MODELING THE RELATIONSHIP BETWEEN FIRM IT CAPABILITY,COLLABORATION, AND PERFORMANCE

The development and use of information technology (IT) have been thematic in recent literature. IT has been viewed as an enabler of internal and external firm collaboration, which is the foundation of supply chain management. Firm collaboration and information sharing, in turn, are expected to improve firm performance. A model of the relationship between firm IT capability, internal and external collaboration, and firm performance is proposed and tested, using empirical data. The findings show that firm IT capability directly impacts internal and external collaboration as well as firm performance. This finding has important implications for managers as they evaluate investment in information technologies.