Analytics Capability and Firm Performance in Supply Chain Organizations: The Role of Employees’ Analytics Skills

Abstract

Developing analytics capability has become one of the main priorities in organizations today. Despite the increasing use of analytics, the necessary conditions to obtain the expected benefits from such investment still need to be examined. Relying on information processing theory (OIPT), this study sheds some light on the requirements for properly utilizing analytics to receive the potential benefits in supply chain firms. Specifically, we study the role of supply chain process integration in developing analytics capability, and we further examine the role of analytics capability and employees’ analytics skills in improving firm performance. Survey data collected from 240 supply chain top- and middle-level managers show that supply chain process integration enhances firms’ analytics capability. However, analytics capability alone is not sufficient in improving firm performance; it must be complemented with employees’ analytics skills. These findings extend the current literature on supply chain analytics and provide guidance and insights to supply chain managers for their analytics capability investments.