Information Systems Management

ISSN: (Print) (Online) Journal homepage: https://www.tandfonline.com/loi/uism20

Developing Business Risk Resilience through Risk

Management Infrastructure: The Moderating Role
of Big Data Analytics

Nitya Singh

To cite this article: Nitya Singh (2020): Developing Business Risk Resilience through Risk
Management Infrastructure: The Moderating Role of Big Data Analytics, Information Systems
Management, DOI: 10.1080/10580530.2020.1833386

To link to this article: https://doi.org/10.1080/10580530.2020.1833386

Published online: 16 Nov 2020.

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INFORMATION SYSTEMS MANAGEMENT
https://doi.org/10.1080/10580530.2020.1833386

Developing Business Risk Resilience through Risk Management Infrastructure:

The Moderating Role of Big Data Analytics
Nitya Singh
Assistant Professor of Management. Department of Management and Marketing. Franklin P. Perdue School of Business, Salisbury University,
MD, USA

ABSTRACT KEYWORDS
This article evaluates how firms are able to enhance the effectiveness of their Risk Management Big Data Analytics; IT
Infrastructure (RMI) by using Big Data Analytics (BDA) to improve their risk resilience capability. Infrastructure capability; IS
A theoretical model is developed and the corresponding hypothesis is tested through a survey strategy; Risk Management
Infrastructure; Business Risk
instrument and quantitative analysis. The results show that if firms adopt BDA capabilities then it
Resilience
positively moderates the impact of RMI on risk resilience, improving the effectiveness of a risk
management infrastructure.

Introduction
strategic thrust by organizations to enhance their IT
Over the past two decades as firms have increasingly infrastructure has been their focus on developing big
globalized their business operations, they have also wit­ data analytics (BDA) capability (Gillon et al., 2014;
nessed a corresponding growth in the variety of business Mithas et al., 2012; R. Sharma et al., 2014). The primary
risks being experienced by them. These risks have at times reason for such an initiative has been the growing man­
translated into business disruption events resulting in the agerial and academic awareness of the benefits accrued
affected firms facing financial, operational, and reputa­ to firms by adoption of business analytics and related
tional loss (Singh, 2020). Therefore in recent years scho­ technologies (Olszak & Zurada, 2020; R. Sharma et al.,
lars have increasingly focused on developing a better 2014; Wang, Kung, Cegielski et al., 2018). However, in-
understanding of how organizations can reduce the spite of the benefits that firms accrue from adoption of
adverse influence of business risk events on firm perfor­ BDA capabilities, academic research on topics related to
mance (R. Sharma et al., 2014; Wang, Kung, Cegielski BDA adoption and effectiveness is still in its infancy.
et al., 2018), while simultaneously developing competitive One major area that has not been explored in detail is
capabilities within the organization to achieve business the relationship between big data analytics, and its
success (Kane et al., 2015). Although there exist several impact on organizational ability to achieve business
perspectives on how firms can manage the business risks risk resilience (RiskRes) (Kitchens et al., 2018).
that they are exposed to, the role of Information Systems Although there exists several pathways that can be
(IS) as a strategic tool to achieve superior firm perfor­ followed by an organization to develop business risk
mance has continued to be a focus of scholarly attention resilience, the development of a certain few competitive
(Bharadwaj, 2000; Chae et al., 2014; Kohli & Devaraj, capabilities such as a risk management infrastructure
2003; Melville et al., 2004). The literature on IS strategy (RMI) has been empirically proven to be more effective
has therefore grown significantly in recent years, with than others (S. Ambulkar et al., 2016; Kocabasoglu et al.,
scholars now considering IS strategy as an important 2007). A RMI is a resource framework that an organiza­
element of a company’s business strategy (Drenevich & tion implements to manage risk and prevent business
Crososn, 2013; Pröllochs & Feuerriegel, 2020). disruption (Saurabh Ambulkar et al., 2015). Since a RMI
As firms have developed their Information includes technological capabilities to develop actionable
Technology (IT) capabilities as an element of their over­ intelligence from business information, its effectiveness
all IS strategy, they have also continued to stay abreast of might be increased if BDA capabilities are incorporated
major technological developments within the IT domain within its structure. However, the relationship between
and incorporate them as part of their organizational IT IT infrastructure capabilities (ITIC), RMI, BDA, and
infrastructure. Over the last decade, one key area of business risk resilience remains under-studied within

CONTACT Nitya Singh [email protected] Perdue School of Business, Salisbury University, Salisbury, MD, 21804, USA
© 2020 Taylor & Francis
2 N. P. SINGH

the literature. Therefore, the article aims to further information exchange capabilities (Bonner et al., 2002).
enhance our understanding of these connections and An organization that is able to organize and develop an
answer the research questions of (1) what is the relation­ effective resource structure will therefore be able to
ship between IT infrastructure capabilities, risk manage­ ensure continuous process improvements and conse­
ment infrastructure, and business risk resilience, and (2) quently prevent business failure (Revilla & Saenz,
what is the impact of BDA capabilities developed by 2017). When facing a disruption event, the presence of
a firm, on the relationship between RMI and emergence such an infrastructure empowers the organization to
of business risk resilience capability within an organiza­ take quick and decisive action, enabling it to mitigate
tion. To answer these research questions a review of the the negative business impact of such an event.
literature was initially undertaken to identify the asso­
ciated constructs, followed by the development of a Big data analytics (BDA) and business value
research model and corresponding hypotheses. To eval­ The development of new IT tools has enabled firms to
uate the hypothesized relationships, a survey instrument collect significant amount of data regarding their busi­
was used to contact senior and middle management ness operations (Jukić et al., 2015; R. Sharma et al.,
professionals and solicit their opinions regarding the 2014). In addition, the easy availability of tools for data
associated research questions. The final database used analysis, mining, and visualization has further allowed
in the study comprised of 213 usable responses from managers to synthesize the voluminous data collected by
nine different industry segments. Once the data collec­ their organizations (Davenport et al., 2010; R. Sharma
tion process was complete, quantitative methodology et al., 2014). However, in-spite of these developments
(factor analysis, as well as PROCESS-based regression organizations currently lack the capabilities required to
analysis) was used to analyze the survey responses and process the data collected by them, and to develop
examine the hypothesized relationships. The article con­ meaningful insights from it (Wang, Kung, Byrd et al.,
cludes with an analysis of the results, as well as identifies 2018). In response to such managerial challenges, scho­
theoretical and managerial implications of the study. lars have tried to identify how organizations can effec­
The results highlight that adoption of BDA capabilities tively harness the large volume of information inflows
by firms enables organizations to improve the effective­ into their firms by developing big data analytics capabil­
ness of their RMI, improving organizational capability ities (Božič & Dimovski, 2019; Davenport et al., 2010).
to manage risk and subsequently develop business risk This research focus has led scholars to suggest that
resilience. besides technological capability, companies should also
concentrate on developing competencies that can help
the firm develop BDA analytics capability (Gupta &
Theoretical background
George, 2016; McAfee & Brynjolfsson, 2012; Ross
Risk management infrastructure et al., 2013).
Scholars have defined risk management infrastructure as As BDA adoption and implementation by firms have
the presence of risk managers, the deployment of busi­ increased, scholars have started to highlight the need for
ness continuity plans, establishment of emergency developing an improved awareness of how BDA can
operations centers, and development of formal security assist firms in developing competitive capabilities
procedures that enable an organization to identify and (Abbasi et al., 2016; Olszak & Zurada, 2020; S. Sharma
mitigate business risks (Manuj et al., 2008; Sáenz & et al., 2016). The study of Big Data analytics is therefore
Revilla, 2014). This definition was further developed by extremely important as Big Data has the ability to trans­
Saurabh Ambulkar et al. (2015) when they defined risk form entire business processes (Mishra et al., 2018).
management infrastructure “as a resource structure that Although development of Big Data platforms requires
a firm has in place to manage risks and disruptions. wide-ranging infrastructure and human capital invest­
These resources include the presence of a department ment, from a long-term strategic perspective such an
to manage risks, the existence of information systems to investment will enable the firm to reap superior rewards
manage risks, and the use of key performance indicators and develop competitive advantage (Terziovski, 2010).
and metrics to monitor the risk management processes” However, in spite of all the benefits that arise from BDA
(Saurabh Ambulkar et al., 2015, p. 112). A risk manage­ capabilities it is important to understand the different
ment infrastructure is therefore a resource framework pathways by which BDA provides value to an organiza­
that enables firms to coordinate an organized response tion, especially from a macro and micro perspective
when it comes to managing business risk (Koen et al., (Loebbecke & Picot, 2015; Weibl & Hess, 2020).
2001). Furthermore, it also enables an organization to Scholars therefore argue that there exists a void within
improve task specialization and develop enhanced the literature when it comes to understanding how BDA
 INFORMATION SYSTEMS MANAGEMENT 3

