• Wiwik - Supratiwi Departemen Akuntansi FEB - UNAIR
  • Dian Agustia Departemen Akuntansi FEB - UNAIR



Information technology investment, organizational transformation, organizational performance


The purpose of this research is to examine the role of organizational transformation in mediating the effect of Information Technology (IT) investments on organizational performance in local governments. This research is expected to assist local governments to implement IT effectively to improve their organizational performance. This research is designed as quantitative research. The unit of analysis of this study is the district/ city level. The research sample is 38 districts/ cities in East Java province using convenience samples due to the limitations of time, cost, and access to data collection. Data used are primary data collected through questionnaires to respondents from the determined Local Government Agencies in each sample district/ city. The data analysis of this study uses SEM-PLS because it can be used for the small number of samples and can predict complex models. Data processing using the Warp PLS 6.0 software application. This study uses the second-order construct model with reflective first-order and second-order. Variables are measured by using a 1-7 semantic differential scale. The theory used is the process theory with teleology typology. This study found that organizational transformation mediates partially the effect of IT investment on organizational performance in local governments. Future studies may add other mediation variables and use the different measurements for each latent variable, to test the consistency of the results of this study.



Alaaraj, H. dan F. W. Ibrahim. 2014. The Influence of E-government Practices on Good Governance from the Perspective of Public in Lebanon. Journal of Public Administration and Governance 4(3): 171-185.

Alenezi, H., A. Tarhini, dan R. Masa'deh. 2015. Investigating the strategic relati- onship between information quality and e-government benefits: A literature review.

Aral, S. dan P. Weill. 2007. IT assets, organizational capabilities, and firm performance: How resource allocations and organizational differences explain performance variation. Organization science 18(5): 763-780.

Baker, J., J. Song, dan D. R. Jones. 2017. Closing the loop: Empirical evidence for a positive feedback model of IT business value creation. The Journal of Strategic Information Systems 26(2): 142-160.

Burton-Jones, A., E. R. McLean, dan E. Monod. 2015. Theoretical perspectives in IS research: from variance and process to conceptual latitude and conceptual fit. European Journal of Information Systems 24(6): 664-679.

Cha, K. J., T. Hwang, dan S. Gregor. 2015. An integrative model of IT-enabled organi- zational transformation: A multiple case study. Management Decision 53(8): 1755-1770.

Coombs, C. R. 2015. When planned ISatauIT project benefits are not realized: a study of inhibitors and facilitators to benefits realization. International Journal of Project Management 33(2): 363-379.

Cordella, A. dan N. Tempini. 2015. E-government and organizational change: Reappraising the role of ICT and bureaucracy in public service delivery. Government information quarterly 32(3): 279-286.

Criado, J. I., F. Rojas-Martín, dan J. R. Gil-Garcia. 2017. Enacting social media success in local public administrations: An empirical analysis of organizational, institutional, and contextual factors. International Journal of Public Sector Management 30(1): 31-47.

Dikert, K., M. Paasivaara, dan C. Lassenius. 2016. Challenges and success factors for large-scale agile transformations: A systematic literature review. Journal of Systems and Software 119: 87-108.

Ebrahimi, P., S. M. Moosavi, dan E. Chirani. 2016. Relationship between leadership styles and organizational performance by considering innovation in manu- facturing companies of guilan province. Procedia-Social and Behavioral Sciences, 230: 351-358.

Etikan, I., S. A. Musa, dan R. S. Alkassim. 2016. Comparison of convenience sampling and purposive sampling. American journal of theoretical and applied statistics 5(1): 1-4.

Fernandez, S. dan H. G. Rainey. 2017. Managing successful organizational change in the public sector Debating Public Administration, 7-26: Routledge.

Fritz, M. S., D. A. Kenny, dan D. P. MacKinnon. 2016. The combined effects of measurement error and omitting confounders in the single-mediator model. Multivariate Behavioral Research 51(5): 681-697.

Gao, P. 2015. Government in the catching-up of technology innovation: Case of administrative intervention in China. Technological Forecasting and Social Change 96: 4-14.

Gil-Garcia, J. R., N. Helbig, dan A. Ojo. 2014. Being smart: Emerging technologies and innovation in the public sector. Government information quarterly 31: I1-I8.

