Study On The Influencing Mechanisms Of IT Governance On IT Capabilities In Manufacturing Enterprises

"The fusion of informationlization and industrialization” has been considered as animportant means to deal with serious challenges and achieve strategic transformation andupgrading for China’s manufacturing enterprises in this century. However, the applicationroad of information technology in Chinese manufacturing enterprises was not smooth. Manymanufacturing companies spent a huge IT investments, but found that there was no significantincrease in their information technology capabilities and competitiveness. Thus, strengthenthe IT governance has become the realistic choice and the urgent need for them. However,due to the study and practice of IT governance is far from mature, many manufacturingenterprises do not understand how IT governance affect the cultivation of IT capabilities. Andbecause of the lack of empirical evidence, the effectiveness of IT governance needs to beimproved. For many Chinese manufacturing enterprises, two problems need to focus onduring the application process of information technology, that is,“What IT capabilities needto nurture for manufacturing enterprises?”and “How IT governance affect the ITcapabilities?”. At the same time, these two issues also need to be resolved urgently in the ITgovernance practices of Chinese manufacturing industry.In this paper, following the research process, that is,"literature review—theoreticalanalysis—model construction—empirical test—case study", the reseach models are presentedby theoretical analysis and tested through a large sample questionnaire survey and a multicase study. The main innovative achievements are as follows:To solve the first problem, based on the characteristics and development trend ofinformation technology in manufacturing industry, this paper absorbs the essence of therelated studies on corporate competence theory. On this basis, through standardizedtheoretical reasoning, this paper analyzes the content and structure of IT capabilities inmanufacturing enterprises, and proposes a conceptual model of IT capabilities inmanufacturing enterprises, which decomposes the manufacturing IT capability into IT basiccapabilities, IT management capabilities and IT-enabled organizations’ core competencies.Among them, IT basic capabilities and IT-enabled organizations’ core competencies reflectthe state of business-IT alignment, IT management capabilities reflects the ability forenterprises to promote the process of the fusion of informationlization and industrialization，and the above three together reflect the dynamic changes in manufacturing IT capabilities. Onthe basis of literature analysis, exchange of experts and business research, the paper then builds the initial measurement scale of IT capabilities in manufacturing industry, and thenrefines and revises the measurement scale through exploratory factor analysis, and finallytests the reliability and validity of the scales through confirmatory factor analysis. On thisbasis, this paper forms the final measurement scale of IT capabilities in manufacturingindustry.To solve the second problem, this paper firstly interprets the IT governance inmanufacturing enterprises based on the Van Grembergen（2003） IT governance three-factormodel, then discusses the relationships among IT governance, IT capability, Business-ITalignment and enterprise architecture， on this basis， forms a five-group study assumptions，including： the relationship between IT governance and IT capabilities； the relationshipbetween IT governance and business-IT alignment； the relationship between business-ITalignment and IT capabilities； the mediating effect of business-IT alignment， and theregulating effect of Enterprise Architecture. On this basis, the author has constructed the threeresearch model of this paper based on resource-based view, that is, the direct influence modelof IT governance on IT capabilities， the indirect effects model of IT governance on ITcapabilities, and the regulation effects of Enterprise Architecture on the above two models.Finally, empirical testing of the proposed model is carried out by questionnaire survey andmultiple case study. The results show that:（1） three aspects of IT governance all havepositive impact on the three dimensions of IT capability, but the differences of the impactscannot be ignored. Relatively speaking, the positive impact of IT governance organizationalmechanisms on IT basic capabilities and IT-enabled organizations’ core competencies, thepositive impact of IT governance processes mechanisms on IT basic capabilities and ITmanagement capabilities, as well as the positive impact of IT governance relationshipmechanisms on IT basic capabilities and IT-enabled organizations’ core competencies aremore obvious.（2） IT Governance has a significant positive effect on Business-IT alignmentwhich，in the meanwhile, has a significant impact on IT Capabilities．Furthermore，Business-IT Alignment partially mediates the relationship between IT Governance and ITCapabilities.（3） Enterprise Architecture can regulate the direct and indirect influence of ITgovernance mechanisms on IT capabilities. In the former regulatory role, EA planningmaturity regulates the influence of IT governance mechanisms upon IT basic capabilities andIT-enabled organizations’ core competencies obviously, in the meanwhile, EA implementationmaturity regulates the influence of IT governance mechanisms upon IT basic capabilities and IT management capabilities significantly. In the latter regulatory role, EA planning maturityand EA implementation maturity regulate the impact of IT governance mechanisms onbusiness-IT alignment simultaneously.The research results of this paper provide valuable empirical evidence on the impact ofIT governance upon IT capabilities, making the cultivation of IT capabilities no longer stay onthe abstract discussion of concepts and theoretical framework, and make up for the lack oftraditional study on IT governance and IT capabilities. It not only extends the theoreticalperspective of IT governance and IT capabilities, but also provides valuable theoreticalguidance for the application and governance practices in Chinese manufacturing industry.