The impact of IT capabilities on firm performance: The mediating roles of absorptive capacity and supply chain agility

Authors:
Hefu Liu;Weiling Ke;Kwok Kee Wei;Zhongsheng Hua
Affiliations:
School of Management, University of Science and Technology of China, Jinzhai Road 96, Hefei, Anhui, China;School of Business, Clarkson University, PO Box 5765, Potsdam, NY 13699-5765, United States;College of Business, City University of Hong Kong, 83 Tat Chee Avenue, Kowloon Tong, Hong Kong;School of Management, University of Science and Technology of China, Jinzhai Road 96, Hefei, Anhui, China
Venue:
Decision Support Systems
Year:
2013

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Abstract

Researchers and practitioners regard information technology (IT) as a competitive tool. However, current knowledge on IT capability mechanisms that affect firm performance remains unclear. Based on the dynamic capabilities perspective and the view of a hierarchy of capabilities, this article proposes a model to examine how IT capabilities (i.e., flexible IT infrastructure and IT assimilation) affect firm performance through absorptive capacity and supply chain agility in the supply chain context. Survey data show that absorptive capacity and supply chain agility fully mediate the influences of IT capabilities on firm performance. In addition to the direct effects, absorptive capacity also has indirect effects on firm performance by shaping supply chain agility. We conclude with implications and suggestions for future research.