Greve, C. 2015. Ideas in public management reform for the 2010s. Digitalization, value creation and involvement. Public organization review 15(1): 49-65.

Hair, J. F., W. C. Black, B. J. Babin, dan R. E. Anderson. 2014. Multivariate data analysis: Pearson new international edition. Essex: Pearson Education Limited.

Hair Jr, J. F., G. T. M. Hult, C. Ringle, dan M. Sarstedt. 2016. A primer on partial least squares structural equation modeling (PLS-SEM): Sage publications.

Hair Jr, J. F., L. M. Matthews, R. L. Matthews, dan M. Sarstedt. 2017. PLS-SEM or CB-SEM: updated guidelines on which method to use. International Journal of Multivariate Data Analysis 1(2): 107-123.

Hernes, T. 2014. A process theory of organization: OUP Oxford.

Hinings, B., T. Gegenhuber, dan R. Greenwood. 2018. Digital innovation and transformation: An institutional perspective. Information and Organization 28(1): 52-61.

Hossan, C. 2015. Applicability of Lewin's change management theory in Australian local government. International Journal of business and Management 10(6): 53.

Jacobsen, J., H. B. Fosse, dan A. Sorensen. 2017. IT‐Intensive Machinery and Equipment, Organizational Change and Productivity Growth. Organizational Change and Productivity Growth (May 31, 2017).

Janowski, T. 2015. Digital government evolution: From transformation to contextualization. Government information quarterly 32(3): 221-236.

Jung, B. 2019. A Performance by New Technology Investment and Legal System Operation in Government Organization. Journal of Digital Conver- gence 17(6): 133-144.

Kenny, D. 2014. Mediation. 2014.

Khallaf, A., M. A. Omran, dan T. Zakaria, 2017. Explaining the inconsistent results of the impact of information technology investments on firm performance: A longitudinal analysis. Journal of Accounting & Organizational Change, 13(3): 359-380.

Kobelsky, K., G. Larosiliere, dan E. Plummer. 2014. The impact of information techno- logy on performance in the not-for-profit sector. International Journal of Accounting Information Systems 15(1): 47-65.

Kuhlmann, S. 2010. Performance Measurement in European local governments: a comparative analysis of reform experiences in Great Britain, France, Sweden and Germany. International Review of Administrative Sciences 76(2): 331-345.

Laudon, K. C. dan J. P. Laudon. 2018. Management information systems: mana- ging the digital firm (Fifteenth Edition Global Edition ed.): Pearson.

Lee, O. K. D. 2012. IT-enabled organizational transformations to achieve business agility. The Review of Business Information Systems (Online) 16(2): 43.

Loebbecke, C. dan A. Picot. 2015. Reflections on societal and business model transformation arising from digitization and big data analytics: A research agenda. The Journal of Strategic Information Systems 24(3): 149-157.

Maal-Gharaibeh, S. dan N. M. Malkawi. 2013. The impact of management information systems on the performance of governmental organizations-study at Jordanian ministry of planning. International Journal of Business and Social Science 4(17).

Markus, M. L. dan D. Robey. 1988. Information technology and organizational change: causal structure in theory and research. Management science 34(5): 583-598.

Mohr, L. B. 1982. Explaining organizational behavior (1): Jossey-Bass San Francisco, CA.

Nielsen, J. A. dan Pedersen, K. 2014. IT portfolio decision-making in local governments: Rationality, politics, intuition and coincidences. Government information quarterly 31(3): 411-420.

Nitzl, C., J. L. Roldan, dan G. Cepeda. 2016. Mediation analysis in partial least squares path modeling: Helping researchers discuss more sophisticated models. Industrial Management & Data Systems 116(9): 1849-1864.

Nograšek, J. dan M. Vintar. 2014. E-government and organisational trans- formation of government: Black box revisited? Government Information Quarterly 31(1): 108-118.

Nwankpa, J. K. dan Y. Roumani. 2016. IT capability and digital transformation: A firm performance perspective.

O’Rourke, H. P. dan D. P. MacKinnon. 2018. Reasons for testing mediation in the absence of an intervention effect: A research imperative in prevention and intervention research. Journal of studies on alcohol and drugs 79(2): 171-181.

