The Interplay between Absorptive Capacity and Organizational Support and Its Influence on Employee Performance

Abstract

Nowadays, knowledge has played an important role in every aspect of life, including in business environment. This knowledge is very important to support company’s competitive advantage. However this knowledge cannot stand alone it needs to be transferred to and absorbed by an individual to achieve best results. This absorptive capacity would enhance the ability to create or find new external knowledge, assimilate it, and then exploit it for commercial ends. There have been several researchers in the past who discussed about the importance of absorptive capacity in the firm level; however there were very few researchers studying about absorptive capacity on the individual level. This individual level absorptive capacity plays a critical role since the individual will directly contribute to the company’s output. Besides, organizational support would affect the transformation of knowledge after it is acquired and assimilated. The training and also knowledge sharing support given by a company will enhance the development of knowledge transfer. It is believed that individual or employee in an organization who received support and training will have better skill to transform and exploit better the new external knowledge they had acquired and assimilated. The results from this research with the sample of 151 respondents show that there is a positive effect between potential absorptive capacity and realized absorptive capacity, hence it would also has positive effect towards performance. Besides, this research also found that knowledge sharing support moderates the relationship between potential absorptive capacity and realized absorptive capacity. This means that this knowledge sharing support will have important role in the process of knowledge absorption and implementation.