The Influence Of Technologies, Organizational Capabilities, And People On Organizational Performance In Electronic Manufacturing Industry

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Date
2016-09
Authors
Mohd Ali, Mohamed Fadzil
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Abstract
This study employs resources-based view (RBV) and dynamic capabilities theory to address organizational performance issues within the context of electrical and electronic (E&E) manufacturing sector. Consistent with the theory, resources which were based from I-TOP model are vital to the success and performance of a firm. This study also explores beyond the significance of resources which influence organizational performance in manufacturing sector. Managing business in a dynamic business environment and intense competition from rival firms has often lead to inconsistent performance especially during difficult period and unpredictable business environment. Instituting strategic agility in manufacturing sector has been identified as a strategy to succeed in current business trend where firms are frequently exposed to highly competitive and uncertain business environments. This thesis seeks to explore the influence of resources and strategic agility impact in dynamic business environment towards firms’ performance. The survey was carried out among E&E manufacturing firms in Malaysia. A total of 111 usable responses were received from the respondents. The data collected were thoroughly analyzed through structural equation modelling (SEM), including multi-group SEM analysis, as means to investigate all variables in the proposed framework and to confirm the hypothesis of interest. The technique used for data analysis were descriptive statistic, confirmatory factor analysis, including three types of validity test: convergent, discriminant and nomological test. Four broad sets of interesting findings are identified in this study. First, organizational capabilities is the strongest predictor of organizational performance. Second, there is a mutual relationship between technologies and organizational performance. Third, people (human capital) has no significant influence on the organizational performance. Finally, this study revealed that organizational capabilities is mediated through strategic agility which helps manufacturing firms to continue to perform in a dynamic business environment or during unexpected changes. These findings provide important key value to practitioner, i.e. in dynamic business environment and unpredictable change, strategic agility is achievable and can be developed by having strong organizational capabilities. Combination of organizational capabilities and strategic agility will help organizations to swiftly respond and react to sudden market change and thus gain some advantages. In a nut shell, this study highlights the contributions by expanding the application of both the RBV and dynamic capabilities theories into manufacturing sector in Malaysia. This study is expected to enhance the academic knowledge particularly through: (1) the mutual effect of technologies, organizational capabilities and organizational performance and (2) the mediating effect of strategic agility on the relationship between organizational capabilities and organizational performance.
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The significance of resources which influence organizational , performance in manufacturing sector.
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