MEDIATING EFFECT OF INFORMATION TECHNOLOGY CAPABILITY ON THE RELATIONSHIP BETWEEN DIGITAL BUSINESS STRATEGY AND BUSINESS PERFORMANCE AMONG COMMERCIAL BANKS IN BAUCHI STATE
Nabila Aliyu Dauda, Wasilu Suleiman, PhD, Ibrahim Aliyu, PhD, Kamalu Ali Bello and Sani Abdulsalam
Volume 14 Issue 2
Abstract
This study examined the mediating effect of Information Technology Capability (ITC) on the relationship between Digital Business Strategy (DBS) and Business Performance (BP) among commercial banks in Bauchi State, Nigeria. Specifically, the study investigated the influence of digital marketing, digital transformation, and digital analytics on business performance, as well as the mediating role of IT capability in these relationships. A cross-sectional survey research design was adopted, and data were collected from employees of eight selected commercial banks operating in Bauchi State. From a target sample of 312 respondents, 267 valid questionnaires were retrieved and analyzed, representing an 85.6% response rate. Data analysis was conducted using Partial Least Squares Structural Equation Modeling (PLS-SEM 4). The findings revealed that digital marketing (β = 0.528, p < 0.001) and digital transformation (β = 0.147, p < 0.001) have significant positive effects on business performance, while digital analytics (β = 0.066, p = 0.078) showed no significant direct effect. The coefficient of determination (R² = 0.521) indicated that digital business strategy dimensions explained 52.1% of the variance in business performance. The mediation analysis further revealed that IT capability significantly mediates the relationship between digital marketing and business performance (β = 0.295, p < 0.001) as well as between digital analytics and business performance (β = 0.560, p < 0.001). However, IT capability did not significantly mediate the relationship between digital transformation and business performance (β = 0.101, p = 0.192). The study recommends that commercial banks invest in robust IT infrastructure, staff digital competencies, and integrated digital platforms to maximize the benefits of digital business strategies and enhance overall business performance. Keywords: Digital Business Strategy, Digital Marketing, Digital Transformation, Digital Analytics, Information Technology Capability, Business Performance, Commercial Banks.
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