Advancing Sustainable Digital Transformations Through HRIS Effectiveness: Examining the Role of Information Quality, Executives’ Innovativeness, and Staff IT Capabilities via IS Ambidexterity

Abstract

In the face of accelerating digital transformation and AI-driven innovations in the post-COVID-19 era, the effectiveness of Human Resource Information Systems (HRIS) is critical to organizational resilience and sustainable digital transformation in highly regulated sectors. This study examines how information quality, executive innovativeness, and staff IT capabilities influence HRIS effectiveness and evaluates the mediating role of Information System (IS) Ambidexterity, defined as an organization’s ability to explore and exploit its IS resources concurrently. By confirming the impact of organizational enablers on HRIS effectiveness, the study provides theoretical grounding for digital transformation strategies rooted in Resource-Based View (RBV) and Dynamic Capabilities Theory (DCT). Partial Least Squares Structural Equation Modeling (PLS-SEM) using SmartPLS was employed for its strength in modeling complex relationships and validating latent constructs in organizational contexts. Empirical data were gathered from 157 HR leaders across financial institutions in Pakistan. The results confirm that the identified enablers significantly impact both IS Ambidexterity and HRIS effectiveness and also emerge as strategic levers for building resilient, data-driven HRIS frameworks. IS Ambidexterity, a relatively underexplored construct in information systems research, enhances the strategic contribution of HRIS by serving as a dynamic capability that enables organizations to adapt and create sustained value in evolving digital environments. HRIS effectiveness contributes to efficiency, agility, strategic responsiveness, and cost optimization in financial institutions. The findings contribute to theory by integrating IS enablers with dynamic capability mediation, enriching the RBV-DCT interplay. This study provides evidence-based insights for developing economies pursuing sustainable digital transformations.

1. Introduction

The COVID-19 pandemic reshaped business priorities, placing human resource management at the center of strategic focus, with Human Resource Information Systems (HRIS) rising as its indispensable technological ally for sustainable digital transformations [1]. Reliance on human resource data and its quality has grown considerably in the aftermath of the COVID-19 pandemic, particularly for managing geographically dispersed, digital-first workforces [2]. Building on the increased reliance on HR data, in Pakistan, a post-webinar poll by the Institute of Chartered Accountants of Pakistan (ICAP) revealed that 55.6 percent of participants identified digitizing all customer interactions, and 36.4 percent highlighted upgrading existing technologies as top post-COVID-19 priorities [3]. These insights reflect the financial sector’s growing focus on technology-driven sustainable transformation, deeply grounded in the quality of information and reinforcing the relevance of HRIS as a strategic tool in managing human resources. Relating to the fact that AI and digital technologies increasingly depend on the information fed to them, observing the role of information quality in relation to IS effectiveness in the information-sensitive sector of the financial industry of Pakistan provides an important and contemporary landscape to be explored. However, despite growing adoption, the true value of HRIS investments remains contested, as scholars and practitioners alike continue to seek assurance that these systems translate into tangible, lasting, and sustainable impact, especially in the financial sector, where large-scale investments are yet to yield consistent, measurable returns [4].

Pakistan’s financial industry comprises banks and non-banking financial institutions (NBFIs) as of 2022, regulated by the State Bank of Pakistan (SBP) and the Securities and Exchange Commission of Pakistan (SECP) [5,6]. In Pakistan, although banking dominates in Gross Domestic Product (GDP) contribution [6], the broader financial sector is instrumental for achieving national sustainable development goals (SDGs). Henceforth, this study concentrates on the financial sector of Pakistan due to its early adoption of technology, regulatory complexity, and significant economic footprint.

Ref. [7] examined Pakistan’s banking sector, a key segment of the broader financial industry, and offered preliminary insights into HRIS potential in modernizing HR functions. Their findings revealed that HRIS contributed to only 30 percent of resolving employee turnover and absenteeism, revealing significant underutilization within HR planning in Pakistani banks [7]. Similarly, comparative research across Pakistani sectors highlights the underutilization of HR technologies leading to poor information dissemination. As such, in healthcare, refs. [8,9] found persistence in continued reliance on manual processes despite the availability of health information systems. Ref. [10] reported similar underperformance in public sector enterprises, where HRIS is often used as a formality. In contrast, refs. [11,12] highlighted positive outcomes in higher education, where technology-enabled HR practices improved performance during the COVID-19 pandemic. As financial institutions are major technology investors, early adopters, and tightly regulated, examining HRIS effectiveness in this sector is both timely and necessary [13]. Similarly, in such tightly regulated sectors as finance, robust information systems, including HRIS, underpin the strategic use of technologies, not limited to even AI, to ensure not only efficiency but also the resilience, economies of scale, and sustainability of digital ecosystems [14].

In addition, the high failure rate of expensive digital transformations remains a concern, with nearly 70 percent of IT projects failing in the long run [4]. Relating to it, earlier studies suggest that about 50 percent of technology implementations fall short, calling for deeper investigation into the causes [15].

The banking sector’s track record in adopting and transforming through technology has remained mixed [7,16], reinforcing the need for more focused efforts for improvement of information assets to remain competitive in the future. This highlights the relevance of continued inquiry in this area. In a keynote address at the 13th IFSB Public Lecture Series, the Governor of the State Bank of Pakistan stressed the urgency of effective digitalization and the establishment of sound cybersecurity frameworks to preserve information quality and governance, and maintain stakeholder trust [17]. In a similar context, the Securities and Exchange Commission of Pakistan’s (SECP) Chairman, speaking at the 2022 All Pakistan Chartered Accountants Conference, cited low innovation, rigid hierarchical structures, and poor strategic use of technology as major challenges to achieving resilience and sustainability in the financial sector (SECP, 2024). His remarks underscore the critical need for modernization to build resilience and sustainability across financial institutions. Despite such institutional awareness, there remains a clear research gap in understanding how technology and innovation can be better applied to boost information systems in supporting sustainable growth in Pakistan’s financial sector, warranting deeper investigation into the subject.

The COVID-19 pandemic aftermath [1] and rapid development in artificial intelligence (AI) have also transformed HRIS, making it a contemporary research topic, highlighting the gap that there is a lack of consistent research on HRM in the context of modern technologies [18]. Organizations now, for strategic decision-making, increasingly rely on HR data [2,19]. Regardless, in Pakistan’s financial sector, stakeholders continue to express concerns over poor digital implementation, creating barriers to sustainable development, as also noted by senior officials at the State Bank of Pakistan [20,21]. These concerns extend to HRIS, where multiple studies confirm recurring issues that its benefits often fall short of expectations due to underutilization, poor data quality, and performance issues [22,23,24,25,26].

While HRIS adoption has been examined in various contexts [25,27], few empirical investigations have examined its effectiveness holistically, capturing operational, relational, and transformational dimensions simultaneously [28,29,30,31,32,33,34,35]. Furthermore, scholars emphasize the need for future research due to the limited empirical evidence on HRIS effectiveness, especially in developing economies’ contexts [18,24,35,36,37,38]. In addition, another literature gap is observed by scholars: in studying HRIS effectiveness empirically, studies are less [18,39].

Accordingly, this study emphasizes information quality, IT capabilities of staff, and innovativeness of senior executives, which have been recommended in past research as important determinants when information systems, particularly HRIS, are to be studied [40,41,42,43,44,45,46,47]. These variables have also shown mixed outcomes across previous studies, encouraging further inquiry in underdeveloped country contexts like Pakistan [18,48,49,50,51,52,53,54].

