Examining the relationship between IT capabilities and supply chain performance the mediating role of supply chain visibility

Abstract

A growing body of scholars has stressed the importance of embracing IT capabilities concept from the perspective of a dynamic capability view that emphasizes the need to adapt and change in the face of rapidly changing market requirements. These capabilities are the firm’s inter-linked processes that are vital for future resource creation and allow firms to manage upcoming challenges in a dynamic business environment by directing all the focus to creating, renewing or altering a resource mix to get a competitive advantage, thus increasing supply chain performance. The review of cognate literature demonstrates that the outcomes of IT capability research are diverse and that the relationship between IT capability and supply chain performance remains underexplored. Further, the mechanisms and contingencies through which IT capabilities contribute to performance is little understood. The study investigated the mediating role of supply chain visibility and in the link between IT capability and supply chain performance. The study employed quantitative research approach and cross-sectional survey research strategy. The study also utilized explanatory research design. Firms operating in Central, Western and Greater Accra Regions of Ghana were sampled conveniently for the study. Survey data was gathered from 100 firms using structured questionnaires. Data was analyzed using Statistical Software Packages such as SPSS. The study revealed that IT capability and supply chain visibility has a positive significant link with supply chain performance. Further, the study revealed that supply chain visibility partially mediates the link between logistics capability and supply chain performance. It is concluded that firms should invest in developing their IT capabilities and competences in order to harness it to improve supply chain performance.