can establish relationships between knowledge assets, a risk management infrastructure enables the organization
organizational ambidexterity, and firm operations to recognize and react proactively to business disruption
(Abbasi et al., 2016; Cantor et al., 2014), as well as incidences. The existence of such a risk mitigation capabil­
enables firms to achieve business risk resilience (Choi ity within an organization reduces the negative impact of
et al., 2016; G. Wang et al., 2016). a business disruption event on firm performance, and
enables the firm to develop business risk resilience.
Business risk resilience However, it is further argued that if companies adopt
Crisis scenarios occur unpredictably and induce firms to BDA capabilities, it enhances the efficacy of the risk man­
develop effective risk response mechanisms immediately agement infrastructure by positively moderating the impact
(Van de Walle & Turoff, 2008). Therefore, it is important of RMI on firm’s ability to achieve business risk resilience
for an organization to possess a risk mitigation outlook, also (Figure 1).
referred to as risk resilience capability. “The term ‘resilience’
has been used at the organizational level to describe the
Impact of IT infrastructure capability on business
inherent characteristics of those organizations that are able
risk resilience
to respond more quickly, recover faster, or develop more
unusual ways of doing business under duress than others. Within the last few years, the role of IT infrastructure
Resilience is generally seen as a desirable characteristic for capabilities has been a focus of significant scholarly atten­
an organization (and for its members) to possess in order to tion. Using several methodological approaches academics
deal with various types of adversity” (Linnenluecke, 2017, have attempted to evaluate the role played by IT infrastruc­
p. 4). Scholars therefore suggest that the process by which ture within an organization in enabling firms to improve
organizations react to business uncertainty plays an impor­ upon their financial performance, innovate, and develop
tant role in understanding whether firms are positively or functional and business strategies (Bartnik & Park, 2018;
negatively impacted by a disruption incident (Meyer, 1982; Singh & Singh, 2019). Scholars have defined IT infrastruc­
Staw et al., 1981). Weick and Roberts (1993) extend this ture capability as an organization’s capacity to effectively
viewpoint by suggesting that “organizations concerned exploit its technological, managerial, and technical IT
with reliability enact aggregate mental processes (informa­ resources to achieve business and strategic goals (Ajamieh
tion processes, needful action, and mindful attention) that et al., 2016; Y. Chen et al., 2014). Technological IT resources
are more developed than those in organizations that are refer to the physical IT infrastructure present in an organi­
primarily concerned with efficiency” (Weick & Roberts, zation (servers, computer laptops, software, electronic com­
1993, p. 357). Linnenluecke (2017) further argues that munication networks, etc.); whereas managerial IT
organizations are more likely to be resilient if permissive resources refer to business and technical skills of the firms
conditions are present as they attempt to develop sustain­ IT managers (Ajamieh et al., 2016). Technical IT resources
able capability that successfully utilizes internal and exter­ on the other hand comprise the technical and business skills
nal firm resources to resolve business concerns. of the firm’s IT employees (Yi Wang et al., 2015). ITIC can
therefore be understood as the base that the firm has for
sharing and processing information (Cepeda & Arias-
Construct development and hypothesis
Pérez, 2019). “This capability allows the company to iden­
Using the earlier discussed literature as the starting point, tify and develop key company applications, share product
relevant constructs are developed in the article and the and service information in different locations, process
corresponding theoretical model and hypotheses identified. transactions, and take advantage of synergy opportunities
The model incorporates two independent variables and among its business lines” (Cepeda & Arias-Pérez, 2019).
a moderating variable to understand how firms develop Huber (1990) was one of the early scholars to suggest
business risk resilience capability. The first independent that IT plays an important role in collaboration and
variable used in the study is IT infrastructure capabilities information sharing both inside and across organizational
(ITIC), while the second independent variable used is the boundaries. Building on this perspective Saeidi et al.
presence of a risk management infrastructure (RMI) within (2019) argue that IT infrastructure positively impacts an
an organization. BDA capabilities are used as a moderating organization’s ability to develop competitive advantage by
variable. The dependent variable identified in the model is enabling the firm to gather timely and relevant informa­
the emergence of business risk resilience (RiskRes) capabil­ tion. “Such information creates value for decision making
ity within an organization. With the help of these constructs in risk management as it helps the firm avoid repeating
and the hypothesized research model, it is argued that the the same mistakes. The information collected in such
presence of an IT Infrastructure capability allows a firm to a manner can help with analyzing risks and modeling;
build an efficient risk management infrastructure. Such monitoring risks and controlling; as well as risk
4 N. P. SINGH

Figure 1. Research model.

