An Assessment of Technological Competencies on Professional Service Firms Business Performance
This study was initiated with a three prong objective.
One, to identify the relationship between Technological
Competencies factors (Technical Capability, Firm Innovativeness
and E-Business Practices and professional service firms- business
performance. To investigate the predictors of professional service
firms business performance and finally to evaluate the predictors of
business performance according to the type of professional service
firms, a survey questionnaire was deployed to collect empirical data.
The questionnaire was distributed to the owners of the professional
small medium size enterprises services in the Accounting, Legal,
Engineering and Architecture sectors. Analysis showed that all three
Technology Competency factors have moderate effect on business
performance. In addition, the regression models indicate that
technical capability is the most highly influential that could
determine business performance, followed by e-business practices
and firm innovativeness. Subsequently, the main predictor of
business performance for all types of firms is Technical capability.
[1] J. Lee, "Complementary effects of information technology investment on
firm profitability: the functional forms of the complementarities",
Information System Management, Vol. 25, No 4, 2008, pp 364-371.
[2] H. Salmela, and P.Turunen, "Competitive implications of information
technology in the public sector: the case of the city geographic
information system", International Journal of Public Sector
Management, Vol. 16, No. 1, 2003, pp 8-26.
[3] Y. Huo, "Information technology and the performance of the restaurant
firms", Journal of Hospitality and Tourism Research, Vol. 22, No. 3,
1998, pp. 239-251.
[4] V. Kula, and E. Tatoglu, "An exploratory study of internet adoption by
SMEs in an emerging market economy", European Business Review,
Vol. 15, No. 5), 2003, pp 324 - 333.
[5] M. Zhang, S. Sarker, and J. McCullough, "Measuring information
technology capability of export-focused small or medium sized
enterprises in china: scale development and validation", Journal of
Global Information Management. Vol. 16, No. 3, 2008, pp. 1-25.
[6] D. Lester, and T. Tran, ÔÇÿInformation capabilities: suggestion for SME
growth-, Journal of Behavioral and Applied Management. Vol. 10, No.
1, 2008, pp 72-89.
[7] M. Zhang, and P. Tansuhaj, "Organizational culture, information
technology capability, and performance: the case of born global firms",
Multinational Business Review. Vol. 15, No. 3, 2007, pp. 43-78.
[8] R. Rousseva, "Identifying technological capabilities with different
degree of coherence: the challenge to achieve high technological
sophistication in latecomer software companies (based on the Bulgarian
case)", Technological Forecasting and Social Change, Vol. 75, 2008, pp
1007-1031.
[9] J. Dedrick, V. Gurbaxani, and K L. Kraemer, "Information technology
and economic performance: a critical review of the empirical evidence,"
ACM Computing Surveys, 2003. Vol. 35, No. 1, 2003, pp 1-28.
[10] E.A. Morse, S.W. Fowler, and T.B. Lawrence, "The impact of virtual
embeddedness on new venture survival: overcoming the liabilities of
newness". Entrepreneurship Theory & Practice, Vol. 31, No 2, 2007, pp
139-159.
[11] S. Bharadwaj, "A resource-based perspective on information technology
capability and firm performance, an empirical investigation". MIS
Quarterly, Vol. 24, No. 1, 2000, pp 169-196.
[12] H. Jiao, I.C. Chang, and Y. Lu, "The relationship on information
technology capability and performance: An empirical research in the
context of China-s Yangtze River Delta Region" in 2008 Proceeding
IEEE IEEM Conference, pp 872-876.
[13] S. Lall, Learning from Asian Tigers, Macmillan Press, London, 1996.
[14] D. F. Feeny, and L.P. Willcocks, "Core IS capabilities for exploiting
information technology", Sloan Management Review, Vol. 39, No. 3,
1998, pp 9-21.
[15] S.M. Huang, C.S. Ou, C.M Chen, B. Lin, "An empirical study of
relationship between IT investment and firm performance: A resourcebased
perspective", European Journal of Operational Research, Vol.
173, 2006, pp 984-999.
[16] S. Mei, and M. Nie (2007), "Technological capability, marketing
capability and network capability: Keys to enhancing competitiveness
and improving performance-, in 2007 International Conference on
Management Science and Engineering (14th), Harbin, PR China, pp 728-
733.
