The effects of IT application orchestration capability on performance

This paper investigates the effects on performance of a firm's capability to orchestrate its portfolio of IT applications. It conceives of IT application orchestration as a dynamic capability and develops a model where the effects of this capability on performance are mediated by an important IT-enabled business outcome: Process agility. Results from an international survey of IT executives show that IT application orchestration capability has a direct positive effect on agility, which in turn improves performance. Further, we show that agility fully mediates the effect of IT application orchestration capability on performance. This paper extends prior theory by proposing and testing for the performance effects of an IT-enabled dynamic capability that has not been previously investigated. The implication of this study for practice is to show that the benefits generated by managing the portfolio of IT applications are realized at the process-level and result in increased firm performance.