The Impact of ERP Assimilation on Mass Customization Capability: A Dynamic Capabilities View

Abstract

Mass customization (MC) is a crucial strategy for manufacturers to gain competitive advantages. Enterprise resource planning (ERP) systems are widely adopted in manufacturing. This study applied the dynamic capabilities view (DCV) to explore how firms leverage ERP systems to facilitate the implementation of MC. This study examined the effect of ERP assimilation (ERPA) and organizational agility (OA) on mass customization capability (MCC), the mediating role of OA, and the moderating role of absorptive capacity (AC). Data were collected using a self-administered questionnaire survey that yielded 166 responses in Jiangsu province, China. The partial least square structural equation modelling (PLS-SEM) approach was employed to test the study hypotheses. Results revealed that ERPA affects OA, and OA also affects MCC. However, no significant relationship was found between ERPA and MCC. Again, data supported the mediating effect of OA between ERPA and MCC and the moderating effect of AC between ERPA and OA.