Abstract
ABSTRACT Absorption capacity (ACAP) is a fundamental factor for the firm to achieve dynamic capability and competitive advantage. Previous studies have identified two dimensions that make up this construct, called potential absorption capacity (PACAP) and realized absorption capacity (RACAP). This study investigates the influence of the two dimensions of ACAP in relation to project performance and innovation, and also analyzes the mediating role that RACAP plays in the relationship between PACAP and project performance and innovation. This study explores these relationships using the structural equation modeling (SEM) method, using the partial least squares (PLS) approach, applied to a sample of 128 companies in the automotive sector, specifically manufacturers of parts. The results show that project performance and innovation are impacted differently by PACAP and RACAP. In addition, the study shows that RACAP plays a mediating role in the relationship between PACAP and project performance and innovation.
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