UNLOCKING COMPETITIVE ADVANTAGE: THE NEXUS OF INFORMATION TECHNOLOGY, ABSORPTIVE CAPACITY, AND DYNAMIC CAPABILITIES IN ORGANIZATIONAL PERFORMANCE

Abstract

Objective: This study aims to empirically examine the influence of information technology (IT), absorptive capacity, and dynamic capabilities on firm performance.

Methodology: A quantitative research approach was adopted, utilizing survey data collected from a sample of firms across various industries. Structural equation modeling (SEM) was employed to analyze the relationships between the variables.

Results: The findings indicate significant positive relationships between information technology utilization and firm performance, absorptive capacity and firm performance, as well as dynamic capabilities and firm performance. Furthermore, absorptive capacity was found to mediate the relationship between information technology and firm performance.

Conclusion: This study underscores the importance of information technology, absorptive capacity, and dynamic capabilities in enhancing firm performance. Managers should focus on developing IT infrastructure, fostering absorptive capacity through knowledge acquisition, and nurturing dynamic capabilities for sustainable competitive advantage. Future research could explore additional factors that may influence these relationships and investigate their implications across different contexts