IT Capabilities: Theoretical Perspectives and Empirical Operationalization

Abstract

With increased emphasis on the strategic role of IT in contemporary organizations, it is imperative to gain a deeper understanding of the factors that govern a firm’s IT capability. Yet, there exists very little understanding as to what constitutes a firm’s IT capability and how it could be measured. Drawing from theoretical perspectives and a systematic multi-stage research framework based on Delphi panels and focus groups, we conceptualize an enterprise-wide IT capability as a second order factor model. Using structural equation modeling techniques, the IT capability construct is empirically verified. Our study results provide a useful tool for benchmarking IT capability and serves as a foundation for operationalizing a key dependent variable in ITbusiness value research.

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