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Business analytics-enabled decision-making effectiveness through knowledge absorptive capacity in health care

Yichuan Wang (Newcastle University Business School, Newcastle University, UK)
Terry Anthony Byrd (Auburn University, Auburn, Alabama, USA)

Journal of Knowledge Management

ISSN: 1367-3270

Article publication date: 8 May 2017




Drawing on the resource-based theory and dynamic capability view, this paper aims to examine the mechanisms by which business analytics (BA) capabilities (i.e. the effective use of data aggregation, analytics and data interpretation tools) in healthcare units indirectly influence decision-making effectiveness through the mediating role of knowledge absorptive capacity.


Using a survey method, this study collected data from the hospitals in Taiwan. Of the 155 responses received, three were incomplete, giving a 35.84 per cent response rate with 152 valid data points. Structural equation modeling was used to test the hypotheses.


This study conceptualizes, operationalizes and measures the BA capability as a multi-dimensional construct that is formed by capturing the functionalities of BA systems in health care, leading to the conclusion that healthcare units are likely to obtain valuable knowledge through using the data analysis and interpretation tools effectively. The effective use of data analysis and interpretation tools in healthcare units indirectly influence decision-making effectiveness, an impact that is mediated by absorptive capacity.


This study adds values to the literature by conceptualizing BA capabilities in healthcare and demonstrating how knowledge absorption matters when implementing BA to the decision-making process. The mediating role of absorptive capacity not only provides a mechanism by which BA can contribute to decision-making practices but also offers a new solution to the puzzle of the IT productivity paradox in healthcare settings.



A previous version of the paper was presented at the 2015 Pre-ICIS (International Conference on Information Systems) SIG GlobDev 8th Annual Workshop, Fort Worth, Texas, December 13, 2015. The authors are very thankful to the attendants in this workshop for the valuable feedback received. The authors also would like to acknowledge Ms Muyin Lo from a southern medical center in Taiwan and Dr Chiahui Yu from National Chengchi University who assisted in the data collection.


Wang, Y. and Byrd, T.A. (2017), "Business analytics-enabled decision-making effectiveness through knowledge absorptive capacity in health care", Journal of Knowledge Management, Vol. 21 No. 3, pp. 517-539.



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