[17] F.E. García-Muiña, and J.E Navas-López, "Explaining and measuring
success in new business: the effect of technological capabilities on firm
results, Technovation, Vol. 27, No. 1-2 , 2007, pp 30-46.
[18] R.S. Eckaus, The Creation of Technology Capability in Developing
Countries, London, Frances Pinter, 1991.
[19] National Research Council Canada, Increasing innovation capabilities of
Canada-s SMEs, Annual Report 2001-2002, 2002.
[20] C. Lin, and M. Chen, "Does innovation lead to performance? An
empirical study of SMEs in Taiwan", Management Research News, Vol.
30, No. 3, 2007, pp 115 - 132
[21] G.H Gaynor, Innovation by design: What It Takes to Keep Your
Company on the Cutting Edge, 2002.
http://books.google.com.my/books?+Innovation+by+design (as at 8
July, 2008)
[22] C. Gray, "Absorptive capacity, knowledge management and innovation
in entrepreneurial small firms", International Journal of Entrepreneurial
Behavior and Research, Vol. 12, No. 2, 2006, pp 345 - 360.
[23] P. Humphreys, R. McAdam, and J. Leckey, "Longitudinal evaluation of
innovation implementation in SMEs", European Journal of Innovation
Management, Vol. 8, No. 3, 2005, pp 283 - 304.
[24] R.P. Watson, F.P. Leyland, P. Berthon, and G. Zinkham, "U-Commerce:
Expanding the universe of marketing", Journal of the Academy of
Marketing Science, Vol. 30, No 4, 2002, pp 333-47.
[25] T. Volery, and D. Lord, "Critical success factors in online education",
International Journal of Educational Management, Vol. 14, No. 5,
2000, pp 216-223.
[26] C.Y. Woo, A. Cooper, W. Dunkelberg, U. Dallenbach, and W.J. Dennis,
"Determinants of growth for small and large entrepreneurial start-ups. In
R.H. Brockhaus, N.C. Churchill, J.A. Katz, B.A. Kirchoff, K.H. Vesper
& W.E. Werzel (Eds.), Frontiers of Entrepreneurship Research, 1989, pp
134-147, Boston: Babson College.
[27] R.L. Cochran, and R. Wood, "A corporate social responsibility and
financial performance", Academy of Management Journal, Vol. 27, No.
1, 1984, pp 42-56.
[28] N. Ibrahim, and L. Rue, "The relationship between planning
sophistication and performance in small business-, Journal of Small
Business Management, Vol. 36, No. 4, 1998, pp 24-32.
[29] F. Delmar, P. Davidsson, and W.B Gartner, "Arriving at the high-growth
firm", Journal of Business Venturing, Vol. 18, No. 2, 2003, pp189-216.
[30] P. Love, and Z. Irani, "An exploratory study of information technology
evaluation and benefits management practices of SMEs in the
construction industry", Information and Management, Vol. 42, No. 1,
2004, pp 227 - 242.
[31] M. Jonker, H. Romijn, and A. Szirmai, "Technological effort,
technological capabilities and economic performance. A case study of
the paper manufacturing sector in West Java", Technovation, 26, 2006,
pp 121-134
[32] C. Nakata, Z. Zhu and M. Kraimer, "The complex contribution of
information technology capability to business performance", Journal of
Managerial Issues, Vol. 20, No. 4, 2008, pp. 485-509.
[33] L. Kanuk, and C. Berenson, "Mail surveys and response rates: a literature
review-, Journal of Marketing Research, Vol. 12, 1975, pp 440-453.
[34] U. Sekaran, Research Methods for Business, 2nd ed., Wiley, New York,
1992.
[35] J.C. Nunnally, Psychometric Theory, 2nd ed., McGraw-Hill, New York,
1978.
[36] C. Fornell, and D. Larcker, "Structural equation models with
unobservable variables and measurement error-. Journal of Marketing
Research, Vol. 18, No. 1, 1981, pp 39-50.
[1] J. Lee, "Complementary effects of information technology investment on
firm profitability: the functional forms of the complementarities",
Information System Management, Vol. 25, No 4, 2008, pp 364-371.
