Abstract
Despite the widespread adoption of technology in inventory management, empirical research that examines the effect of these technologies is scarce. Does IT capability really have a positive effect on the inventory management? This paper empirically studies the usage of information technology by the definition of IT capability. Our unique panel data set allows us to explore the relationship between technology usage and inventory management. Our results show that IT capability has a positive effect on the inventory strategy and inventory operation process, and has a negative effect on the out-of-stock level. Our research demonstrates the superiority of the usage of technology.
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