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Purpose Drawing on dynamic capability theory, this study investigates how digital integration influences firms’ agility. The mediating role of organizational inertia and the moderating role of market information transparency are further examined. Design/methodology/approach Using survey data from 170 Chinese firms, this study empirically tests the proposed moderated mediation model. Findings The results reveal that digital integration has a direct and positive influence on agility. Furthermore, digital integration indirectly enhances agility by diminishing organizational inertia. Additionally, our results show that market information transparency mitigates the negative relationship between organizational inertia and agility but does not significantly influence the positive relationship between digital integration and agility. Research limitations/implications This study advances the understanding of agility development. However, its cross-sectional design limits insights into causal relationships; thus, we call for longitudinal studies to explore the relationship between digital integration and agility. Practical implications This research offers valuable insights for practitioners to leverage digital integration to enhance agility by reducing organizational inertia and fostering a transparent market environment. Originality/value This study enriches the literature on agility in the era of digitalization by revealing that digital integration reduces organizational inertia, a potential barrier to a firm’s agility. We also find that market information transparency moderates the relationship between organizational inertia and agility.
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