[2] H. Salmela, and P.Turunen, "Competitive implications of information
technology in the public sector: the case of the city geographic
information system", International Journal of Public Sector
Management, Vol. 16, No. 1, 2003, pp 8-26.
[3] Y. Huo, "Information technology and the performance of the restaurant
firms", Journal of Hospitality and Tourism Research, Vol. 22, No. 3,
1998, pp. 239-251.
[4] V. Kula, and E. Tatoglu, "An exploratory study of internet adoption by
SMEs in an emerging market economy", European Business Review,
Vol. 15, No. 5), 2003, pp 324 - 333.
[5] M. Zhang, S. Sarker, and J. McCullough, "Measuring information
technology capability of export-focused small or medium sized
enterprises in china: scale development and validation", Journal of
Global Information Management. Vol. 16, No. 3, 2008, pp. 1-25.
[6] D. Lester, and T. Tran, ÔÇÿInformation capabilities: suggestion for SME
growth-, Journal of Behavioral and Applied Management. Vol. 10, No.
1, 2008, pp 72-89.
[7] M. Zhang, and P. Tansuhaj, "Organizational culture, information
technology capability, and performance: the case of born global firms",
Multinational Business Review. Vol. 15, No. 3, 2007, pp. 43-78.
[8] R. Rousseva, "Identifying technological capabilities with different
degree of coherence: the challenge to achieve high technological
sophistication in latecomer software companies (based on the Bulgarian
case)", Technological Forecasting and Social Change, Vol. 75, 2008, pp
1007-1031.
[9] J. Dedrick, V. Gurbaxani, and K L. Kraemer, "Information technology
and economic performance: a critical review of the empirical evidence,"
ACM Computing Surveys, 2003. Vol. 35, No. 1, 2003, pp 1-28.
[10] E.A. Morse, S.W. Fowler, and T.B. Lawrence, "The impact of virtual
embeddedness on new venture survival: overcoming the liabilities of
newness". Entrepreneurship Theory & Practice, Vol. 31, No 2, 2007, pp
139-159.
[11] S. Bharadwaj, "A resource-based perspective on information technology
capability and firm performance, an empirical investigation". MIS
Quarterly, Vol. 24, No. 1, 2000, pp 169-196.
[12] H. Jiao, I.C. Chang, and Y. Lu, "The relationship on information
technology capability and performance: An empirical research in the
context of China-s Yangtze River Delta Region" in 2008 Proceeding
IEEE IEEM Conference, pp 872-876.
[13] S. Lall, Learning from Asian Tigers, Macmillan Press, London, 1996.
[14] D. F. Feeny, and L.P. Willcocks, "Core IS capabilities for exploiting
information technology", Sloan Management Review, Vol. 39, No. 3,
1998, pp 9-21.
[15] S.M. Huang, C.S. Ou, C.M Chen, B. Lin, "An empirical study of
relationship between IT investment and firm performance: A resourcebased
perspective", European Journal of Operational Research, Vol.
173, 2006, pp 984-999.
[16] S. Mei, and M. Nie (2007), "Technological capability, marketing
capability and network capability: Keys to enhancing competitiveness
and improving performance-, in 2007 International Conference on
Management Science and Engineering (14th), Harbin, PR China, pp 728-
733.
[17] F.E. García-Muiña, and J.E Navas-López, "Explaining and measuring
success in new business: the effect of technological capabilities on firm
results, Technovation, Vol. 27, No. 1-2 , 2007, pp 30-46.
[18] R.S. Eckaus, The Creation of Technology Capability in Developing
Countries, London, Frances Pinter, 1991.
[19] National Research Council Canada, Increasing innovation capabilities of
Canada-s SMEs, Annual Report 2001-2002, 2002.
[20] C. Lin, and M. Chen, "Does innovation lead to performance? An
empirical study of SMEs in Taiwan", Management Research News, Vol.
30, No. 3, 2007, pp 115 - 132
[21] G.H Gaynor, Innovation by design: What It Takes to Keep Your
Company on the Cutting Edge, 2002.
http://books.google.com.my/books?+Innovation+by+design (as at 8
July, 2008)
[22] C. Gray, "Absorptive capacity, knowledge management and innovation
in entrepreneurial small firms", International Journal of Entrepreneurial
Behavior and Research, Vol. 12, No. 2, 2006, pp 345 - 360.
