| Summary: | The purpose of this thesis is to explore the link between IS capabilities and operational performance in services. More specifically, it aims to investigate how the processes for supplier and customer integration affect IS capabilities and consequently, firms’ operational performance. Accordingly, this study examines the effects of three dimensions of IS capabilities (IT for supply chain activities, flexible IT infrastructure, and IT operations shared knowledge) on cost and quality performance via the mediation of the processes developed for supplier and customer integration in service firms. This is achieved by measuring SCI in terms of supply side integration processes (supplier integration) as well as customer side integration processes (customer transactions, customer connection, and customer collaboration). A survey-based research design intended to measure the estimated relationships was adopted. Data were collected from 156 service establishments in the UK. Mediated multiple regression analysis revealed that integrating specific processes with supply chain members (supplier integration, customer transactions, customer connection, and customer collaboration) can fully or partially mediate the effects of IT for supply chain activities and IT operations shared knowledge on cost and quality performance; no support was found for the relationships between flexible IT infrastructure and cost and quality performance. These results provide a valuable explanation to academics as well as to practitioners regarding the importance of various processes developed for integration with supply chain members in leveraging IS for operational performance in services. This thesis takes a step towards quelling concerns about the business value of IS, contributing to the development and validation of the measurement of IS capabilities in the service operations context. Additionally, it adds to the emerging body of literature linking supply chain integration to the operational performance of service firms.
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