information and communication” (Saeidi et al., 2019, Furthermore, as the effectiveness of a risk management
p. 77). The influence of a company’s IT infrastructure infrastructure is based on the ability of risk managers work­
capabilities spreads across the firm’s value chain, and ing in emergency operations centers to make effective deci­
facilitates the firm in generating actionable information sions (Revilla & Saenz, 2017), IT infrastructure capabilities
to identify potential business risk events in a timely man­ also significantly improve the effectiveness of the risk man­
ner (Singh & Singh, 2019; Zhang & Dhaliwal, 2009). As agement infrastructure. Such a positive effect primarily
organizations improve their IT infrastructure capabilities, arises from the presence of technological tools that allows
they develop technological capabilities and services the risk management infrastructure to quickly identify and
throughout the firm (Kim et al., 2012). IT Infrastructure isolate potential problems within the organization’s busi­
capabilities are therefore the technological foundation of ness environment (S. Ambulkar et al., 2016; Kocabasoglu
an organization by which the firm ensures accurate, real- et al., 2007; Saurabh Ambulkar et al., 2015).
time, and comprehensive information for communica­ Consequently, when the firm faces a disruption event,
tion and decision making (Mao et al., 2016). ITIC enables the RMI allows the organization to take quick and deci­
boundary-spanning processes for efficient knowledge sive action that lessens the inimical influence of business
exchange, allowing decision makers access to actionable disruption events on firm performance (Choi et al.,
information for effective decision making (Tanriverdi, 2017). IT infrastructure capabilities therefore provide
2005). firms with tools to recognize threats from the business
Holling (1973) defined the term resilience as the capacity environment within which the organization operates (Yi
of a system to adapt to change and deal with surprise, while Wang et al., 2015), determine the influence of such risk
retaining the systems basic function and structure. Since IT events on the organization, develop strategies to reduce
infrastructure positively affects knowledge management the influence of business risk events (Tan et al., 2015),
capability within an organization (Mao et al., 2016), it and monitor the effectiveness of such strategies
allows managers access to actionable information enabling (Ajamieh et al., 2016). Based on these arguments it can
them to make prudent decisions that can mitigate the therefore be hypothesized that IT infrastructure capabil­
negative influence of disruption events on firm perfor­ ities positively impact the development of business risk
mance (Singh & Hong, 2020). In addition, with an updated resilience capability within the firm, as well as assists in
IT infrastructure companies are able to conduct effective the improved working of the risk management
environmental scanning allowing the firm to quickly iden­ infrastructure.
tify threats facing their business (Saeidi et al., 2019). Such
timely decision making ability developed in an organization H1: IT Infrastructure Capability (ITIC) positively
due to presence of an effective IT infrastructure allows the impacts the development of business risk resilience
firm to develop business risk resilience capability. (RiskRes) capability within a firm.
 INFORMATION SYSTEMS MANAGEMENT 5

H2: IT Infrastructure Capability (ITIC) positively in developing higher tolerance levels for business risk (S.
impacts the development of a risk management infra­ Ambulkar et al., 2016; Kocabasoglu et al., 2007; Saurabh
structure (RMI) within the organization. Ambulkar et al., 2015). Therefore, based on these perspec­
tives it can be argued that the development of a risk
management infrastructure will enable an organization
to develop business risk resilience capability. Hence
Influence of risk management infrastructure on
hypothesis three proposes that:
business risk resilience
The presence of a risk management infrastructure enables H3: A risk management infrastructure (RMI), will posi­
a company to develop systems and processes that assist tively impact the development of business risk resilience
the organization in identifying the multitude of risks (RiskRes) within an organization.
impacting the firm, as well as in developing risk treatment
prescriptions (Samson & Gloet, 2018). Such an infrastruc­
ture includes elements such as risk managers, the devel­
The moderating impact of big data analytics
opment, and deployment of business continuity plans,
capability
establishment of formal security procedures, and creation
of emergency operations centers to identify and manage Big Data Analytics is utilized by firms for various pur­
business risks (Manuj et al., 2008; Sáenz & Revilla, 2014). poses, including customer acquisition and retention,
The synergy that comes about when all the organizational improving operational performance, staffing, shift plan­
stakeholders work together plays an important role in ning, etc. (Abbasi et al., 2016; S. Sharma et al., 2016).
enabling firms to develop strategies that can help the However, for an organization to develop BDA capability
company in managing the impact of various internal it needs to (1) first of all develop a trained workforce that
and external risk events. Organizational risks therefore can efficiently examine, comprehend, and adopt BDA to
can be reduced not by individuals or specific risk manage­ develop actionable knowledge for strategic decision
ment strategies; but by improved teamwork, knowledge making (Marler & Boudreau, 2017; Rasmussen &
sharing, and joint problem solving (Cantor et al., 2014). Ulrich, 2015; Tambe, 2014); and (2) to build a physical
When faced with a disruption event, the presence of a infrastructure that can be utilized to capture BDA infor­
RMI enables the organization to take rapid and decisive mation from varied sources (Akter et al., 2016; Wang,
action thereby lowering the negative influence of such Kung, Cegielski et al., 2018). Based on these viewpoints
a disruption event on organizational performance (S. Gupta and George (2016) described BDA capabilities as
Ambulkar et al., 2016; Kocabasoglu et al., 2007; Saurabh consisting of tangible resources, intangible resources,
Ambulkar et al., 2015). and human capital resources. Using these classifications
Business risk resilience (RiskRes) on the other hand as a starting point, BDA capabilities can be defined as
refers to the existence of capabilities within firms that consisting of (i) BDA-focused human capital capability
enable the organization to respond quickly to, and recover (ii) hardware and software technologies specifically
faster from, business disruption events. Resilience is related to developing BDA capabilities and (iii) BDA-
therefore an organizational characteristic that is necessary focused knowledge management capabilities.
for a firm to acquire in order to manage the challenges Therefore, for a firm to develop BDA capabilities, it is
arising from various environmental risk factors necessary for it to simultaneously develop human capital
(Linnenluecke, 2017). Such a capability can develop capability, knowledge management capability, and
within an organization if it focuses on “broader informa­ BDA-focused hardware and software technology infra­
tion processing, loosening of control, utilization of slack, structure. The development of these capabilities will
and by developing an organizational culture to evaluate enable the organization to comprehend the flow of
potential business risk conditions” (Linnenluecke, 2017, information taking place into the organization, and
p. 12). RiskRes capabilities will therefore allow the orga­ identify trends from the data to aid in business decision
nization to identify competencies within important parts making (Singh & Singh, 2019). An outcome of the devel­
of the firm system, and anticipate important performance opment of such a capability within an organization will
outcomes at several levels of analysis both ex-ante and ex- increase its ability to improve the effectiveness of the
post a disruptive event (Van der Vegt et al., 2015). Such organization’s risk management infrastructure (X.
capabilities are the inherent characteristics of a risk man­ Wang et al., 2017). Although scholars have attempted
agement infrastructure (Quang & Hara, 2018). Over the to identify the impact of organizational BDA capability
last few years, scholars have argued that RMI performs in reducing the negative influence of adverse business
a valuable role within the organization as it assists the firm events (Folke et al., 2010; Redman, 2014); scholarly
6 N. P. SINGH

