The Role of Information Systems in Promoting Strategic Agility in Supply Chains

Abstract

The prevalent volatile business environment is exerting pressure on companies to change fast for survival- a need to be strategically agile. This need is more pronounced for supply chains of companies as at least two organizations have to collaborate, communicate, and coordinate their supply chain activities effectively to adequately address environment threats and take advantage of opportunities. Strategic agility is an essential requirement for supply chains to survive in the competitive environment. Strategic agility is comprised of three dimensions — strategic sensitivity, strategic response and collective capabilities. Companies can take advantage of the advances in information technology and information systems to enhance strategic agility. This research highlights how information systems (IS) can bolster the three dimensions of strategic agility in supply chains. A normative description approach is utilized for two companies — IKEA and Kesko to analyze the role of IS in SC strategic agility. The results show that IS, such as advances in social technologies, could be utilized for enhancing strategic agility dimension of collective capabilities. IS, such as data mining systems are vital for promoting strategic sensitivity with supply chain partners downstream i.e., customers. For supply chain upstream, where products are formulated, IS such as business process management systems are required to support strategic response.