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Objective and main results

This study examines the relationship between firm performance and business intelligence and analytics (BI&A), which is defined as a variety of organizational information practices that rely on the use of information technologies and involve the application of analytical techniques.

Main findings: 

• BI&A positively influences firm performance. This relationship is mediated by business process change capabilities.
  • Technical infrastructure and management capabilities related to BI&A positively influence organizations’ abilities to sense opportunities and threats, and further to make decisions, formulate action plans and alter business processes based on the acquired information.
  • Business process change capabilities positively influence operational efficiency and business process effectiveness, and in the next instance financial performance.

Summary of practical implications

Firms must recast BI&A from a technical asset to a firm capability that enables them to continually adapt to changing environments.

In parallel with technical investments in BI&A infrastructure and personnel, firms should invest in organizational practices that support effective communication and information sharing.

The assessment of benefits derived from BI&A investments should be conducted in conjunction with an evaluation of organizational process/change management practices.

Organizations may consider substituting investments in specialized BI&A personnel for investments intended to motivate BI&A use among current employees and establish standardized BI&A practices.

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Tags

Organizational capabilities IT capabilities Firm performance