literature has not adequately addressed the question of PROCESS-based regression analysis to test the hypoth­
how the presence of such a capability can enable com­ esis. In this article the unit of analysis is the firm, and the
panies to develop business risk resilience (Akter et al., feedback from respondents is considered as proxy for
2016). Consequently, BDA capabilities are not only an firm behavior (Gable, 1994; Straub et al., 2004).
important component of RMI, but also are instrumental
in improving the effectiveness of a firm’s risk manage­
Data collection and sample characteristics
ment infrastructure in predicting future business risks.
Therefore, it can be hypothesized that BDA will moder­ Prior to the development of the survey instrument,
ate the impact of a risk management infrastructure on a review of existing theoretical works that fit the scope
an organization’s ability to develop business risk resili­ of the research question was undertaken. As part of this
ence; strengthening the positive relationship between review, survey instruments developed in several aca­
RMI and RiskRes, and resulting in the emergence of an demic works were evaluated to identify whether the
improved risk resilience capability within the organiza­ scale items developed in those studies could be used to
tion. Hence, hypothesis four postulates that: operationalize the constructs identified as part of the
current research. As none of the survey instruments
H4: Big Data Analytics (BDA) capabilities moderate the developed in reviewed scholarly works completely fit
strength of the relationship between risk management the scope of the study, using the guidelines provided
infrastructure (RMI) and risk resilience (RiskRes), by Malhotra and Grover (1998), survey items from sev­
improving the positive relationship between the two. eral studies were re-specified to more aptly represent the
constructs developed in this article. The construct for
ITIC was adapted from Cepeda and Arias-Pérez (2019),
and Saeidi et al. (2019); with four scale items being
Firm size as control variable
developed to measure this construct. This construct
To ensure robustness of the model, firm size as a control assesses existing IT capabilities within an organization,
variable was included in the research model. Firm size was and how effectively these capabilities are used for busi­
measured using the annual financial turnover of the orga­ ness risk identification, business risk treatment, and
nization to which the survey respondents belonged to environmental scanning for business risk events.
(Saeed et al., 2019). The use of firm size as a control The construct for BDA was adapted from Akter et al.
variable is important, as the ability of a firm to develop (2016), Dubey et al., (2019), and Gupta and George
risk resilience capabilities is contingent on the size of the (2016). Twelve scale items were developed to measure
firm (Pleshko et al., 2014). As the survey respondents had the construct of BDA. Using the template adopted by
self-identified the company that they were employed in, previous studies to operationalize the construct of BDA,
data related to the annual revenues of the firm were this article also uses four scale items each to measure
collected through COMPUSTAT. For some smaller three different dimensions of organizational BDA cap­
firms whose financial information was not available on ability (infrastructure, human capital, and knowledge
COMPUSTAT, data related to their annual revenues were management perspectives). The construct for risk man­
collected by directly visiting the website of the organiza­ agement infrastructure (RMI) was adapted from
tion to which the survey respondents belonged to. Saurabh Ambulkar et al. (2015) and operationalized
using three scale items. The items for RMI were con­
ceptualized as resources inherent in an organization that
Research methodology
enhances the firm’s risk resilience capability. These
To answer the research questions identified earlier, the items consider the presence of a department within the
study initially focused on identifying constructs and firm to manage disruption events, plan for and create
developing a research model through a comprehensive capabilities within the firm to manage crisis events, and
literature review exercise. Post the development of use information systems to manage business risk.
a research model, a survey instrument was developed Finally, the construct for RiskRes was operationalized
to test the constructs and check for the veracity of the using four scale items. The items used to measure
hypothesized relationships. The hypothesized relation­ RiskRes were also adapted from Saurabh Ambulkar
ships were tested through an empirical methodology et al. (2015), and determine the ability of the firm to
that includes developing and using a survey instrument cope with business disruption events, maintain business
to collect data, utilizing secondary data as a control continuity in case of such events, and recover quickly
variable, factor analysis employing statistical software from business disruption with the lowest cost. To estab­
(SPSS 26, AMOS 25), and empirical analysis through lish content validity two scholars and two managers well
 INFORMATION SYSTEMS MANAGEMENT 7

versed with big data analytics and firm strategy devel­ construction phase instrument item ambiguity was con­
opment were interviewed, and their feedback was used trolled for by performing expert reviews of the survey
to further improve the survey instrument. instrument. In addition, during the data collection stage
The database of potential survey respondents was devel­ the respondents were guaranteed anonymity and con­
oped using the social media platform of LinkedIn. These fidentiality of their responses. Second, according to
potential survey respondents had self-identified themselves scholars (Hu et al., 2019; Pavlou & Xue, 2007), CMB
on LinkedIn as possessing work experience in business would exist if the construct correlations were observed
domains such as information technology, business strategy, to be higher than 0.90. In the study, the highest correla­
IT strategy, and BDA adoption and implementation within tion coefficient is 0.67 suggesting that CMB is not
an organization. In terms of respondent profile, they were a cause for concern (Table 2). This conclusion is also
employed as either middle or senior manager within their supported by Harman’s single factor test as the analysis
company. From the initial sample base (2000), 1850 profes­ highlights that no single component accounts for the
sionals conditionally agreed to participate in the study. To majority of the variance (Podsakoff et al., 2003; Shen
ensure that the items in the survey instrument correlate et al., 2019).
properly with the constructs, a pretest with 35 respondents Third, a marker variable test for the estimation of
was conducted. The survey was hosted on an online plat­ common method variance to control for CMB was also
form (Qualtrics), and shared with managers identified for conducted (Hu et al., 2019; Malhotra et al., 2006).
the pretest. The results of the pretest suggested acceptable A marker variable was included in the model with
levels of instrument validity and reliability, following which a Common Latent Factor (CLF) connector and the vari­
a full survey research was initiated. The remaining 1815 ables were imputed to create a new common method
executives were contacted and the survey link was shared bias adjusted composites database (Gaskin, 2016). An
with them. After four weeks, 297 completed survey analysis of the results highlights that the common
responses were received, providing a response rate of method variance is evenly shared across the model,
16.05%. The executives involved in the study voluntarily with CMB being considerably less than 2% (0.0144).
agreed to participate in the survey and were not compen­ Based on these results, it can be concluded that CMB
sated in any form. does not impact the outcomes of the research.
The final results were again tested for reliability and Furthermore, as the study adopts a survey methodology
validity. Convergent reliability and validity were assessed there also exists the possibility of response bias.
using factor loadings and Cronbach’s alpha values, respec­ Therefore to ensure that response bias is not a source
tively. Each item again demonstrated acceptable levels of of concern, procedures standardized in earlier studies to
validity and reliability (Appendix Table 1). Once the data control for such a bias were adopted (Armstrong &
collection process was concluded, the survey data were Overton, 1977; Dubey et al., 2019). Such techniques
analyzed and replies with missing data identified. To include comparing the results provided by early respon­
check the distribution of missing responses, Little’s dents and late respondents. A sub-sample of 50 respon­
MCAR test was applied (Little, 1988). The analysis showed dents was therefore selected from the final survey
that values in the database were missing completely at responses and tested for response bias (Choudhary &
random (p > .05). Based on acceptable methodological Sangwan, 2019). The result of the t-test does not demon­
practices (Hair et al., 2010; Li, 2013), responses with missing strate any major difference between early and late
data were removed from the final analysis resulting in 213 respondents, suggesting that response bias is not
usable responses. Table 1 of Appendix presents the profile a source of concern in the study.
of the organizations that the respondents represent.
Test of measurement model
Data analysis and results A measurement model was initially developed to test for
reliability, unidimensionality, and validity. As all the
Determining probable common method bias
items used in the survey were adapted to suit the needs
To ensure robustness of the study a test for common of the research, the methodology identified by Saurabh
method bias (CMB) was undertaken (Podsakoff et al., Ambulkar et al. (2015) for using adapted scales in survey
2003). This test was done by adopting current metho­ research and ensuring scale reliability was followed.
dological practices to control for CMB both prior to the Initially an exploratory factor analysis (EFA) was con­
instrument development phase and during the data col­ ducted using principal component analysis, oblimin
lection stage (Chang et al., 2010; Hu et al., 2019; rotation with kaiser normalization, and extraction cri­
Tourangeau et al., 2000). First, during the item terion of eigenvalue greater than 1.00. Those items
8 N. P. SINGH

