The Effects of Environmental Factors and IT Investment on Organizational Performance through Innovation Capabilities and Disruptive Innovation Management in the Electronics Industry

Abstract

Thailand’s electronics industry has been influenced by the competitive environment, especially the impacts of fast changing information technology and high business competition in supporting information technology investment in organization. This research aimed to study the effects of environmental factors and IT investment on organizational performance through innovation capabilities and disruptive innovation management of the electronics industry in Thailand. A questionnaire was administered to 255 electronics manufacturing companies listed in the Department of Business Development, Ministry of Commerce. The data were analyzed by descriptive statistics and the structural equation model (SEM) to find out the relationship between the variables and to test the hypotheses. The results revealed that environmental factors had no positive impact on innovation capabilities, but were positively correlated with disruptive innovation management. They also indirectly affected organizational performance through disruptive innovation management. On the other hand, IT investment was positively correlated with innovation capabilities, but had no positive impact on disruptive innovation management. These implied that companies must pay attention to cross functional integration for manufacturing products and services to meet the customers’ needs. The findings also suggested that organizations analyze the competitive environment, especially technological and innovation impacts as well as information technology and innovation investment. This will support and create the competitive opportunities through capabilities of innovation and disruptive innovation management.