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Efficient working capital management is an essential component of overall corporate strategy to boost shareholders value. The aim of our study is to examine the relationship between working capital management and profitability of Pakistani firms listed on Karachi Stock Exchange for a period of 6 years during 2008-2013. Correlations analysis using panel data and panel least square was conceded to check the impact of working capital management on profitability. The study found considerable negative relationship between the measure of profitability and Average Payment Period, Average Collection period, Inventory turnover in days, Cash conversion cycle and Debt while positive relationship was found between ROA and Size, GDPGR and Sales growth of Pakistani firms. The study suggests that shareholders wealth can be maximize by well-organized management of working capital. The study suggest that managers can improve the profitability and value of their firms by dropping accounts receivable days, accounts payable days, inventory turnover in days and also make substantial efforts towards maintaining an optimal cash conversion cycle level.

In the contemporary and perpetually changing environment, firms have transformed their business models by integrating advanced digital technologies in which their capabilities contribute crucially. This has evoked competition and challenges especially for small and medium-sized enterprises (SMEs). Therefore, the research aimed to analyze the mediating effect of information technology (IT) capability between digital business strategy and firms’ efficiency. The case of Chinese SMEs was considered specifically. The research was quantitative; therefore, the sample comprised 351 participants accumulated using a survey questionnaire. The mediating effect was tested using structural equation modeling (SEM) where partial mediation of the IT capability was found only in terms of IT proactive stance. Therefore, the research has certain managerial implications specifically in terms of proactive stance as the managers need to initiate the transformation within for efficient performance.

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