Table 1. Profile of firms in database: Industry size, firm size, and duration of operation.
Dimension Category Frequency Percentage (%)
Industry IT Consulting 4 2
Logistics Services 9 4
Service (hotels/restaurants) 9 4
Banking 9 4
IT Software Product 16 8
IT Services 22 11
Healthcare 33 16
Manufacturing 38 17
Others 73 34
Firm Size >1000 18 8
(Number of Employees) 500– 1000 80 39
100– 500 72 33
1– 100 43 20
Duration Company has been in Operations 10 Years or More 213 100

Table 2. Reliability and variance of constructs.

CR AVE Big Data Analytics Risk Resilience Capacity IT Infrastructure Capability Risk Management Infrastructure
Big Data Analytics 0.946 0.598 0.773
Risk Resilience Capacity 0.871 0.628 0.302 0.792
IT Infrastructure Capability 0.916 0.732 0.588 0.411 0.856
Risk Management Infrastructure 0.829 0.624 0.546 0.671 0.538 0.790
CR = Composite Reliability; AVE = Average Variance Extracted

whose factor loadings were observed to be below the

composite reliability (CR), average variance extracted
threshold level of 0.4 were dropped from the scale, and
(AVE), Cronbach’s α (CA), and item loadings to assess
a revised and purified scale with the remaining items was
internal reliability and convergent validity. The standar­
used for confirmatory factor analysis (CFA).
dized CFA loadings in Appendix A provide evidence of
Unidimensionality was reflected through high inter­
convergent validity, as almost all the factor loadings in
nal loadings, high Cronbach’s alpha which exceeds 0.8
the measurement model are greater than 0.7 (Bagozzi &
for all constructs (Nunnally, 1978), and high (>0.8)
Yi, 1988). Although four items do have a factor loadings
composite reliability for each construct (Hair et al.,
below 0.7, scholars suggest that items with factor load­
2010; Segars, 1997). The model was also tested for multi­
ings above 0.6 can be considered if the AVE of the
collinearity using the collinearity statistics option in
construct is higher than 0.5 (Hair et al., 2010). Table 2
SPSS that calculates Variance Inflation Factors (VIF).
highlights that all the constructs meet this criterion, and
VIF values for each construct in the model were calcu­
therefore items below 0.7, but above 0.6 were considered
lated. The range of VIF for all the constructs was
for analysis purpose. Fornell-Lacker criterion was used
observed to be between 1.23 and 2.97, much lower
to check for discriminant validity. According to this
than the acceptable level of 3.33 (Hu et al., 2019). To
criterion the square root of AVE should be greater
further ensure robustness of the model, Durbin Watson
than the correlation with other latent variables for dis­
test for multicollinearity was also conducted. The value
criminant validity to not be a source of concern. Table 2
of the Durbin-Watson test was observed to be 1.863,
shows that the square root of AVE (in bold) is higher
indicating that autocorrelation is not present in the data.
than the correlation between constructs, satisfying this
Both these estimates therefore indicate that multicolli­
condition too.
nearity does not exist within the model.
To further test for model fit, chi-square goodness of
fit (χ2/df) test was used. This value in the model was
observed to be 1.625, showing an excellent fit (Hair et al.,
Test of structural model
2010). Another index used for assessing model fit is Root
Once acceptable levels of reliability and validity of the Mean Square Error of Approximation (RMSEA), in
measurement model were achieved through EFA, the which a value of RMSEA below 0.6 suggests a good fit
structural model was developed and tested using CFA (Byrne, 2016; Kline, 2011). RMSEA in the model was
(Anderson & Gerbing, 1988). Values were calculated for observed to be 0.054 further suggesting a good model fit.
 INFORMATION SYSTEMS MANAGEMENT 9

Comparative fit index (CFI) (Bentler & Bonett, 1980)

A mediation analysis was also conducted to evaluate
was also observed to be 0.961, which is greater than the
the mediating influence of RMI on the relationship
minimum acceptable value of 0.95. Based on these indi­
between ITIC and RiskRes. Based on existing scholarly
cators it can be argued that the structural model exhibits
approaches (Baron & Kenny, 1986), the mediation ana­
good fit and high levels of reliability and validity.
lysis was tested using PROCESS (Model 4, Hayes, 2013)
to identify the relationships (Tables 3 and 4). The results
Hypothesis testing in Table 4 suggest that the indirect effect between ITIC
and RiskRes, with RMI as the mediating variable are
As a precursor to hypothesis testing, we initially tested positive and significant (β = 0.3063, p < .001). The direct
for possible common method bias using AMOS 26, and effect between ITIC and RiskRes in the presence of the
then developed a measurement as well as a structural mediator was observed to be insignificant (β = 0.0159,
model to check the validity and reliability of the con­ p > .05). However, the total effect of ITIC on RiskRes
structs. Once the efficacy and dependability of the con­ without the presence of the mediator (RMI) is signifi­
structs was established, the PROCESS macro developed cant (β = 0.3222, p < .001). These findings indicate that
by Hayes (Hayes, 2013) for SPSS was used to empirically the strength of the relationship between ITIC and
validate the hypothesized relationships. The refined RiskRes is no longer significant, when the mediating
database comprising 213 respondents was used for the variable (RMI) is added to the model, signifying full
purposes of data analysis. The direct effects (H1, H2, mediation (Tables 4 and 5). Based on these results, it
H3), and the mediated effects of RMI were tested using can be argued that the risk management infrastructure
the mediation model (Model 4, Hayes, 2013) in positively mediates the impact of IT infrastructure cap­
PROCESS. The moderation impact of BDA (H4) was ability on risk resilience.
tested using the OLS regression-based approach of con­ To check for the moderating role of BDA capabilities
ditional process analysis (Model 14, PROCESS tool), [Tables 6 and 7]; Hayes’ PROCESS macro was again used to
which examines the conditional effect of the indepen­ conduct a moderation analysis (Model 14, bootstrap =
dent variables for different values of mediating variables 5000, confidence interval = 95%) (Hayes, 2013).
(Hayes, 2013; Yoganathan et al., 2019). An analysis of Hypothesis four (H4) had argued that BDA moderates
the mediation model for direct effects shows that IT the strength of the relationship between RMI and
Infrastructure Capability (ITIC), has an insignificant, RiskRes, strengthening the positive relationship between
direct, and positive effect on organizational risk resili­ the two. To verify H4, an interaction term was created by
ence (RiskRes) [hypothesis 1: β = 0.0159, p > .05]. The mean-centering the two independent variables and com­
results (Table 3) therefore do not uphold hypothesis one puting their cross product (Hair et al., 2010). A significant
(H1). We do however find support for hypothesis 2 cross-product interaction term in the regression provides
(H2), as ITIC does exhibit a significant, direct, and evidence of moderation (β = 0.0820; p < .05; Table 6). The
positive effect on RMI [hypothesis 2: β = 0.6099, change in r square when the moderating variable is
p < .001, Table 3]. The analysis of the results further included in the model is also found to be significant (r2
confirms hypothesis 3 (H3), as a significant, direct, and change = 0.0100; p < .05). We further tested the moderating
positive effect of RMI on firm risk resilience (RiskRes) is relationship at high (1 SD above mean), mean, and low (1
observed [hypothesis 3: β = 0.5023, p < .001, Table 3]. SD below mean) levels of the moderator (Figure 2, Table 7).

