The significance of agility is widely accepted because agile organizations are more successful in changing and competitive environments. Although the relationship of information technology (IT) capability and knowledge capability with organizational agility has been documented, limited information is available on the extent to which these two capabilities affect organizational agility. Attempts to understand the effect of IT and knowledge capability on organizational agility in the presence of contextual factors have also been few. Based on data collected from 123 organizations in China, we examine the moderating effects of two contextual factors (environmental uncertainty and information intensity) on the relationship of IT and knowledge capability with organizational agility. We contribute to current knowledge by showing that environmental uncertainty positively moderates the effects of IT capability and knowledge capability on organizational agility and that information intensity positively moderates the effects of knowledge capability on organizational agility. IT capability and knowledge capability are more effective in the presence of high environmental uncertainty and information intensity. While we find that both IT and knowledge capabilities have positive effects on organizational agility, knowledge capability is more effective than IT capability.
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