Information quality stands out as a foundational element of information systems [55], yet it is frequently neglected in post-implementation HRIS research, especially within financial institutions in developing economies [18,19,55,56]. The inconclusive evidence regarding its influence on IS usage in such contexts highlights a critical research gap [57,58]. Similarly, the IT capabilities of staff, which are essential for HRIS and information systems assimilation, integration, and analytical use, are rarely investigated empirically, despite their acknowledged role in enabling sustainable digital transformations, particularly in technology-intensive sectors like finance [29,46,53,58,59]. Furthermore, the innovativeness of senior executives plays a pivotal role in HRIS success during post-implementation, where lack of technological awareness can lead to weak institutional backing and poor resource allocation [41,43]. Although linked to adoption outcomes in prior studies [45,46], its sustained impact on HRIS effectiveness remains underexplored in highly regulated sectors like finance [42], prompting the need to examine indirect influences through mediators such as IS Ambidexterity [53,60,61].

Organizations must concurrently explore emerging technologies while optimizing existing ones. This duality, in the context of resilient and sustainable information systems, is reflected in the concept of Information System (IS) Ambidexterity, which refers to an organization’s ability to simultaneously explore and exploit IS resources [53,58,59]. Despite its growing relevance, IS Ambidexterity remains underexplored in developing economies [57,62], creating a contemporary gap for investigation in Pakistani context. Also, IS ambidexterity is observed to be a dynamic capability with a significant mediating role in IS research [53], which further motivates this study to examine IS Ambidexterity as a mediating construct linking key determinants to HRIS effectiveness at the post-implementation level [59].

Over the past decades, HRIS-related research has been largely concentrated in developed countries, leaving significant gaps in understanding system performances within developing countries’ contexts [18,39,63,64]. Similarly, HRIS remains underutilized in many developing countries [26], and empirical research from Pakistan remains scarce regarding HRIS [7], as was also identified by several scholars [65]. Additionally, most existing studies are theoretical in nature, pointing to the need for empirical validation of HRIS effectiveness [30,66,67].

This study focuses on the post-implementation stage to observe HRIS effectiveness as a pathway toward sustainable digital transformation, grounded in the rationale that Pakistan’s financial sector is technologically advanced, being an early adopter with substantial investments in digital systems [3,13], yet also faces persistent stakeholder concerns over the return on IT investments like HRIS [68]. This study draws on the Resource-Based View [69,70,71] and Dynamic Capabilities Theory [72] to position information quality, executive innovativeness, and staff IT capabilities as strategic enablers for sustainable growth through the mediating role of IS Ambidexterity. As modern technologies like AI are fundamentally rooted in the quality of information [18,56], this focus becomes essential for realizing the full value of HRIS and broader IS initiatives. Furthermore, the call to investigate disruptive technologies across the entire financial sector, identified as a research gap [73] and recommended to be studied for future research, has been addressed by the current study, adding to its novelty.

Grounded in the identified research gaps, this study aims to examine the contributing factors, including information quality, IT capabilities of staff, and innovativeness of senior executives, in influencing the successful use of HRIS and its overall effectiveness. It further investigates the mediating role of IS Ambidexterity in linking these enablers to HRIS effectiveness at the post-implementation stage, with implications for shaping sustainable digital performance at the organizational level.

1.1. Literature Review

1.1.1. Information Quality

Information quality (IQ) refers to the degree to which the output produced by an information system meets desirable standards. It includes attributes such as relevance, clarity, accuracy, conciseness, completeness, comprehensibility, currency, timeliness, and overall usefulness [74].

IS is intended to produce correct and meaningful data, particularly when the focus is digital sustainability. Similarly, the corresponding concept of information quality is observed to have a significant impact on HRIS adoption amongst the employees of HR departments in various small and medium organizations in India [75]. Attributes of correctness, precision, currency, promptness, adequacy, understandability, and conciseness are all included in the concept of information quality, and comprehensively, these metrics show how well information systems help users make business decisions, focusing on the notion of information quality [76]. Furthering the concept, information quality is largely understood to be the beneficial characteristics of an IS’s productivity and contains interventions that reflect on the system’s information superiority and its utility to the end user [50].

Similarly, ref. [57] has studied the information system success in the context of manufacturing SMEs in Iran and Malaysia and found that information quality is an important antecedent and technological characteristic of IS effectiveness, having a significant relation with “user satisfaction” with IS, however, information quality was observed to be not significantly related to “information system use”, showing the mixed support for the construct.

Ref. [77] confirmed information quality significance in electronic green supply chain management (e-GSCM) integration, yet focused on large firms in developed settings. Ref. [78] showed a link to performance but used convenience sampling in Malaysian firms, making a methodological gap for the current study. Ref. [79] emphasized IQ’s role in ESG alignment through secondary data. Compared to these, this study applies an organizational-level analysis with probability sampling in a regulated, developing market context of Pakistan’s financial sector, where the strategic relevance of IQ in post-implementation HRIS performance remains underexplored.

In the prevailing importance of digital sustainability enabled by AI and modern technologies, which are very much dependent on the information fed to them, observing the role of information quality in relation to HRIS effectiveness, potentially contributing to overall information sustainability, in the information-sensitive sector of the financial industry of Pakistan provides an important landscape to be explored.

1.1.2. Innovativeness of Senior Executives

It encompasses the concept of innovative attitudes among senior management, as organizational leadership plays a vital role in shaping the resilience, adoption, and effective use of information systems [46]. IS professionals must work closely with executives, customers, and suppliers to understand business strategies and contribute to innovation. Furthermore, ref. [80] argues that without recognizing the role of IT in product and process development, senior leaders are unlikely to invest in IT-based innovations. Many such innovations have resulted from close collaboration and knowledge sharing between IS teams and top management [80].

Ref. [14] found that leadership innovation plays a decisive role in achieving the sustainability goals during digital transformation, aligning with the argument that innovative leaders foster adaptive capabilities critical to systems like HRIS. Similarly, ref. [81] observed a significant influence of executive innovativeness on cloud-based accounting adoption in Sri Lanka, though the use of snowball sampling limits its robustness. In contrast, ref. [82] reported no significant association, further highlighting the need for context-specific investigation. The current study contributes by offering empirical insights from a regulated, high-investment sector using probability sampling at the organizational level.

Innovativeness of senior executives has been identified as an important factor in determining the adoption of HRIS in hospitals in Bangladesh [43]. Similarly, refs. [45,46] have also included innovativeness of senior executives amongst the factors that correspond to success factors predicting the efficacy of HRIS implementation; however, their studies focused on ranking the antecedents and did not incorporate the cause and effect relation between innovativeness of senior executives and HRIS effectiveness; the gap that the current study aims to address in the financial sector of a developing country.

1.1.3. IT Capabilities of Staff

IT capabilities of staff refer to the knowledge, skill, and technical competence of personnel who directly contribute to the successful operation, integration, and optimization of information systems [46]. These individuals serve as the foundation upon which technology-driven processes function effectively, ensuring that systems are not only maintained but are sustainable, resilient, and strategically aligned with organizational goals. Their ability to adapt, troubleshoot, and innovate plays a crucial role in unlocking the full potential of information systems within dynamic business environments.

It has been argued by [83] that organizations can postpone the adoption of technologies until their employees acquire the necessary skill set for the said innovations. They further assert that those organizations that have a better workforce with relevant expertise in the technology are more likely to experience the successful implementation of these technologies, supporting the argument that staffs’ IT capabilities are an important factor contributing to the effectiveness of IS at the post-implementation stage [83].