Table 3. Model coefficients for the mediation effect of ITIC on RiskRes via RMI.
Antecedents RMI as DV RiskRes as DV
Coefficient Coefficient Std. error p LLCI ULCI
IT Infrastructure Capability (ITIC) 0.6099 - 0.0619 0.0000 0.4879 0.7319
0.0159 0.0446 0.7226 −0.0721 0.1038
Risk Management Infrastructure (RMI) - - - - - -
- 0.5023 0.0411 0.0000 0.4212 0.5834
Revenue −0.0016 - 0.0349 0.9646 −0.0704 0.0673
- 0.0025 0.0208 0.9037 −0.0385 0.0436
Constant 2.0834 - 0.3042 0.0000 1.4837 2.6830
- 1.0044 0.2005 0.0000 0.6091 1.3998
r2 = 0.3248 2
r = 0.5227
F = 50.5048 F = 76.3025
p < .00 p < .00
n = 213 n = 213
10 N. P. SINGH

Table 4. Direct and indirect effects of ITIC on RiskRes via RMI.

Relationship Total Effect Direct effect with mediator Indirect Effect
ITIC ——>RMI ——>RiskRes 0.3222*** 0.0159ns 0.3063***
Note: ***p < 0.001, ns = not significant, n = 213

Table 5. Mediation analysis interpretation.

Effect of Interpretation
ITIC ——>RMI ——>RiskRes Full Mediation

Table 6. Model coefficients for the moderation effect of Big Data Analytics.
Risk Resilience Capacity
Risk Management Infrastructure (RMI) (RiskRes)
Antecedents Coeff. 95% CI Coeff. 95% CI
LLCI ULCI LLCI ULCI
IT Infrastructure Capability (ITIC) 0.6099 0.4879 0.7319 0.0874 −0.0057 0.1804
Risk Management Infrastructure (RMI) - - - 0.5567 0.4719 0.6414
Big Data Analytics (BDA) - - - −0.1766 −0.2808 −0.0723
RMI X BDA - - - 0.0820 0.0072 0.1569
Revenue −0.0016 −0.0704 0.0673 0.0091 −0.0310 0.0493
Constant −1.7805 −2.3801 −1.1809 2.6501 2.2463 3.0538
r2 = 0.3248 2
r = 0.5558
F = 50.5048 F = 51.8024
p < .00 p < .00
n = 213 n = 213

Table 7. Conditional indirect effect of ITIC on RiskRes through RMI at different levels of BDA.
Value of Moderator Effect BootSE Boot LLCI Boot ULCI
− 0.7544 0.4948 0.0511 0.3940 0.5956
0.0000 0.5567 0.0430 0.4719 0.6414
0.7544 0.6185 0.0521 0.5158 0.7213

Figure 2. Interactive effect of RMI and BDA on RiskRes.

The moderating relationship was observed to be significant

at all levels of the moderator. Analysis of Table 6 further is used to show the moderating relationship (low [- 1 SD]
provides support for H4 by highlighting that BDA moder­ vs. high [+1 SD] levels of BDA). With evidence that BDA
ates the impact of RMI on RiskRes resulting in significant moderates the relationship between RMI and RiskRes, the
and positive impact on organizational risk resilience cap­ conditional indirect effect (moderated mediation) at differ­
ability (β = 0.5567; p < .001). Simple slope graph (Figure 2) ent values of the moderator was also examined but no
 INFORMATION SYSTEMS MANAGEMENT 11

evidence of moderated mediation was observed (β = 0.5000; business risks, and development of effective risk mitigation
BootLLCI = −0.0057; BootULCI = 0.1036). strategies. The support observed for H3 further validates
existing works that have called for organizations to focus on
developing capabilities to manage risk (Singh, 2020), rather
Discussion and implications
than treating business risk as a random event that can be
As use of data analytics by firms has increased globally, it disregarded by managers.
has become even more important to understand how BDA
We also tested the argument that RMI positively mediates
capabilities provide value to business organizations. The the impact of ITIC on organizational ability to develop
primary objective of this article was therefore to identify business risk resilience. An analysis of the direct and indir­
how BDA adoption by firms impacts an organization’s ect effects shows that this perspective holds true. This is an
ability to develop business risk resilience. The first set of important finding as the results indicate that RMI fully
hypothesis identifies the impact of IT infrastructure cap­ mediates the impact of ITIC on RiskRes, facilitating the
emergence of risk resilience capability within an organiza­
ability on emergence of a risk management infrastructure
tion. These observations suggest that businesses should
within the firm, as well as its influence on organizational focus on developing an effective IT infrastructure as it is
ability to build business risk resilience. An analysis of the a necessary condition for any organization to develop risk
results goes on to suggest that although ITIC is an ante­ management capability. However the mere presence of an
cedent to both RMI and RiskRes, the process by which it IT infrastructure does not necessarily translate into value
impacts both the constructs is quite different. Although the for the organization. The company also has to focus on
developing capabilities that effectively utilizes the IT infra­
results do support H2, we fail to find any support for H1. structure for business purposes. In the study, such
Therefore, it can be suggested that although an organiza­ a capability is identified as the development of a risk man­
tional strategy of developing IT infrastructure capabilities is agement infrastructure within an organization. In the pre­
valuable, the benefits of such a strategy tend to be indirect sence of such an infrastructure, ITIC enables decision
and obscured. The results suggest that if an organization makers to develop actionable business intelligence, allow­
ing managers to formulate risk management strategies that
focusses on developing an effective IT infrastructure, then
facilitate organizational initiatives to achieve business risk
such an organizational capability enables the firm to effec­ resilience. Therefore it can be argued that a firm’s ability to
tively harness the various competencies within the organi­ manage risk is an outcome of the presence of competitive
zational network. Such an IT infrastructure therefore capabilities within an organization, that can only be har­
positively impacts the risk management infrastructure put nessed through an organizational structure focused on
into place by the organization (H2). The primary reason developing risk resilience.
being that a RMI involves developing both human capital Furthermore, hypothesis four (H4) had argued that BDA
capability to identify potential sources of risk within the moderates the impact of RMI on RiskRes, strengthening
firm and an effective response strategy. IT capability there­ the relationship between the two constructs. This argument
fore improves the decision-making effectiveness within the was strongly supported highlighting that if an organization
builds up BDA capabilities within the firm, then the firm
RMI by providing decision makers with actionable business will be able to improve the effectiveness of its risk manage­
intelligence. ment infrastructure leading to improved business risk resi­
However, we further observe that ITIC does not directly lience ability. The results therefore provide support for H4
impact the organizational ability to develop business risk at all levels of the moderator (Figure 2; Table 7). Figure 2
resilience (H1). As we failed to find any statistical signifi­ further improves our understanding of this relationship by
suggesting that when an organization’s risk management
cance between ITIC and RiskRes, it can be inferred that
infrastructure is weak (low RMI), BDA adoption by the
such an impact is mediated through another variable. The firm does not significantly improve the firm’s ability to
relationship between ITIC and RiskRes however becomes develop risk resilience capabilities. However, when a firm
much more apparent when we evaluate the mediating role possess a well-developed and efficient risk management
of RMI. Hypothesis three (H3) on the other hand asserts infrastructure (High RMI), both low and high intensity of
that the presence of a risk management infrastructure BDA adoption exhibit a significant impact on an organiza­
tion’s ability to develop business risk resilience capability.
within an organization is an important condition for Another interesting observation that comes from an ana­
a firm to develop business risk resilience. The strong posi­ lysis of Figure 2 is that a low degree of BDA adoption has
tive support observed for H3 (Table 3) indicates that orga­ a greater impact on a firm’s ability to develop risk resilience
nizational initiatives to manage risk contribute more capabilities than a higher degree of BDA adoption. These
toward a firm’s ability to develop business risk resilience results therefore provide a counter-intuitive argument sug­
gesting that although investing in BDA to strengthen
capability, than by focusing primarily on development of IT
a firm’s risk resilience capability is an effective business
capabilities. The presence of a RMI therefore facilitates the strategy, low degree of investment in developing BDA
development of a risk management culture within an orga­ capabilities to manage business risk resilience is sufficient
nization leading to timely identification of potential to achieve the desired outcome.
12 N. P. SINGH

