Supply chain digitalization, innovation capability, and organizational agility: The moderating role of institutionalization and supply chain integration

In times of supply chain disruptions, supply chain digitalization is a primary dynamic capability to create organizational agility through innovative thinking. There is a lack of empirical evidence about the role of external factors in organizational agility. Therefore, drawing upon the theory of dynamic capabilities, this paper addresses the research question: How can supply chain digitalization contribute to organizational agility in business-to-business relationships? We collected empirical data from 201 business-to-business organizations to test the hypothesized relationships in the proposed model and address the research question. The findings reveal that supply chain digitalization contributes to innovation capability, which can result in organizational agility. This paper also proposes two moderators, supply chain integration and institutionalization, to explain when supply chain digitalization backfires. Supply chain integration strengthens the positive effects of supply chain digitalization on innovative practices, while institutionalization has a negative moderating impact. The main contribution of this paper is the presentation of moderated mediation effects in organizational agility studies.