Ref. [84] confirms that strong personnel-level IT skills significantly enhance organizational agility and digital transformation success, supporting this factor within the lens of Dynamic Capabilities Theory. However, in the present study, we approach staff IT capabilities from a Resource-Based View, focusing on their strategic potential in the financial sector.

Despite the acknowledged importance, the influence of staff expertise on the success of IT implementation remains underexplored, leaving room for further investigation across various contexts [85]. Similarly, different scholars have also suggested that the IT capabilities of staff may be further researched in various contexts [45,46].

1.1.4. Information System Ambidexterity

IS ambidexterity is defined as the extent to which organizations can engage in both exploitative and exploratory information system activities simultaneously [53]. The concept originated from the scholarly work of [72], who first presented the term “organizational ambidexterity”, which was furthered by the research work of [56], who observed that long-term sustainability requires a balance between encouraging innovativeness and ensuring optimal implementations. Referring to the field of information systems, ref. [53] described IS ambidexterity as an attained capability, enabling IT departments to concurrently manage existing system potentialities while exploring new technological avenues. Adding to the importance of the concept, it has been observed that ambidexterity is one of the most up-to-date management concepts in agile working environments [86]. Despite the fact that it has been widely debated in management-related literary works for more than two decades, it has not been extensively investigated, and it remains an intriguing subject for future study [86].

Although prior studies have emphasized the significance of IS ambidexterity, ref. [62] points out that much of the existing research has narrowly focused on ambidexterity within business process management, leaving other dimensions of the concept, like information systems and technology, relatively untouched [62]. Also, they observed a growing interest of researchers in this area over the past three years, suggesting a shift towards more exploration of this less researched concept [62]. In addition, referring to geographical considerations, most of the research contributions have come from researchers based in the US, Europe, Australia, and China, while regions like South Asia and other parts of the world have produced less knowledge on the concept of ambidexterity. The importance of this concept in relation to sustainability and resilience, in addition to the call for generating empirical knowledge in the developing economies, gives a compelling argument to research it further.

1.1.5. HRIS Effectiveness

HRIS effectiveness has been measured according to three dimensions: transformational or strategic effectiveness, operational or administrative effectiveness, and relational effectiveness. Operational effectiveness refers to the internal gains in HR productivity achieved by minimizing administrative workload and reducing costs. Relational effectiveness reflects the system’s ability to deliver timely and improved services to both HR and other organizational stakeholders. Transformational effectiveness captures the strategic contribution of HRIS by enabling HR to play a more proactive and decision-oriented role within the organization [87]. Although widely implemented, HRIS is often approached as a singular construct, overlooking its multidimensional nature. Refs. [31,87] stress the importance of evaluating operational, relational, and transformational outcomes collectively, a gap this study addresses. Ref. [88] highlights that digital systems in the public sector underperform largely due to weak post-implementation support, underscoring the need to assess HRIS effectiveness beyond deployment. Additionally, ref. [89] links IS performance with ESG alignment and sustainable HR practices, lending weight to this study’s focus on HRIS as a driver of sustainable digital transformation in regulated financial institutions.

The importance of HRIS is evident from observations by [74], who noted that many organizations allocate nearly one-third of their capital expenditures to information systems such as HRIS. This level of investment places a responsibility on top management, senior executives, and decision makers to ensure that such resources are directed effectively, enabling organizations to maximize human potential while supporting strategic goals. HRIS, like other complex organizational systems, extends beyond software and hardware. It also comprises individuals, policies, procedures, and information that may be deemed essential in the management of the human resource function, forming the system areas that may be considered as non-technical [90].

At the same time, investments in technology remain high-risk decisions, with costly implementations and long-term maintenance agreements requiring careful judgment from organizational leaders [4]. The high cost of deployment and complexity of execution continue to challenge HRIS success [63]. Moreover, while HRIS systems are in place across many firms, they are often underutilized. HR professionals tend to use them as routine tools rather than as platforms for transformation [91]. Though benefits of HRIS have been acknowledged in the public sector in Pakistan, there is a lack of comprehensive research within the corporate sector [92]. This study aims to contribute to this gap by offering deeper insights into HRIS effectiveness in the corporate financial sector of Pakistan. Here, HRIS is considered a specialized system that manages HRM activities across the organization and provides timely, relevant information to support strategic and operational decision-making.

1.1.6. Theoretical Framework of the Study and Theoretical Underpinning

This research is primarily anchored in the Resource-Based View (RBV) theory, with the Dynamic Capabilities Theory (DCT) serving as a complementary theory. Scholars have observed that RBV can be meaningfully applied to information systems research, like the concepts of up-to-date information, staff skills, and the ability of the senior officials to show innovativeness, which stand out as useful resources for the organizations [93]. The concept of dynamic capabilities [94] is pertinent to the exploitation and exploration concepts of IS ambidexterity that create an effective and efficient HRIS leading to viable gains for the organization, since these capabilities are dynamic in nature, as identified by past scholars [53,95]. As scholars demand more empirical research on the notion of dynamic capabilities [94], HRIS provides a suitable platform for furthering the research [95].

By integrating the Resource-Based View and Dynamic Capabilities Theory, this study conceptualizes information quality, executive innovativeness, IT capabilities of staff, and IS ambidexterity as strategic enablers of information system effectiveness in the post-implementation environments. However, possessing these resources alone does not guarantee performance, whereby DCT extends this perspective by emphasizing the firm’s capacity to reconfigure, integrate, and renew these assets in dynamic environments. Here, IS Ambidexterity serves as a dynamic capability that mediates the relationship between resource-based enablers and HRIS effectiveness, allowing organizations to simultaneously explore new digital avenues and exploit existing systems. This integrative RBV-DCT framework nexus not only reinforces the theoretical rigor of the study but also reflects how organizations navigate volatile technological and regulatory landscapes, particularly within Pakistan’s evolving financial sector. This study puts forward the following conceptual framework based on the existing literature and previous research. (See Figure 1).

1.1.7. Hypothesis Development

Information Quality and HRIS Effectiveness

In today’s competitive environment, the significance of information quality is widely acknowledged across industries and regions [96]. It plays a crucial role in shaping user confidence in the reliability and value of the information generated by information systems [55]. In the healthcare sector, information quality has been identified as a key determinant of information system success [97]. Similarly, ref. [46] highlighted its critical role in determining HRIS effectiveness. Also, ref. [56] reported a strong and positive relationship between information quality and IS success in small and medium enterprises in Iran and Malaysia. As a core informational asset under the RBV, information quality strengthens HRIS effectiveness by enhancing the reliability and strategic value of data in decision-making. Based on these insights, the following hypothesis is proposed:

H1: 

Information Quality has a significant positive relation with HRIS effectiveness.

Innovativeness of Senior Executives and HRIS Effectiveness

The creative thinking ability of senior management has long been considered a critical factor in evaluating the effectiveness of information systems [98]. Accordingly, it has been observed that there exists a positive and significant relation between senior executive innovation and adoption of IT [99]. Also, it has been noticed that the attitude of HR managers has a significant positive influence on E-HRM adoption in the context of Bangladesh [100]. Executive innovativeness, viewed as an intangible strategic resource (RBV), fosters a culture of ambidextrous approach and sustainable transformations, thereby advancing HRIS effectiveness. Respectively, the following hypothesis is proposed based on the evidence presented in the above-mentioned literature:

H2: 

Innovativeness of senior management has a significant positive relation with HRIS effectiveness.

