Information System Capabilities and Organizational Performance: Comparing Three Models

Abstract

How information system capabilities affect firm performance is an important issue. However, different research approaches often result in inconsistent results. This study compares three conceptual (knowledge-based view, resource-based view, and contingency-based view) and two modeling approaches (antecedents versus moderators) that can be used to assess the strategic value of information systems. The goal is to examine different ways to model various organizational factors. We also provide three different views to buttress arguments about the need for different types of moderator analyses. The advantage of such an approach is that managers and researchers can better differentiate potential influential factors into antecedents and moderators, and understand their different roles in KM implementation. This study uses data collected from 274 organizations to compare different prevailing views in KM research. The result indicates that the contingency approach can provide more insight into the role of different contextual variables. Some variables, such as the business process complexity and market orientation, found insignificant in the contingency-based model are found to be significant antecedents for improving managerial performance. Some variables that are found insignificant in the resource-based model are found to be significant moderators. For example, business process complexity and information technology (IT) support are not significant, as enablers proved to moderate the relationship between KMC and financial performance as homologizer and suppressor, respectively. The relationship between KM capabilities and financial performance is also moderated by leadership style and IT readiness of an organization. The results of this analysis show that the contingency model, with moderating effect, is more comprehensive and meaningful for future research.