Abstract
INTRODUCTION: With the development of the digital economy, a multitude of firms have embarked on the path of digital transformation through information technology (IT). Scholars have called for attention to the mediating or moderating mechanisms of IT capability on firm performance. This study argues that further exploration is needed regarding the relationship between IT capability and firm performance. METHODS: This study obtained questionnaire data from 152 IT senior managers of randomly selected manufacturing firms. The data was used to empirically test the proposed hypotheses using hierarchical regression analysis. RESULTS: The results showed that IT capability has a positive effect on firm performance directly and indirectly via knowledge stock and knowledge process. Moreover, organizational culture management moderates the relationship between knowledge stock/knowledge process, and firm performance. DISCUSSION: This study proposes the "resources-knowledge-performance" mechanism, which sheds light on the "black box" of how IT capability affects firm performance. This enriches the research on knowledge from different perspectives and the the research on organizational culture by discussing the moderating role of organizational culture management in the relationship between knowledge stock/process and firm performance. Our research also has important managerial implications to firm.