IT Capabilities of Staff and HRIS Effectiveness

Staff IT skills are observed to be one of the critical IS capabilities [98]. IT expertise of staff has been found to be significantly and positively associated with e-HRM practices in the context of Bangladesh [100]. Also, the IT capabilities of staff have been observed to have a significant and positive relation with HRIS in the healthcare industry [43]. The IT capabilities of staff serve as valuable human capital resources underpinned by RBV that empower organizations to fully utilize HRIS functionalities and align them with evolving operational needs. Therefore, based on previous research and available literature, the following hypothesis is presented:

H3: 

IT capabilities of staff have a significant positive relation with HRIS effectiveness.

IS Ambidexterity and HRIS Effectiveness

IS ambidexterity is an important dimension of the broader ambidexterity concept, referring to the ability of information systems departments to simultaneously pursue both exploitative and explorative activities [53]. Ref. [85] identified ambidexterity as a key determining factor of innovation. Ref. [53] also found that IS ambidexterity is significantly associated with IS alignment in terms of support for ongoing operations. Similarly, ref. [101,102] reported a positive and significant relationship between ambidexterity and organizational agility. In the context of British high-tech firms, ref. [103] observed that the IT ambidexterity capability relation with IT success is found to be positive and significant. IS ambidexterity reflects a dynamic capability under the theoretical lens of DCT that allows organizations to balance system exploitation and exploration, driving HRIS adaptability and long-term effectiveness. Based on this body of research, the following hypothesis is proposed:

H4: 

IS ambidexterity has a significant positive relationship with HRIS effectiveness.

Information Quality, Innovativeness of Executives, Staff IT Capabilities, and IS Ambidexterity

Technology learning, according to [104], is a foundational antecedent of ambidexterity, which is characterized as the ability to make educated decisions and practice behaviors based on the quality of information. Similarly, more research is proposed to understand the leadership characteristics, which are considered a fundamental antecedent of ambidexterity [105]. In addition, creativity has been identified as a determining factor of ambidexterity, with a positive and significant relation with ambidexterity [106]. Further, a gap has been identified in the research on the basis of scarcity of studies in relation to senior management characteristics and ambidexterity [107]. In addition, human resource competence, which exhibits the capacity and skills of internal human resources, has been identified as a fundamental antecedent of ambidexterity [104]. High-quality information, executive innovativeness, and staff IT capabilities represent valuable organizational resources (RBV) that collectively enable IS ambidexterity, a dynamic capability (DCT), that facilitates both the exploitation of existing systems and exploration of new digital opportunities for sustained digital transformations.

In light of the above, the following hypotheses are proposed:

H5: 

Information Quality has a significant positive relation with IS Ambidexterity.

H6: 

Innovativeness of senior management has a significant positive relation with IS Ambidexterity.

H7: 

IT capabilities of staff have a significant positive relation with IS Ambidexterity.

Mediating Role of IS Ambidexterity

Information System (IS) Ambidexterity, an organization’s ability to simultaneously explore and exploit IS resources, has gained recognition as a key dynamic capability in digital transformation in recent literature [53,58]. While it has been linked to agility and resilience, its role as a mediator remains underexamined, particularly in regulated sectors. Refs. [108,109,110], while studying ambidexterity as a mediator, confirm positive links with IT success and new product development in UK-based SMEs, but their focus remains on individual-level data from developed markets. Ref. [111] further emphasizes its mediating role between AI capability and agility in manufacturing contexts. However, studies such as [107,112] note a geographical concentration in Western and East Asian literature regarding ambidexterity literature. This study contributes novel insights by evaluating IS Ambidexterity’s mediating effect in Pakistan’s financial sector, a high-investment, information-intensive context where such evidence remains sparse.

Ref. [53] has observed that IS ambidexterity mediates the relation between IS assets and operational support, which refers to the organizations’ operational effectiveness of the implemented information systems. Similarly, the relation between various influencing factors and operational support is mediated by IS ambidexterity [53], however, it has also been observed that the mediating role of IS ambidexterity in the context of strategic decision support, which is contextualized as the ability to acquire strategic decisions with the help of effectively implemented information systems, was not significant, leading to the gap for more research in the mediating role of IS ambidexterity due to varied results [113]. As observed by [53], different IS assets influence the IS effectiveness through the mediating role of IS ambidexterity. It is observed that, according to the RBV perspective of the firms, different factors contribute as organizations’ assets [114]. Therefore, the current study proposes that IS ambidexterity mediates the association between the IS assets of information quality, executives’ innovativeness, and Staff IT capabilities that serve as determining factors of IS effectiveness and IS ambidexterity and information system effectiveness.

Henceforth, based on the evidence from prior literature, the following hypotheses (H8–H10) relating to the mediating role of IS Ambidexterity are posited:

H8: 

IS ambidexterity positively mediates the relationship between information quality and HRIS effectiveness.

H9: 

IS ambidexterity positively mediates the relationship between innovativeness of senior executives and HRIS effectiveness.

H10: 

IS ambidexterity positively mediates the relationship between IT capabilities of staff and HRIS effectiveness.

2. Methodology

The master plan prepared by the researcher in the course of their research project is referred to as research design [115]. As such, the present study follows a quantitative approach, and the methodology section for the current study is presented below.

The population for this study considers the entire financial sector of Pakistan. Based on the contexts, scholars advocate single-sector studies to reduce variability arising from differing industry environments, allowing for more consistent and reliable responses; this study aligns with that view, as also recommended by [116,117], by focusing on Pakistan’s financial sector. This is one of the fastest-growing sectors of the economy with a large workforce base. One of the reasons is its substantial GDP contribution to the Economy of Pakistan, which makes the financial sector an important subject of investigation for the current study. From a population of 395 organizations, 367 are located in the 5 capital cities of Pakistan, including Lahore, Karachi, Peshawar, Quetta, and Islamabad, which accounts for a total of 93 percent of organizations in the financial sector. Therefore, the target population for the current study is the 367 organizations working in the financial industry of Pakistan, under the regulatory authority of SBP and SECP, and in the five capital cities of the country. The list of organizations has been obtained from the official websites of the regulatory authorities. In addition, provided the current study’s focus on complex, latent constructs, particularly the mediating role of IS ambidexterity in addition to the second-order dimensions of HRIS effectiveness and IS Ambidexterity, PLS-SEM was selected to capture variance-driven insights in the small sample conditions of the financial sector of Pakistan.

2.1. Sample and Data Collection

Ref. [90] has outlined certain parameters when deciding on a sampling technique, and based on these, the sampling technique for the current study is derived as a proportionate stratified random sampling technique. The unit of analysis for the current study is the organization. The main sampling technique for this study is probability sampling. Further, proportionate stratified systematic random sampling is used to derive the sample responses [118,119,120].

Based on the comparison of various sample size calculation methods, the [121] method, being simple and straightforward, is adopted for calculating the sample size for the current study, which turns out to be 191 for a population of 367 organizations. So, a total of 191 responses were requested from the target respondents. The emails were sent systematically through the official email of the researcher to the Heads of HR departments of financial sector organizations in Pakistan. A total of 157 usable questionnaires were responded to, yielding a valid response rate of 82.19% for the current study.

Given the complexity of the model, with multiple constructs, a mediating variable, and second-order dimensions, PLS-SEM was chosen for its strength in handling small samples and non-normal data while focusing on variance explanation [122,123]. Unlike CB-SEM, which tests model fit, PLS-SEM is better suited for theory building in exploratory studies like the present one [124,125]. This approach allows a deeper analysis of both the measurement and structural relationships in the model.