These observation provide for two important strategic develops these perspectives by not only identifying the
prescriptions. First, organizations should primarily specific conditions under which BDA capabilities act as
focus on developing a risk management infrastructure a dynamic capability within an organization, but also by
in order to achieve business risk resilience. The modera­ further specifying the level and degree of BDA adoption
tion results corroborate this observation suggesting that that provides maximum value add to risk management
organizational culture focused on managing business risk initiatives adopted by an organization.
enables firms to acquire business risk resilience capabil­
ities. Second, the results provide additional evidence that Second, the study supports scholarly calls for developing
identifies how BDA capabilities significantly impact orga­ a better understanding of the increasing importance of IS
nizational ability to build competitive advantage. The strategy within an organization (Abdolvand & Sepehri,
results (Tables 6 and 7; Figure 2) provide further support 2016). The results suggest that a well thought out and
for this perspective by suggesting that the adoption and effectively implemented IS strategy enables an organiza­
implementation of BDA capabilities within an organiza­ tion to develop capabilities that can assist the firm to
tion demonstrates a strong and positive impact on the achieve sustainable competitive advantage Therefore the
effectiveness of an organization’s risk management infra­ article not only contributes to the IS literature, but also
structure, enabling the firm to develop business risk resi­ develops a theoretical rationale that links together con­
lience capabilities. The degree of BDA adoption from cepts such as ITIC, RMI, BDA and RiskRes. The devel­
a risk resilience perspective is also important as the results opment of our understanding related to how all the
further highlight that even low levels of investment in identified constructs interact with each other, further
BDA capabilities significantly improves the effectiveness enhances our theoretical understanding of how an effec­
of a firm’s risk management infrastructure. It is further tive IS strategy implementation can enable firms to
observed that firm size (control variable) represented by achieve competitive advantage. Third, the study suggests
annual revenues of the firm, was found to be statistically that organizational focus on developing a risk manage­
insignificant. In-spite of this value being insignificant, the ment infrastructure pays high dividends by improving
presence of a control variable in the model is important as a company’s ability to manage business risk events and
it helps to improve the robustness of the model. The fact achieve risk resilience. The results suggest that for an
that firm size has no impact on the model is quite mean­ organization to effectively manage business risk it is
ingful as it suggests that organizations, irrespective of necessary to establish a risk management infrastructure.
size, can develop business risk resilience capacity if they Such an infrastructure serves as a node to assimilate
put into place a risk management infrastructure that is organization wide information flows, develop actionable
supported by BDA capabilities. intelligence, and enables the organization to react proac­
tively to business risks. The results therefore support
scholarly attempts to further enhance our understanding
of how BDA impacts organizations at the micro level
Theoretical contributions (Loebbecke & Picot, 2015).

Fourth, Buhl et al. (2012) had argued that a major issue

The current research offers several theoretical contribu­ with IS research stems from gaining solutions to IS
tions to the Information Systems and BDA literature. problems using studies with small sample sizes. Such
First, an important contribution of the study is the an approach decreases the generalizability of the find­
identification and empirical validation of BDA capabil­ ings, and increases incidence of Type I errors. However,
ities as a source of competitive advantage within a firm. the generalizability of this research is quite high as the
The study describes big data analytics as a competitive survey responses are geographically dispersed, are col­
capability, which if effectively adopted and implemen­ lected from a diverse range of industry sectors, and have
ted, can enable firms to develop competitive advantage respondents with significant functional expertise in IT
in the form of business risk resilience ability. Recent and business strategy domains. Therefore the study
research has focused on identifying tangible ways in provides several theoretical insights, and further
which the construct of dynamic capability can be oper­ improves our understanding of how the adoption of
ationalized, and scholars have attempted to identify BDA capabilities by firms can result in an organization
specific capabilities that could be considered as falling developing sustainable competitive advantage.
within this category (D. Q. Chen et al., 2015). The study
therefore contributes to this research stream (Günther
et al., 2017) by identifying the conditions under which
BDA capabilities can operate as a dynamic capability Practical implications
within an organization. Specifically, the results highlight
that even the presence of low levels of BDA capabilities From a managerial outlook the results are also extremely
can have a significant impact on an organization’s abil­ relevant as the findings provide some interesting insights
ity to develop risk resilience capabilities. Current theo­ into the potential benefits of developing BDA capabilities
retical viewpoints argue that the existence of BDA within an organization. First, an analysis of the survey
capabilities within an organization can help create com­ items that comprise the construct of BDA suggests that
petitive advantage (Wamba et al., 2017), as well as plays BDA capability are all encompassing and include elements
an important role in enabling firms to manage business such as hardware and software technologies specifically
risk (Singh & Singh, 2019). The article therefore further related to developing BDA infrastructure capabilities,
 INFORMATION SYSTEMS MANAGEMENT 13