Pang, M. S. 2014. IT governance and business value in the public sector organizations - The role of elected representatives in IT governance and its impact on IT value in US state governments. Decision Support Systems 59: 274-285.

Peng, J., J. Quan, G. Zhang, dan A. J. Dubinsky. 2016. Mediation effect of business process and supply chain management capabilities on the impact of IT on firm performance: Evidence from Chinese firms. International Journal of Information Management 36(1): 89-96.

Plesner, U., L. Justesen, dan C. Glerup. 2018. The transformation of work in digitized public sector organizations. Journal of Organizational Change Management 31(5): 1176-1190.

Republik Indonesia. 2016. Peraturan Pemerintah Republik Indonesia Nomor 18 Tahun 2016 tentang Organisasi Perangkat Daerah.

. 2018. Peraturan Presiden Nomor 95 Tahun 2018 tentang Sistem Pemerintahan Berbasis Elektronik.

. 2019. Peraturan Pemerintah Republik Indonesia Nomor 12 Tahun 2019 tentang Pengelolaan Keuangan Daerah.

Ribeiro, M. M., E. H. Diniz, L. C. Oliveira, dan S. M. Faleiros. 2018. Information systems and intergovernmental relations in Brazilian social policies: a study on users’ adaptations to the local context. RAUSP Management Journal 53(1): 86-97.

Romanelli, E. dan M. L. Tushman. 1994. Organizational transformation as punctuated equilibrium: An empirical test. Academy of Management Journal 37(5): 1141-1166.

Rowe, F., P. Besson, dan A. Hemon. 2017. Socio-technical inertia, dynamic capabilities and environmental uncertainty: Senior management views and implications for organizational transformation.

Sabherwal, R. dan A. Jeyaraj. 2015. Information Technology Impacts on Firm Performance: An Extension of Kohli and Devaraj (2003). MIS quarterly 39(4): 809-836.

Sharma, P., M. Sarstedt, G. Shmueli, K. H. Kim, dan K. O. Thiele. 2019. PLS-based model selection: the role of alternative explanations in information systems research. Journal of the Association for Information Systems 20(4): 4.

Sivarajah, U., Z. Irani, dan V. Weerakkody. 2015. Evaluating the use and impact of Web 2.0 technologies in local government. Government information quarterly 32(4): 473-487.

Smith, H. A. dan J. McKeen. 1991. How does information technology affect business value-A reassessment and research propositions. Paper presented at the System Sciences, 1991. Proceedings of the Twenty-Fourth Annual Hawaii International Conference on.

Soh, C. dan M. L. Markus. 1995. How IT creates business value: a process theory synthesis. ICIS 1995 Proceedings, 4.

Teryima, S. J. dan A. Sunday. 2015. The role of information communication techno- logy (ICT) in enhancing productivity in local government administration in Benue State, Nigeria. International Journal of Business and Economic Develop- ment (IJBED): 3(1).

Van de Ven, A. H. 1992. Suggestions for studying strategy process: A research note. Strategic management journal 13(5), 169-188.

Van de Ven, A. H. dan M. S. Poole. 1995. Explaining development and change in organizations. Academy of management review 20(3): 510-540.

Van de Ven, A. H. dan K. Sun. 2011. Breakdowns in implementing models of organization change. Academy of Mana- gement Perspectives 25(3): 58-74.

Welch, E. W. dan M. K. Feeney, M. K. 2014. Technology in government: How organizational culture mediates information and communication technology outcomes. Government information quarterly 31(4): 506-512.

Yang, C., Y. D. Wang, dan H. J. Niu. 2007. Does industry matter in attributing organizational learning to its performance?: Evidence from the Taiwanese economy. Asia Pacific Business Review, 13(4): 547-563.

Zeng, D., T. H. Ouyang, N. Zhou, dan J. Hu. 2015. The role of embeddedness in achieving IT-enabled organizational transformation: A case of Xi’an Aero-Engine PLC (XAEP), China. International Journal of Information Management 35(5): 632-635.

Zikmund, W. G., S. D'Alessandro, H. Winzar, B. Lowe, dan B. Babin. 2017. Marketing Research: Asia-Pacific Edition: Cengage AU.