Journal
JOURNAL OF BUSINESS & INDUSTRIAL MARKETING
Volume 38, Issue 5, Pages 1041-1054Publisher
EMERALD GROUP PUBLISHING LTD
DOI: 10.1108/JBIM-08-2021-0406
Keywords
IT advancement and alignment; IT capability; Firm agility; Firm performance; Dynamic capability; Mediation analysis
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This study examines the impact of IT capability on firm agility and firm performance. The findings confirm the direct effect of IT capability on firm agility, the direct impact of firm agility on firm performance, and the indirect effect of IT capability on firm performance through firm agility. This study highlights the importance of developing IT capability and its influence on firm performance during the COVID-19 outbreak.
Purpose Leveraging theory from the dynamic capability literature, this study aims to explore how information technology (IT) capability influences firm agility and subsequently translates into firm performance. Design/methodology/approach This study examines the proposed relationships by using survey data from a sample of 296 Chinese retail firms. Structural equation modeling is used to test this study's hypotheses. Findings The following results are produced: the direct effect of IT capability on firm agility is confirmed; firm agility has a direct impact on firm performance; and the indirect effect of IT capability on firm performance via firm agility is demonstrated (i.e. partial mediation). Originality/value The catastrophic outbreak of the COVID-19 pandemic has heightened the importance of firm agility more than ever. Although the traumatic event is painful, however, there is nothing like a crisis to offer a tremendous business opportunity. In response to the pandemic circumstance, firms are required to operate their business by reacting to unpredictable and dynamic market changes quickly and efficiently. This study sheds light on why firms should develop their IT capability and how it affects firm performance via firm agility during the COVID-19 outbreak.
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