The Role of Business Analytics Competency in Stabilizing Absorptive Capacity and Agility, and Improving Digital Innovation in Knowledge-based Enterprises

ObjectiveIn recent years, technological advancements and the growing emphasis of developed countries on sustainable value creation have accelerated the emergence of knowledge-based enterprises (KBEs) and fostered the expansion of sustainable wealth generation in these economies. Notably, KBEs operating in the ICT sector have played a pivotal role in the economic growth and development of leading nations. However, recent developments in global markets, particularly changes in customer interactions, and the regulations governing the business environment, have altered the perspectives of these businesses regarding value-creation methods. By understanding this strategic inflection point in business, KBEs are increasingly focused on identifying and acquiring new organizational capabilities to enhance their performance. In this context, this study investigates the impact of business analysis competence (BAC) on digital innovation (DI), elucidating the mediating roles of absorptive capacity (AC) and firm agility (FA). MethodologyThe research is applied in nature and employs a descriptive-survey methodology for data collection. The statistical population comprises 2,084 KBEs operating within the information and communication technology (ICT) and computer software sectors. A sample size of 391 KBEs was determined using G-Power 3.1 software. Data was collected online through a standardized questionnaire. The research model was analyzed utilizing structural equation modeling techniques in Smart PLS 3 software. FindingsFindings indicate that BAC positively and significantly influences AC, FA, and DI. The study also confirms the positive effects of AC on FA and both AC and FA on DI. While the mediating role of AC is affirmed, the mediating role of FA is rejected. ConclusionThis study contributes to the existing literature in multiple ways, offering both theoretical and managerial insights. Theoretically, it advances the field by integrating three key frameworks: the dynamic capabilities' perspective, AC theory, and the process theory of change, thereby emphasizing their interrelated significance. The present study highlights the role of BAC in enhancing capabilities such as AC and FA. It also demonstrates the significance of these two variables as complementary strategies in fostering and improving DI within KBEs. The results lend credence to the theoretical findings through a quantitative investigation and demonstrate that any form of innovation in KBEs requires simultaneous interaction between complementary capabilities and functional competencies. Furthermore, this study takes a significant step toward advancing human knowledge by simultaneously examining the mediating roles of AC and FA in the relationship between BAC and DI for the first time. As a result, it enriches the literature in this field. From a managerial perspective, the findings suggest that leaders of KBEs in the ICT sector should recognize that enhancing DI significantly relies on fostering conditions that improve processes related to AC and FA. To achieve this goal, these companies must prioritize investments in business analytics knowledge, tools, and operations.