2.2. Measurements of Variables

For the current study, all adapted items are measured at the organizational level, and a seven-point Likert scale is used for these items that ranges from 1 = “strongly disagree” to 7 = “strongly agree”.

For the current study, we follow and adapt the HRIS effectiveness variable from the recent work of [87]. Measures for the three dimensions of HRIS effectiveness containing 31 items were adapted from the study of [87].

Measures for the information quality variable contain 10 items and are adapted primarily from the study of [126], with a reported reliability of 0.92. Similarly, the measures for the innovativeness of senior executives’ variable contain 4 items and are adapted primarily from the study of [43], with a reported reliability above 0.7. In addition, the measures for the IT capabilities of the staff variable contain 3 items and are adapted primarily from the study of [43], having reported reliability above 0.8.

In this study, in line with the conceptualization of the ambidexterity construct by [127] research, IS ambidexterity is measured as a second-order reflective-formative construct, which is consistent with previous scholars’ research (Mode B) [107,110,123,128]. Measures for these two dimensions of IS ambidexterity containing 5 items were adapted from the study of [53].

Pilot testing was done in order to assess the suitability of the instrument for current research. Firstly, the questionnaire was discussed with 3 professionals and 2 academics for its suitability and validity; the modified and updated instrument was then given to 40 relevant professionals for obtaining their response for the purpose of the pilot study. However, it is recommended that only 30 responses are sufficient for conducting the pilot study [129]. The increased number is to cater for lost, unanswered, and incomplete responses. The 36 valid responses were checked and included for conducting the pilot study. The results of reliability analysis were in an acceptable range as per previous literature [130]. Accordingly, Cronbach’s Alpha reported for all the variables ranged from acceptable to excellent ranges for the current study pilot testing phase.

3. Results

This study covered 367 financial sector organizations across five major cities of Pakistan. A sample of 191 organizations was selected using stratified proportionate systematic random sampling, dividing the population into five strata based on the four provinces, Baluchistan, Khyber Pakhtunkhwa, Punjab, and Sindh, and the capital territory of Islamabad. Data were collected from HR heads and senior HR officials, representing their respective organizations. The collection period spanned four months, from 4 April to 31 July 2024. Of the 191 questionnaires emailed, 159 were returned, yielding a response rate of 83.24 percent. After excluding two responses at the eligibility screening stage, 157 valid responses remained, resulting in a final usable response rate of 82.19 percent. This response rate is considered commendable for a survey aimed at an organizational analysis level [131].

3.1. Demographics

Table 1. Demographics (N = 157).

Grade/Designation of Respondents	Designation	Frequency
	CHRO (Chief Human Resource Officer)	16
	Head HR	115
	Head HRMS	1
	Head Operations HR	13
	Head Recruitment HR	1
	Senior Manager HR	11
Location of organizations	City	Frequency
	Islamabad	18
	Karachi	113
	Lahore	23
	Peshawar	2
	Quetta	1
Size of organizations	Organization Size	Frequency
	50 or Less	11
	51 to 250	40
	More than 250	106

shows the detailed demographics of the respondent organizations.

3.2. Common Method Bias

To reduce the risk of common method variance (CMV), several preemptive measures were taken in this study. These included careful selection and adaptation of scale items, ensuring respondent confidentiality, minimizing ambiguity, avoiding complex or double-barreled questions, and presenting items in a clear and straightforward manner. In this study, Harman’s one-factor test revealed that a single factor explained 26.737% of the total variance, which is below the 50% threshold often used to indicate potential common method bias [132,133]. This result indicates that common method bias is unlikely to significantly impact the data. Also, in this study, the response rate was 82.19%, well above the threshold of 50% considered sufficient to mitigate non-response bias [134,135], reducing concerns about non-response bias.

3.3. Measurement Model

In this study, a reflective-formative model (Type-II) was selected. This choice was made based on theoretical considerations and the nature of the latent variables involved. The growing attention to reflective-formative models in recent research, especially in social sciences [124,136,137], supports the appropriateness of this model for the present study. Further, to ensure consistency and accuracy in statistical modeling, all variables in this study were coded systematically for structural equation modeling (SEM) analysis. The dependent variable HRIS-Eff refers to overall Human Resource Information System (HRIS) Effectiveness, which had three first-order dimensions: HRIS-Eff-OPR (Operational), HRIS-Eff-REL (Relational), and HRIS-Eff-STR (Strategic). The independent variables were coded as follows: IQ for Information Quality, Innov for Innovativeness of Senior Executives, and IT-Cap for IT Capabilities of Staff. The mediating construct, Information System Ambidexterity, was denoted as ISAMB, with its sub-dimensions labeled as IS-Amb-EXPR (Explorative) and IS-Amb-EXPT (Exploitative).

In this study, all 53 items demonstrated factor loadings exceeding the recommended threshold of 0.50 [122], hence, eliminating the need for item removal. (See Figure 2,

Table 2. Assessments of measurement model (reflective constructs).

Construct	Items	Outer Loadings	Cronbach’s α (CA)	Composite Reliability (CR)	Average Variance Extracted (AVE)
IQ	IQ1	0.870	0.938	0.947	0.643
	IQ2	0.746
	IQ3	0.822
	IQ4	0.803
	IQ5	0.843
	IQ6	0.822
	IQ7	0.767
	IQ8	0.800
	IQ9	0.746
	IQ10	0.787
IT-CAP	IT-Cap1	0.841	0.795	0.88	0.709
	IT-Cap2	0.870
	IT-Cap3	0.815
INNOV	Innov1	0.834	0.883	0.919	0.741
	Innov2	0.896
	Innov3	0.873
	Innov4	0.838
IS-AMB
IS-Amb-EXPT	IS-Amb1	0.918	0.802	0.91	0.835
	IS-Amb2	0.909
IS-Amb-EXPR	IS-Amb3	0.820	0.781	0.873	0.696
	IS-Amb4	0.856
	IS-Amb5	0.826
HRIS-EFF
HRIS-Eff-STR	HRIS-Eff1	0.817	0.945	0.952	0.626
	HRIS-Eff2	0.747
	HRIS-Eff3	0.788
	HRIS-Eff4	0.818
	HRIS-Eff5	0.818
	HRIS-Eff6	0.811
	HRIS-Eff7	0.782
	HRIS-Eff8	0.785
	HRIS-Eff9	0.721
	HRIS-Eff10	0.769
	HRIS-Eff11	0.771
	HRIS-Eff12	0.858
HRIS-EFF-OPR	HRIS-Eff13	0.821	0.932	0.943	0.65
	HRIS-Eff14	0.833
	HRIS-Eff15	0.849
	HRIS-Eff16	0.827
	HRIS-Eff17	0.881
	HRIS-Eff18	0.775
	HRIS-Eff19	0.780
	HRIS-Eff20	0.747
	HRIS-Eff21	0.734
HIRS-EFF-REL	HRIS-Eff22	0.764	0.913	0.928	0.565
	HRIS-Eff23	0.802
	HRIS-Eff24	0.744
	HRIS-Eff25	0.798
	HRIS-Eff26	0.776
	HRIS-Eff27	0.800
	HRIS-Eff28	0.809
	HRIS-Eff29	0.806
	HRIS-Eff30	0.580
	HRIS-Eff31	0.586

).

