The Impact of IT capabilities on Firm Performance and the mediating role of Supply Chain Agility

Project Title

The Impact of IT capabilities on Firm Performance and the mediating role of Supply Chain Agility

Project Area of Specialization Shared EconomyProject Summary

Purpose – The aim of this study is to explore the relation of IT capabilities on Firm performance while keeping supply chain agility as the mediation. Secondly, assessing the impact or the moderating role organizational culture plays in between IT capabilities and supply chain agility. 

Design/methodology/approach – A validated questionnaire was adopted for data collection. The software of Smart PLS 3.0 was used to examine survey data obtained from 144 individuals’ in the manufacturing sector of Punjab and Kpk province of Pakistan. SEM technique was adopted to test the formulated hypotheses.

Findings – The findings of this study showed that out of 20 Hypotheses, 15 were found to supporting. It was found that organizational culture plays a significant role in enhancing the relationship between IT capabilities and supply chain agility. IT integration and IT infrastructure were found to be influencing supply chain agility significantly. Lastly, there was some degree of the direct impact of supply chain agility on firm performance.

Research limitations – This research only covers the manufacturing sector of Punjab and Kpk region of Pakistan. Time constraint for data collection was another limitation to the study. Limited data set hindered the generalization of findings of the study. Therefore, it is suggested that future researchers must consider a larger data set from all provinces of Pakistan in order to make a generalized finding.

Practical implications – Moreover, the study also brings practical implications for managers who can inculcate the findings of this study in everyday supply chain processes to develop a competitive advantage that yields in terms of firm performance.

Keywords: IT capabilities, IT integration, IT infrastructure, Supply chain agility, Speed, Competence, Flexibility, Responsiveness, and Firm Performance.

Project Objectives

1. To assess the impact of Information technology capability has on Supply chain agility.
2. To find the impact of Supply chain agility has on Firm Performance. 
3. To examine the moderating role of organizational culture between the relationship of Information technology capability and Firm performance.
4. To find how supply chain agility mediates the relationship between Information technology capability and Firm performance. 

Project Implementation Method

A validated questionnaire was adopted for data collection. The software of Smart PLS 3.0 was used to examine survey data obtained from 144 individuals’ in the manufacturing sector of Punjab and Kpk province of Pakistan. SEM technique was adopted to test the formulated hypotheses.

Benefits of the Project

This research paper provides three main theoretical implications or benefits. Firstly, this study provides an extensive literature on IT capabilities, supply chain agility and Firm performance and empirically test their relationship in the context of the supply chain. The findings of this study help in addressing the controversial issue of whether IT capabilities bring value to the firm. Secondly, this study incorporates the moderating effect of organizational culture which shows that relationship between IT capabilities and supply chain agility is further strengthened if the organizational culture is supportive. Only one or two few studies have examined the moderating effect of organizational culture in context of IT capabilities and supply chain agility. Therefore, the findings of this study can be of great use to managers and scholars for future research. Thirdly, this research broadens the understanding of supply chain agility and the findings indicate that IT capabilities are necessary for achieving supply chain agility which further leads to an increase in firm performance.

Moreover, this research also has some major practical implications for managers in the manufacturing sector of Pakistan. It is true that many firms in Pakistan are now investing in IT such as ERP systems and many other IT technologies to enhance firm performance but these IT investments don’t are of no use if the firms don’t leverage their IT capabilities and create a supportive organizational culture to achieve supply chain agility which further leads to firm performance. This study provides the managers with adequate knowledge and guidance to stress on IT capabilities to achieve supply chain agility and firm performance. Moreover, managers must realize that directly investing in IT would not yield in enhanced firm performance. Rather managers must consider supply chain agility, other dynamic capabilities, and IT capabilities together to yield enhanced firm performance. Therefore, managers should keep in consideration IT capabilities that improve and enhance knowledge and information in supply chain processes rather than focusing only on firm performance directly. 

Technical Details of Final Deliverable

The Final deliverable contained a compiled finalized report with references, sources of secondary data and the attached questionnaire used for the research.  

Final Deliverable of the Project Software SystemType of Industry IT , Manufacturing , Others Technologies Shared Economy, OthersSustainable Development Goals Industry, Innovation and Infrastructure, Responsible Consumption and ProductionRequired Resources

Item Name	Type	No. of Units	Per Unit Cost (in Rs)	Total (in Rs)
			Total in (Rs)	65500
Computer	Equipment	1	20000	20000
Printer	Equipment	1	15000	15000
Online article Purchase	Miscellaneous	0	10000	0
Fueling for Data collection	Equipment	150	100	15000
Car Rent for Data collection	Equipment	4	2500	10000
Spss Software	Equipment	1	5500	5500