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Abstract

Although research recognizes the role of IT and organizational agility on firm performance, a research gap to investigate IT-enabled agility at strategic and operational levels exists. In this study, we define operation-level agility as a firm’s ability to respond to market changes or emerging opportunities by quickly modifying its business routines. In contrast, we define strategic-level agility as a firm’s ability to define long-range investment decisions and implement them to accommodate strategic moves and business initiatives. We investigate how IT can empower these two levels of agility, and, in turn, how these two levels of agility can influence firm performance. We also examine the relative roles of the two levels of IT-enabled agility in manufacturing and service settings. We use survey data to validate the proposed hypotheses. The results indicate that, in general, IT leads to superior firm performance through agility at both levels. Further analyses, however, suggest that IT-enabled operation-level agility is a stronger success factor for service firms and IT-enabled strategic-level agility is more critical in manufacturing firms. Our findings provide a theoretical insight regarding the industry-specific values of IT-enabled agility at operation and strategic levels and practical implications for organizational IT deployment under specific industrial settings.

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