In this study, convergent validity was assessed using the Average Variance Extracted (AVE) metric, which is considered satisfactory when it equals or exceeds the recommended threshold of 0.50 [138]. This threshold indicates that the items used in the measurement are effectively capturing the latent constructs. For the constructs in this study, AVE values ranged from 0.565 to 0.835, demonstrating a strong level of convergence. Therefore, all constructs met or exceeded the 0.50 threshold, confirming that the items reliably converge to measure their respective underlying constructs. This result signifies that convergent validity is adequately achieved across all constructs in the study.

Accordingly, the details of the AVE values for all constructs are given in

Table 3. Convergent Validity (AVE) of Constructs.

Construct	Average Variance Extracted (AVE)
HRIS-Eff-OPR	0.650
HRIS-Eff-REL	0.565
HRIS-Eff-STR	0.626
IQ	0.643
IS-Amb-EXPR	0.696
IS-Amb-EXPT	0.835
IT-Cap	0.709
Innov	0.741

.

In order to assess the discriminant validity for the current study, out of the three well-employed methods of; the Fornell-Larcker Criterion, Cross-Loadings, and the Heterotrait-Monotrait Ratio (HTMT), HTMT was used, and results are shown below in

Table 4. Discriminant Validity of Constructs HTMT.

	HRIS-Eff-OPR	HRIS-Eff-REL	HRIS-Eff-STR	IQ	IS-Amb-EXPR	IS-AmbEXPT	IT-Cap	Innov
HRIS-Eff-OPR
HRIS-Eff-REL	0.75
HRIS-Eff-STR	0.685	0.555
IQ	0.454	0.422	0.495
IS-Amb-EXPR	0.308	0.456	0.377	0.454
IS-Amb-EXPT	0.336	0.357	0.34	0.347	0.863
IT-Cap	0.548	0.538	0.585	0.499	0.351	0.401
Innov	0.541	0.339	0.397	0.406	0.161	0.208	0.321

.

To establish the validity, Outer loadings, Outer Weights and VIF were assessed. Outer loadings were significant and above the 0.5 threshold, while VIF values were below the threshold limit of 5 [124], confirming the validity of the constructs [122,123]. Henceforth, on the basis of all values meeting the designated criterion, validity for HOC was established. The findings demonstrated that all constructs met the criteria for reliability and convergent validity. Henceforth, the following assessments of the HOCs are presented in

Table 5. Validity of higher-order constructs HOCs.

Second Order (Formative) Construct	First-Order (Reflective) Construct	Outer Loadings	T Statistics	p Values	Outer Weights	VIF
HRIS-Effectiveness	HRIS-STR	0.864	13.175	0.000	0.569	1.370
	HRIS-OPR	0.679	8.233	0.000	0.158	1.537
	HRIS-REL	0.832	12.913	0.000	0.482	1.557
IS Ambidexterity	IS-AMB-EXPT	0.995	36.139	0.000	0.895	1.980
	IS-AMB-EXPR	0.772	7.239	0.000	0.142	1.980

.

3.4. Structural Model

In PLS-SEM, the structural model, also known as the “inner model,” represents the second stage of analysis.

In our analysis, as detailed in

Table 6. Inner VIF Values (n = 157).

Construct	HRIS-EFF	ISAMB
IQ	1.362	1.261
IT-Cap	1.293	1.142
Innov	1.326	1.213

, the VIF values for predictors such as information quality, IT capabilities, innovativeness of senior executives, and IS ambidexterity in relation to IS ambidexterity and HRIS effectiveness all fall between 1.039 and 1.326. These values are well under the critical threshold of 3, suggesting that multicollinearity is not a concern in our dataset.

For this study, the bootstrap procedure was conducted with 5000 samples, adhering to recommendations by [104]. In order to meet the objectives of the study, the structural (internal) model shown in Figure 3 presents the direct relationships hypothesized in this study.

The hypotheses from H1–H7 represent the direct relationships between the exogenous variables and the endogenous variable.

The first hypothesis (H1) is supported, as the results indicated that information quality has a significant relationship with HRIS effectiveness (β = 0.130, t = 1.666, p < 0.05). The second hypothesis (H2) evaluates whether the innovativeness of senior executives has a significant and positive relationship with HRIS effectiveness. The results indicated that the innovativeness of senior executives has a significant relationship with HRIS effectiveness (β = 0.144, t = 1.965, p < 0.05). Hence, H2 was supported. The third hypothesis (H3) is supported, as the results indicated that the IT capabilities of staff have a significant relationship with HRIS effectiveness (β = 0.339, t = 4.361, p < 0.01). The fourth hypothesis (H4) evaluates whether IS ambidexterity has a significant and positive relationship with HRIS effectiveness. The results indicated that IS Ambidexterity has a significant relationship with HRIS effectiveness (β = 0.197, t = 2.733, p < 0.01). Hence, H4 was supported.

The fifth hypothesis (H5), evaluating the relation between information quality and IS ambidexterity, is supported based on the results that indicated information quality has a significant relationship with IS Ambidexterity (β = 0.280, t = 2.705, p < 0.01). The sixth hypothesis (H6), evaluating the relation between the innovativeness of senior executives and IS ambidexterity, is supported. The results indicated that the innovativeness of senior executives has a significant relationship with IS Ambidexterity (β = 0.162, t = 1.871, p < 0.05). The seventh hypothesis (H7) evaluates whether the IT capabilities of staff have a significant and positive relationship with IS ambidexterity. The results indicated that the IT capabilities of staff have a significant relationship with IS Ambidexterity (β = 0.181, t = 1.991, p < 0.05). Hence, H7 was supported.

The results of all direct relationships (Hypotheses 1 to 8), including path coefficients, t-values, p-values, significance levels, and decisions of all direct relationships, are provided in

Table 7. Significance Results of the Structural Model Path Coefficients.

Hypothesis	Relation	Path Coefficient	T Statistics	p Values	Effect Size	Decision
H1	IQ → HRIS-EFF	0.130	1.666	0.048 **	0.023	Supported
H2	Innov → HRIS-EFF	0.144	1.965	0.025 **	0.030	Supported
H3	IT-Cap → HRIS-EFF	0.339	4.361	0.000 ***	0.171	Supported
H4	ISAMB → HRIS-EFF	0.197	2.733	0.003 ***	0.053	Supported
H5	IQ → ISAMB	0.280	2.705	0.003 ***	0.085	Supported
H6	Innov → ISAMB	0.162	1.871	0.031 **	0.029	Supported
H7	IT-Cap → ISAMB	0.181	1.991	0.023 **	0.037	Supported

Note: * p < 0.10; ** p < 0.05; *** p < 0.01.

.

A mediation model explores the process through which an independent variable (X) influences a dependent variable (Y) by way of one or more intermediary variables (M) [139,140].

For this study, the approach outlined by [139,140] was utilized to assess the significance of the indirect effect (a × b), rather than relying on traditional causal approaches that involve several assumptions. Their method, which includes bootstrapping the sampling distribution of the indirect effect, is recommended for its robustness [141]. Bootstrapping is a non-parametric technique that involves generating a large number of subsamples (e.g., 5000) with replacement from the original dataset [122]. If the indirect effect proves statistically significant (with a t-value exceeding 1.6 for a one-tailed test and p < 0.05), this provides substantial evidence of mediation [139].

Additionally, in this study, mediation will be considered “Supported” if the indirect effect is significant, indicating the presence of mediation, and “Not Supported” if the indirect effect is insignificant, suggesting the absence of mediation.

There were a total of three hypotheses to observe the mediating effect of IS ambidexterity on the association between independent and dependent variables. Details of mediation analysis for hypothesis 8 to hypothesis 10 are given in

Table 8. Mediation Analysis—Hypothesis 8–10.