[23] P. Humphreys, R. McAdam, and J. Leckey, "Longitudinal evaluation of
innovation implementation in SMEs", European Journal of Innovation
Management, Vol. 8, No. 3, 2005, pp 283 - 304.
[24] R.P. Watson, F.P. Leyland, P. Berthon, and G. Zinkham, "U-Commerce:
Expanding the universe of marketing", Journal of the Academy of
Marketing Science, Vol. 30, No 4, 2002, pp 333-47.
[25] T. Volery, and D. Lord, "Critical success factors in online education",
International Journal of Educational Management, Vol. 14, No. 5,
2000, pp 216-223.
[26] C.Y. Woo, A. Cooper, W. Dunkelberg, U. Dallenbach, and W.J. Dennis,
"Determinants of growth for small and large entrepreneurial start-ups. In
R.H. Brockhaus, N.C. Churchill, J.A. Katz, B.A. Kirchoff, K.H. Vesper
& W.E. Werzel (Eds.), Frontiers of Entrepreneurship Research, 1989, pp
134-147, Boston: Babson College.
[27] R.L. Cochran, and R. Wood, "A corporate social responsibility and
financial performance", Academy of Management Journal, Vol. 27, No.
1, 1984, pp 42-56.
[28] N. Ibrahim, and L. Rue, "The relationship between planning
sophistication and performance in small business-, Journal of Small
Business Management, Vol. 36, No. 4, 1998, pp 24-32.
[29] F. Delmar, P. Davidsson, and W.B Gartner, "Arriving at the high-growth
firm", Journal of Business Venturing, Vol. 18, No. 2, 2003, pp189-216.
[30] P. Love, and Z. Irani, "An exploratory study of information technology
evaluation and benefits management practices of SMEs in the
construction industry", Information and Management, Vol. 42, No. 1,
2004, pp 227 - 242.
[31] M. Jonker, H. Romijn, and A. Szirmai, "Technological effort,
technological capabilities and economic performance. A case study of
the paper manufacturing sector in West Java", Technovation, 26, 2006,
pp 121-134
[32] C. Nakata, Z. Zhu and M. Kraimer, "The complex contribution of
information technology capability to business performance", Journal of
Managerial Issues, Vol. 20, No. 4, 2008, pp. 485-509.
[33] L. Kanuk, and C. Berenson, "Mail surveys and response rates: a literature
review-, Journal of Marketing Research, Vol. 12, 1975, pp 440-453.
[34] U. Sekaran, Research Methods for Business, 2nd ed., Wiley, New York,
1992.
[35] J.C. Nunnally, Psychometric Theory, 2nd ed., McGraw-Hill, New York,
1978.
[36] C. Fornell, and D. Larcker, "Structural equation models with
unobservable variables and measurement error-. Journal of Marketing
Research, Vol. 18, No. 1, 1981, pp 39-50.
@article{"International Journal of Business, Human and Social Sciences:63928", author = "Sulaiman Ainin and Yusniza Kamar ulzaman and Abdul Ghani Farinda", title = "An Assessment of Technological Competencies on Professional Service Firms Business Performance", abstract = "This study was initiated with a three prong objective.
One, to identify the relationship between Technological
Competencies factors (Technical Capability, Firm Innovativeness
and E-Business Practices and professional service firms- business
performance. To investigate the predictors of professional service
firms business performance and finally to evaluate the predictors of
business performance according to the type of professional service
firms, a survey questionnaire was deployed to collect empirical data.
The questionnaire was distributed to the owners of the professional
small medium size enterprises services in the Accounting, Legal,
Engineering and Architecture sectors. Analysis showed that all three
Technology Competency factors have moderate effect on business
performance. In addition, the regression models indicate that
technical capability is the most highly influential that could
determine business performance, followed by e-business practices
and firm innovativeness. Subsequently, the main predictor of
business performance for all types of firms is Technical capability.", keywords = "technology competency, technology capability,innovativeness, E-business practice", volume = "4", number = "6", pages = "1494-7", }
