Information System Capabilities as A Driving Force in Enhancing Organizational Performance: An Empirical Study

This paper conceptualizes the developmental paths of information system (IS) capabilities as a network of interrelated constructs, driven by the skills and knowledge of a firm's IT human resources. Because competitive IS capabilities need to be dynamic and market responsive, changing in tune with technological advances and market needs, organizational support, in particular top management commitment toward IT use and e-business development, is paramount. We posit that in a fastchanging IT environment, dynamic organizational IS capabilities are sources of competitive advantage, offering inimitable differentiation in service responsiveness, which is a key to securing sales in an increasingly customer-centric market. We develop these conceptualizations into a structural equation model and tested 12 hypothesized relationships using data drawn from a survey of 310 fast-growth small-to-medium sized companies in Australia. The test results uphold 8 of the 12 formulated hypotheses, lending support to our conceptualization.

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