Hypothesis	Relation	Total Effect		Direct Effect		Indirect Effect
		Coefficient	p Value	Coefficient	p Value	Path Coefficient	T Statistics	p Values	Decision
H8	IQ → ISAMB → HRIS-EFF	0.185	0.008	0.130	0.048	0.055	1.904	0.028	Supported
H9	Innov → ISAMB → HRIS-EFF	0.112	0.043	0.144	0.025	0.032	1.721	0.043	Supported
H10	IT-Cap → ISAMB → HRIS-EFF	0.375	0.000	0.339	0.000	0.036	1.741	0.041	Supported

.

The first mediation hypothesis (H8) evaluates whether information quality has an indirect effect on HRIS effectiveness through IS ambidexterity. The results (See Table 8) revealed that the total effect of information quality on HRIS effectiveness was significant (β = 0.185, t = 2.389, p < 0.05). Similarly, with the inclusion of the mediating variable (IS ambidexterity), the direct effect of information quality on HRIS effectiveness was also significant (β = 0.130, t = 1.666, p < 0.05). Additionally, the indirect effect of information quality on HRIS effectiveness was significant through IS ambidexterity (β = 0.055, t = 1.904, p < 0.05). Given the explanation of Preacher and Hayes (2004, 2008) [139,140], even though the total effect and the direct effect were significant, the indirect effect of information quality on HRIS effectiveness via IS ambidexterity is also significant. Therefore, H8 was supported.

The second mediation hypothesis (H9) evaluates whether the innovativeness of senior executives has an indirect effect on HRIS effectiveness through IS ambidexterity. The results (See Table 8) revealed that the total effect of the innovativeness of senior executives on HRIS effectiveness was significant (β = 0.112, t = 1.434, p < 0.05). Similarly, with the inclusion of the mediating variable (IS ambidexterity), the direct effect of innovativeness of senior executives on HRIS effectiveness was also significant (β = 0.144, t = 1.965, p < 0.05). Additionally, the indirect effect of the innovativeness of senior executives on HRIS effectiveness was significant through IS ambidexterity (β = 0.032, t = 1.721, p < 0.05). Given the explanation of Preacher and Hayes (2004, 2008) [139,140], even though the total effect and the direct effect were significant, the indirect effect of innovativeness of senior executives on HRIS effectiveness via IS ambidexterity is also significant. Therefore, H9 was supported.

The third mediation hypothesis (H10) evaluates whether the IT capabilities of staff have an indirect effect on HRIS effectiveness through IS ambidexterity. The results (See Table 8) revealed that the total effect of IT capabilities of staff on HRIS effectiveness was significant (β = 0.375, t = 4.862, p < 0.01). Similarly, with the inclusion of the mediating variable (IS ambidexterity), the direct effect of IT capabilities of staff on HRIS effectiveness was also significant (β = 0.339, t = 4.361, p < 0.01). Additionally, the indirect effect of IT capabilities of staff on HRIS effectiveness was significant through IS ambidexterity (β = 0.036, t = 1.741, p < 0.05). Given the explanation of [139,140], even though the total effect and the direct effect were significant, the indirect effect of IT capabilities of staff on HRIS effectiveness via IS ambidexterity is also significant. Therefore, H10 was supported.

Based on the R² thresholds proposed by [110,122,142,143], the model revealed a moderate coefficient of determination for HRIS effectiveness (R² = 0.499). This indicates that approximately 49% of the variance in HRIS effectiveness can be attributed to the variables under investigation, which include information quality, IT staff capabilities, senior executives’ innovativeness, and IS ambidexterity. Similarly, the coefficient of determination for IS ambidexterity was found to be moderate (R² = 0.323). This suggests that around 32% of the variance in IS ambidexterity is explained by the variables such as information quality, IT staff capabilities, and senior executives’ innovativeness.

The primary aim of this study was to investigate how information quality, IT staff capabilities, and senior executives’ innovativeness relate to HRIS effectiveness, with IS ambidexterity acting as a mediator. In pursuit of this objective, the study additionally assessed the effect sizes of all the exogenous (independent) variables on the endogenous (dependent) variables.

The f2 values (effect sizes) for all exogenous (independent) variables in direct relation to two endogenous (dependent) variables are summarized in

Table 9. Effect Size—f2 Values.

Relation	Effect Size
IQ → HRIS-EFF	0.023
IQ → ISAMB	0.085
ISAMB → HRIS-EFF	0.053
IT-Cap → HRIS-EFF	0.171
IT-Cap → ISAMB	0.037
Innov → HRIS-EFF	0.030
Innov → ISAMB	0.029

.

Notably, among these variables, IT capabilities of staff stand out with the highest f2 value (0.171), signifying a relatively robust influence in explaining the variability in HRIS effectiveness within the model. However, information quality has comparatively smaller effects (0.023).

These f2 values provide an indication of the magnitude of each variable’s influence on IS ambidexterity. Information quality exhibits the highest effect size (0.085), suggesting a relatively strong impact on IS ambidexterity, whereas the effect of innovativeness of senior executives is lowest (0.029).

In addition to evaluating predictive power with R-squared values, researchers should also consider another important quality criterion, the Stone-Geisser Q² value [144,145]. In the context of a structural model, if it is observed that the Q² values for a particular endogenous latent variable are greater than zero, it suggests that the observed path model has predictive relevance for that specific dependent construct [122].

For the current study, in order to obtain Q² values in Partial Least Squares Structural Equation Modeling (PLS SEM 4.0), PLS Predict is used, which is suggested to be included in the evaluation of PLS-SEM results [123,124].

The results have shown that Q² values for the endogenous variables, including HRIS effectiveness and IS Ambidexterity, are 0.393 and 0.222, respectively, whereby these positive values confirm the model’s predictive relevance. (See

Table 10. Predictive Relevance—Cross-validated Redundancy.

Endogenous Variables	Q2 Predict
HRIS-EFF	0.393
ISAMB	0.222

).

It is therefore observed that these figures offer quantitative proof of the model’s predictive strength and its ability to clarify the relationships between the chosen variables within Pakistan’s financial sector.

4. Discussion

This study probes into the important factors like information quality, innovativeness, IS ambidexterity, and IT capabilities influencing the effectiveness of Human Resource Information Systems (HRIS) in the context of the entire financial sector of Pakistan, a developing economy, with a specific focus on the advanced and matured implementation stage potentially leading to sustainable digital transformations. Present research integrates Resource-Based View (RBV) and Dynamic Capabilities theories and proposes a comprehensive framework that increases our understanding of HRIS effectiveness.

Adding uniqueness to the existing literature, this study fills a critical research gap by shifting focus from HRIS adoption to its post-implementation effectiveness, a phase rarely explored in the context of developing economies and tightly regulated industries in earlier studies. Integrating the Resource-Based View (RBV) and Dynamic Capabilities Theory (DCT), it offers a novel theoretical contribution by validating IS Ambidexterity as a mediating dynamic capability that links core organizational resources to sustainable digital performance depicting HRIS. Encompassing the entire financial sector, the organizational-level approach in Pakistan’s developing environments further distinguishes this research from prior individual-level or developed economies’ studies and advances past studies by offering empirical depth and theoretical clarity. These findings advance both academic understanding and managerial practice by demonstrating how human-driven IS enablers influence system-level resilience, AI readiness, and long-term sustainability objectives linked to ESG goals in post-pandemic remote-first transformations.