BDA related knowledge management capabilities, and hypothesis strongly, it does somewhat limit the predict­
BDA focused human capital capabilities. Therefore, firms ability of the model. Fourth, despite the fact that the
should focus on simultaneously developing all three cap­ respondent size is not extremely high (213 respondents),
abilities to create an organization wide BDA analytics
capacity. Second, the study identifies a strong relationship it is still sufficient enough to conduct a robust and mean­
between the presence of a risk management infrastructure ingful statistical analysis (Hair et al., 2010). Another pos­
and the development of business risk resilience capability sible limitation of the study is the profile of the
by a firm. This is an important direction to senior manage­ respondents. The survey database was developed using
ment as organizations historically do not focus on devel­ LinkedIn profile of business professionals who had self-
oping such a capability to manage business risk (Chopra &
identified themselves as managers with significant experi­
Sodhi, 2014). The norm is to delegate such responsibility to
the affected business unit, or to deal with concerns as they ence working with BDA technologies, as well as in IT and
arise. However, the empirical analysis strongly suggests business strategy development. As response bias is
that the presence of a RMI has a significant impact on an a source of concern in all forms of survey-based research,
organization’s capability to manage business disruptions. several steps were therefore adopted during the data col­
Third, the results highlight that even a small investment by lection and analysis stages to prevent such a bias from
a firm in developing BDA capabilities results in significant
improvements in the effectiveness of the organization’s risk skewing the outcome of the results. However, in spite of
management infrastructure. This is an important observa­ all the shortcomings, the study does offer significant
tion as the results provide empirical validation to the gen­ insights, and can be considered as a starting point for
eral perception existing among managers that adoption developing a better understanding of the conditions
and implementation of BDA adds value to an organization. under which BDA capabilities can be used within an
Furthermore, the study also identifies specific conditions,
organization to acquire sustainable competitive advantage.
as well as the degree of BDA adoption that should exist in
firms, before BDA capabilities exhibit a tangible business
impact. Finally, the study highlights the importance of
developing an IS strategy that focusses on the creation of
Conclusion
an IT infrastructure capability. The study therefore pro­ As the role of Big Data Analytics has expanded exponen­
vides empirical support for the argument that organiza­
tially in recent years, we have also witnessed a high failure
tional investment in IT infrastructure capability does
translate into tangible benefits for the organization, rate within firms when it comes to developing business
although those benefits might not be immediately apparent insights using BDA capabilities. This study therefore
to the various stakeholders. serves as a starting point to understand how an effective
information systems strategy focusing on the use of BDA
capability can enable an organization to improve the
effectiveness of its risk management infrastructure and
Limitations
achieve superior business risk resilience capability. The
As with all studies, this research too has certain limita­ understanding of such a relationship is extremely impor­
tions. First, the study is based primarily on organizations tant as firms currently operate in a dynamic business
geographically located in the United States and Europe. environment, and therefore it is important for companies
The study however does not include responses from man­ to develop business capabilities that can evaluate infor­
agers based in different regions of the world where man­ mation from various sources simultaneously and provide
agerial experience related to the impact of BDA on an managers with actionable business intelligence to make
organization’s ability to develop business risk resilience informed decisions. The study therefore provides addi­
might be extremely different. This might especially be tional insights into how BDA capabilities add value to an
true for companies operating in developing parts of the organization, as well as identifies several research
world where macro- and micro-business risk events are streams, which if investigated further can provide addi­
common, and managers must be acutely aware of poten­ tional insights both from a theoretical and practitioner
tial risk events and their impact on business disruption. perspective. Future studies can build on the current
Second, the study is extremely broad in terms of industry research to identify how BDA capabilities impact busi­
segments being covered. Although such a broad-based ness risk resilience in different industry sectors. In addi­
analysis does offer higher levels of generalizability related tion, given the significant increase in adoption of BDA
to the findings, it does decrease our ability to offer indus­ technologies by firms located in developing regions of the
try-specific learnings on how BDA can be used to develop world, another possible avenue of research could be to
risk resilience. Third, from a methods perspective another identify how companies operating in Asia, Africa, and
possible limitation of the study is the r2 value of 0.5558. Latin America utilize BDA capabilities for purposes of
Although given the scope and methodology used in the risk identification, risk response, and risk mitigation.
study, the r2 value is high enough to support our Furthermore, given that the impact of BDA adoption
14 N. P. SINGH

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APPENDIX A

Table 1. Item description, Cronbach’s Alpha, and standardized item loadings.

Variables Item Descriptions (Scale) Mean S.D. Loadings
IT Infrastructure Capability (ITFS) (α = 0.913)
ITFS1 Our firm uses IT based systems in identifying potential threats to our business from internal and external environments 3.55 1.167 0.758
ITFS2 Our firm uses IT based systems to identify and assess risk 3.58 1.103 0.869
ITFS3 Our firm uses IT based systems for Risk treatment (Developing a range of options for mitigating the risk, assessing 3.45 1.096 0.857
those options, and then preparing and implementing action plans)
ITFS4 Our firm uses IT based systems for continual monitoring and review of risks and their treatment 3.52 1.084 0.929
Big Data Analytics (BDA) (α = 0.946)
BDA1 Our firm invests in and maintains cloud-based platform (eg. AWS) to analyze big data 2.94 1.323 0.614
BDA2 Our firm invests in big data analytics software (eg. SAS Enterprise Miner, Tableau) 3.09 1.343 0.649
BDA3 Our firm currently utilizes some form of distributed file systems (eg. Hadoop Distributed) 3.07 1.248 0.648
BDA4 Our firm encourages employees to leverage their big data analytics skills to solve problems 3.21 1.199 0.831
BDA5 Our firm has managerial resources to take relevant actions on insights derived from big data analytics 3.13 1.169 0.802
BDA6 Our firm incentivizes employees to get certified in big data analytics technologies 2.40 1.049 0.792
BDA7 Our firm’s top management encourages employee to come up with innovative big data initiatives 2.94 1.154 0.865
BDA8 Our firm focuses on forging strategic contacts with analytics knowledge leaders in the field 2.90 1.167 0.823
BDA9 Our firm invests in documenting processes and procedures for big data analytics 2.81 1.108 0.886
BDA10 Our firm invests in knowledge management systems 3.30 1.091 0.722
BDA11 Our firm participates in big data analytics conferences 2.69 1.152 0.749
BDA12 Our firm encourages employees to invest in analytics knowledge networks (eg. Posting on questions in analytics web 2.70 1.051 0.841
queries)
Risk Management Infrastructure (RMI) (α = 0.803)
RMI1 We have readiness training for overcoming crisis 3.37 1.124 0.859
RMI2 We have resources to get ready during crisis 3.62 .982 0.871
RMI3 We have strong security system to protect our business from man- 3.89 .881 0.611
made crisis
Risk Resilience Capability (RiskRes) (α = 0.870)
RiskRes1 We are able to adapt to the business process disruption easily 3.44 .892 0.783
RiskRes2 We are able to maintain business continuity even after a business 3.74 .815 0.750
process disruption event
RiskRes3 We get recovery in short time 3.55 .837 0.842
RiskRes4 We can recover from crisis at less cost 3.38 .869 0.792