in Iraq between 2020 and 2024. Secondary data from 210 enterprise-year observations covering firms, government units, and financial institutions was analyzed through descriptive statistics, correlation, and regression. Results showed that digital twins improved alignment by 22 percent, reduced costs by 12 percent, and raised agility by 15 percent, while agent-based models cut forecast errors by 13 percent and improved risk precision by 15 percent. System dynamics pilots raised adaptability to 12 percent but remained underused. Integration methods had the strongest effect, with regression results showing coefficients of 0.34 for integration, 0.27 for simulation type, and 0.19 for application area, while contextual constraints such as data readiness and computational capacity limited broader scaling with a coefficient of 0.11. The correlation matrix confirmed strong positive relationships, with integration scoring 0.68 against performance. The findings imply that embedding simulations in BI dashboards, coupling them with AI predictive models, and linking to decision support systems are essential for measurable gains. Recommendations call for managers to expand pilot projects, policymakers to improve infrastructure and data governance, and scholars to refine theories of alignment, precision, and resilience in fragile environments.