The research questions that needed to be addressed by this study were related to how various factors influence HRIS effectiveness in the context of the financial sector, which is observed to be mature in the use and investment of technology. Accordingly, information quality, innovativeness of executives, and IT capabilities of staff were empirically observed to have influenced HRIS effectiveness.

In addition, endorsing the prior research findings, IS ambidexterity was observed as a dynamic capability and a mediator in the relation between HRIS effectiveness and influencing factors acknowledged in the current research. A significant positive relation reveals the acceptance of the hypothesis proposed in accordance with the research questions and study objectives. The results significantly support the role of information quality, executives’ innovativeness, and staff IT capabilities as foundational drivers of HRIS effectiveness, highlighting how organizational readiness, agility, and competitiveness directly enhance the value derived from information systems.

The study highlights the growing importance of HRIS effectiveness in today’s business landscape, especially in light of the COVID-19 pandemic, which induced organizations to adapt to remote work environments, whereby Human Resources became the cornerstone of business continuity, and HRIS played an integral role in managing a geographically dispersed workforce. Moreover, the shift towards artificial intelligence (AI) in the recent past further underscores the need for robust HRIS systems, as AI’s potential is deeply intertwined with the quality of information processed by these systems. Being early adopters and heavy investors in advanced technology, the financial sector provides an appealing landscape for studying the influencing factors for HRIS effectiveness that ultimately contribute and lay down the foundations for successful implementation of AI technologies.

Further, in the financial sector, which is inherently information-sensitive, HRIS effectiveness is even more critical. The findings of the study suggest that the identified enabling factors are pivotal in ensuring the success of HRIS implementations.

This study sheds light on the influencing factors contributing to HRIS effectiveness and accordingly validates their role empirically in the context of the complete financial sector of Pakistan, providing a valuable contribution to the body of knowledge. In addition, the use of RBV and dynamic capabilities theories gives a theoretical insight into the influencing factors and particularly the mediating role exercised by the IS ambidexterity. This is one of the unique contributions of the present study in the context of completely covering the financial sector of a developing economy and integrating the theories of RBV and dynamic capabilities with IS ambidexterity.

Although the current study has made noteworthy contributions to the understanding of HRIS effectiveness and IS ambidexterity in the context of the financial sector of Pakistan, there are certain limitations that should be acknowledged. These limitations offer opportunities for improvement and extension in future research.

First, the study was entirely conducted within the financial sector based on the objectives of the study, although there are limited studies covering even the entire financial sector, and did not incorporate organizations from other service sectors; the findings, therefore, reflect the specific dynamics of financial institutions of Pakistan and may not be directly applicable to other industries. Increasing the scope to include diverse service sectors, such as healthcare and education, which are equally important in the context of HRIS because of the vitality of their workforce, could enhance the generalizability and augmentation of the conclusions. Comparative analyses across multiple industries would provide a broader understanding of HRIS effectiveness and its influencing factors and validate the findings in diverse organizational contexts.

Second, this study employed a cross-sectional research design, capturing data at a single point in time. This was, though, suitable for the current research context; however, a longitudinal study could provide a deeper understanding, which is recommended for future research.

Third, the study employed and observed the mediating role of IS ambidexterity as dynamic capability. This provided a valuable theoretical expansion of the concept; however, the dynamism of the concept of IS ambidexterity can also be explored with the lens of ambidexterity theory in the future. Similarly, other mediators like psychological empowerment of HRIS users, organizational agility, and digital readiness can also be explored that may influence the relation between HRIS effectiveness and its influencing factors.

5. Conclusions

Though grounded in HRIS, the current study offers broader relevance to resilience and sustainability in the domain of information system research, reinforcing that information quality, empowered IT-capable staff, and innovative strategic leadership are critical for leveraging IS ambidexterity in the dynamic, agile, and AI-driven, remote-first world. This study augments the literature with empirical evidence that HRIS effectiveness, when driven by quality information, executive innovativeness, and IT staff capabilities, can position financial institutions as leaders in sustainable and responsible tech adoption.

Correspondingly, the current study provides useful insights into the financial industry of Pakistan’s technological focus on achieving resilience and sustainability through improving the efficiencies in the context of human resource information systems. The study reveals that organizations in the financial sector of Pakistan are well aware of HRIS and its benefits, yet they are in a transitional process to realize and engage the full potential of the technology, just in line with the findings of other past research on the subject. However, the rapid advancements and technological disruptions have brought these organizations very close to exercising their full potential to explore and exploit technologies like HRIS for ensuring a sustainable information ecosystem. A notable contribution of this study is its focus on information quality as a foundational element in driving information systems effectiveness and success, leading to long-term organizational resilience and sustainability. By providing empirical evidence that validates the influence of information quality on HRIS effectiveness, the study not only aligns with prior research but also equips decision-makers with greater confidence to treat high-quality information as a critical organizational resource. Further, accepted hypotheses of the current study endorse the findings of previous research in the context of information systems.

In addition, there have been several important contributions made by this study in the overall understanding of HRIS effectiveness. This emphasizes the employing of RBV and dynamic capability theories, which, in the context of information systems and ambidexterity, have been pivotal in enhancing the understanding. Since information is one of the most valuable assets, understanding its dynamism in an organizational context and its utilization in the ambidextrous context gives a valuable contribution to the theoretical knowledge and provides the strategies for enhancements to managers and decision makers accordingly. The significant positive links between the independent variables and DV (HRIS effectiveness) extend the relevance of RBV within Pakistan’s financial sector, reinforcing its value in a developing economy. Inclusion of IS ambidexterity as a mediator also deepens the application of Dynamic Capability Theory, showing how balancing exploration and exploitation boosts HRIS effectiveness, endorsed with the empirical evidence from the current study. Together, these theories offer a well-rounded perspective on strategic HR perspective in relation to information systems sustainability.

Grounded in theory and validated through empirical rigor, this study provides actionable insights for practitioners and policymakers. HR leaders should institutionalize high-quality data governance, strengthen IT capabilities through ongoing training, and invest in leadership innovation to enhance HRIS outcomes. Policymakers are encouraged to establish maturity benchmarks for HRIS use and incentivize adoption based on impact metrics. Also, it extends to them the understanding of how to avoid IT investments’ value loss to avoid projects and organizational failure by gaining economic advantage. The study’s key contribution lies in framing HRIS not as an administrative tool but as a strategic lever for digital resilience and ESG-aligned innovation in post-pandemic financial ecosystems. By extending the RBV-DCT interface and confirming IS Ambidexterity’s mediating role, it underscores how dynamic human and system capabilities must co-evolve to sustain information system value in volatile digital environments. These conclusions provide both practical pathways and conceptual direction for future sustainable digital transformation research.

This study has meaningfully contributed to the understanding of the factors that influence HRIS effectiveness in the overall financial sector of Pakistan, with a keen focus on the mediating role of IS ambidexterity. By examining the relation between information quality, executive innovativeness, IT staff capabilities, IS ambidexterity, and HRIS effectiveness, this study offers a comprehensive understanding of how organizational resources shape long-term sustainability through information system effectiveness and success. While HRIS represents just one domain-specific information system, the findings of this study extend broader relevance to sustainable digital transformations through well-employed information systems, reinforcing that the information remains one of the foundational and critical success factors in today’s era of AI integration, remote work, and post-COVID-19 digital transformations. Further, the study settles that in tightly regulated sectors such as finance, robust information systems underpin the strategic use of technologies, not limited to even AI, to ensure not only efficiency but also the resilience and sustainability of digital ecosystems.