The Effect of External Environment Characteristics on Effective IT Governance through Organizational Performance

During the last decade, information technology (IT) has been playing more important role for organizations in achieving their goals. Recently, information technology governance has become a critical issue for many companies in various industries. The aim of this study is to examine the extent to which influence of external environment characteristics affects the effectiveness of IT governance as well as the performance of organizations in Malaysian manufacturing companies. Moreover, the mediating influence of effective IT governance was also being tested. 357 questionnaires were used in order to conduct the analyses. Structural Equation Modeling (SEM) is used for testing the developed hypotheses generating from the theoretical framework of the study. The data obtained from managers in manufacturing industry; Samples selected from seven states of Malaysia (Selangor, Penang, Johor, Sarawak and Negeri Sembilan, Melaka, Pahang).This topic of research has considerable significance in Malaysia; A significant contribution of this study is the construction of a theoretically based model which assimilates the external environment characteristics, effective information technology governance, and organizational performance.