Abstract:
Firm performance is a critical metric for businesses across industries, as it directly
impacts efficiency, customer satisfaction, and profitability. Securing firm
competitiveness and improved performance, supply chain digitalization are identified
as strategic tools for firms to improve their operations. From the previous studies
there has been inadequate linkage of supply chain digitalization with other themes.
This study sought to establish the moderating effect of supply chain agility on the
relationship between supply chain digitization and firm performance of government
state corporations in Nairobi County, Kenya. The specific objectives were to
determine the effect of electronic tendering, enterprise resource planning, cloud
computing, artificial intelligence on firm performance, as well as the moderating
effect of supply chain agility on each of the relationships. The study was informed by
Resource-Based View Theory, Stakeholder Engagement Theory, and the Technology
Acceptance Model (TAM). Anchoring on explanatory research design, the study
targeted 411 registered state corporations in Nairobi County under Kenya National
Bureau of Statistics. A sample size of 203 firms were selected using stratified and
simple random sampling approaches after subjecting the target population to Borg and
Gall formula. Data was collected using structured questionnaires and items were
anchored on a five-point Likert scale. Data was analyzed using both descriptive and
inferential statistics. The hypotheses were tested using hierarchical regression analysis
and Hayes process macro for moderation. The regression results indicated that
electronic tendering (β=0.636, p<0.05) and enterprise resource planning (β=0.178,
p<0.05) and cloud computing (β=0.157, p<0.05) and artificial intelligence (β=0.276,
p<0.05) had a positive and significant effect on firm performance. Furthermore, the
conditional effect results indicate that supply chain agility moderates the relationship
between; electronic tendering (β=0.787, p<0.05, ΔR2=0.002), enterprise resource
planning (β=0.247, p<0.05, ΔR2=0.004), cloud computing (β=0.317, p<0.05,
ΔR2=0.018), artificial intelligence (β=0.213, p<0.05, ΔR2=0.075) and firm
performance. Therefore, this study concludes that electronic tendering, enterprise
resource planning, cloud computing and artificial intelligent effectively enhances firm
performance. Thus, there is need for firm managers to understand and find ways to
effectively manage these interactions between supply chain digitalization and supply
chain agility in order to improve performance. Theoretically, the study supported the
incorporation of different key dimensions of between supply chain digitalization and
supply chain agility where the outcome of the results indicated the strong relationship
in achieving superior performance. In addition, the study emphasizes the importance
of promoting digital transformation and fostering supply chain agility to enhance
operational efficiency and competitiveness in state corporations. Therefore, there is
need for building long-term relationships both upstream and downstream in the
supply chain, enabling firms to learn, transform acquired knowledge, improve
operational processes, and deliver high-quality services that meet customer
expectations and satisfaction.