Enabling supply chain agility through IOS integration and supply chain flexibility

In today's turbulent environment, competitive pressures and market unpredictability have dramatically lashed business profits. Agility is an essential ability for firms facing such an environment. However, coping with the hostile business environment requires not only the agility from individual firms but also the collaboration from their supply chain partners. Supply chain agility (SCA) therefore is vital to the competitiveness and performance of a firm and its supply chain partners. Exploring how to effectively enable SCA is significant for both practice and theory development. Recently, firms are increasingly relying on integrated information systems and analytical tools, such as business intelligent systems, and close collaboration with their supplier chain partners to enhance their responsiveness. This paper seeks to broaden the understanding about the enabling roles of IOS integration, analytical ability of inter-organizational information systems (IOS), and supply chain flexibility on SCA based on the dynamic capabilities view and real options theory. With a sample of 147 matched-pair data gathered from the top 2000 Taiwanese manufacturing firms, our results support the effect of IOS integration on supply chain flexibility, including offering and sourcing flexibilities, which in turn facilitate SCA. We also propose and show the moderating effect of analytical ability of IOS on the process of enabling SCA. These results contribute to a better understanding of how SCA may be achieved in theory and in practice. The model and findings of this study should be able to serve as a basis for future research for studying SCA.