Organizational Absorptive Capacity Research Articles

The Relationship between Business Intelligence and Analytics Use and Organizational Absorptive Capacity: Applying the DeLone & Mclean Information Systems Success Model

Building on the DeLone and McLean Information Systems (IS) success model and the knowledge-based theory of absorptive capacity, this paper examines the role of the business intelligence and analytics (BI&A) use for enhancing a firm’s absorptive capacity for knowledge creation. We collected survey data from an online and mail-delivered survey questionnaire with 97 respondents at the organizational level in the Slovenian medium- and large-sized firms from several industries. The results from the partial least squares SEM showed that the BI&A use relates significantly to absorptive capacity enhancement, thus fostering knowledge creation. Moreover, information quality and system quality are positively linked with BI&A use at the organizational level. https://doi.org/10.15458/ebr99

How Formal Institutions Interact with the Organizational Drivers of New Platform Technology Adoption

Although there has been a recent surge in research on the drivers of technology adoption, our understanding is still limited to adoption in a single national context. That is, we still lack an understanding of how the effects of micro-level factors on technological adoption depend on differences in national contexts. Attempting to bridge the gap between international business and strategy research, we propose that technology adoption depends on both micro (organizational absorptive capacity and managerial attention) and macro (i.e., formal institutional environment) factors as well as their interplay. The study tests a moderated mediation model on the responses of Ericsson’s clients around the globe (89 telecommunications operators from 79 countries) to the offering of Cloud technology. We find that the influence of organizational absorptive capacity on technology adoption manifests itself partly through managerial attention. We also find that the firm’s absorptive capacity compensates for the regulatory system’s lack of quality for new technology adoption. Besides, the absorptive capacity is particularly important in directing managerial attention to the new technology in countries with a lower quality of regulatory systems.

Effects of high-performance work systems (HPWSs) on intellectual capital, organizational ambidexterity and knowledge absorptive capacity: evidence from the hotel industry

ABSTRACT The aim of the current study is to investigate the effects of high-performance work systems (HPWSs) on intellectual capital, organizational ambidexterity and knowledge absorptive capacity. The research hypotheses were tested via Structural Equation Modeling. The data were collected from senior managers of four and five-star hotels. The findings mainly indicate that intellectual capital acts as a full mediator of the effects of HPWSs on organizational ambidexterity and knowledge absorptive capacity. Organizational ambidexterity and knowledge absorptive capacity have not yet been adequately discussed in the context of the hotel industry. Furthermore, there is very little empirical evidence in the literature on the antecedents and consequences of intellectual capital in the hotel industry. Therefore, the current study contributes to the literature by demonstrating that intellectual capital acts as a mediator linking HPWSs to organizational ambidexterity and knowledge absorptive capacity.

Development of absorptive capacity in a regional innovation system: experience of Lithuanian regions

The importance of innovativeness and competitiveness is rising and it is the essential condition for the survival in a global market. Especially it is vitally important for small countries (and their regions), which do not have the exceptional situation and position in the market, acknowledged products (services) or resources, even stable long-term traditions of innovation culture, etc.
 The present paper focuses on absorptive capacity, its development issues in regional innovation systems and well-being creation in a small country’s regions. For the purposes of the research, analyses were carried out, identifying reasons (or barriers), promoting (or limiting) innovative activities, impeding organizational propensities and desire to develop activities of knowledge access, anchoring and diffusion at the organizational and inter-organizational level. This paper reveals the experience of Lithuanian regions from the point of view of experts, representing institutions of science, business, innovation and business support. This paper represents the experience of partnerships (successful and failed) for the knowledge absorption in Lithuania and their connection to subsequent directions of organizational behavior and decisions. Furthermore, the author suggests main aspects for managers, seeking to maintain (gain) organizational absorptive capacity, corresponding to requirements and speed of the modern market.

Exploring the elements of absorptive capacity: large-scale interview study of 61 companies in Estonia

The increasingly dynamic business environment encourages companies to combine externally available information and internal ideas to maximise company performance. A company's ability to capture external knowledge and to use it for its own benefit is shaped by organisational absorptive capacity. Using data gathered from interviews with 61 Estonian companies, this research attempts to further investigate a recently proposed model of absorptive capacity suggesting that it is a set of simultaneous, rather than consecutive, elements. The paper provides an in-depth study of the suggested elements and patterns that make up the phenomenon of absorptive capacity and demonstrates that companies value external information, sourcing it and making their strategic choices based on the competitive situation. While providing support for the proposed model of absorptive capacity, the results also reveal common elements of its subsets: process-driven innovation, reliance on competitors and clients and the importance of employees.

Exploring the elements of absorptive capacity: large-scale interview study of 61 companies in Estonia

The increasingly dynamic business environment encourages companies to combine externally available information and internal ideas to maximise company performance. A company's ability to capture external knowledge and to use it for its own benefit is shaped by organisational absorptive capacity. Using data gathered from interviews with 61 Estonian companies, this research attempts to further investigate a recently proposed model of absorptive capacity suggesting that it is a set of simultaneous, rather than consecutive, elements. The paper provides an in-depth study of the suggested elements and patterns that make up the phenomenon of absorptive capacity and demonstrates that companies value external information, sourcing it and making their strategic choices based on the competitive situation. While providing support for the proposed model of absorptive capacity, the results also reveal common elements of its subsets: process-driven innovation, reliance on competitors and clients and the importance of employees.

THE ANTECEDENTS OF RECOGNIZE THE VALUE IN THE ABSORPTIVE CAPACITY

ABSTRACT Purpose: The ability of individuals to recognize the value of external, corporate-applicable information is critical to organizational absorptive capacity. This study aims to define and operationalize the recognize the value construct, identify its antecedents and predictive power. Originality/value: It analyzes how this construct occurs at the level of the individual, workgroups and processes, besides indicating its relationship with the other predictors present in the literature. The theoretical bases can be classified by Cohen and Levinthal (1990) and Zahra and George (2002). The first one considers absorptive capacity as a stock of knowledge, the second one, as dynamic capacity. Design/methodology/approach: We adopt the Structural Equation Modeling technique to test a variance model, with four predictors of general recognize the value. We use a non-probabilistic sample consisting of 283 individuals who answered an electronic questionnaire. Findings: The results are satisfactory, as the model shows a 40% prediction power of how recognize the value occurs. The work processes were found to show higher predictive power (β = 0.417), meaning that that processes of recognize the value are enablers of the organizational recognize the value of new information. The other hypotheses were also supported, but with comparatively minor effects. The study is limited to the identification and analysis of the effects of predictors and does not contemplate its consequences, whose research is suggested.

How Do Organizational Absorptive Capacity and Entrepreneurial Social Networks Enhance Revenue Growth

This research explores the influence of organizational absorptive capacity on firm revenue growth through a lens of entrepreneurial social network structural holes, by asking the questions that i) to what extent does a firm’s absorptive capacity interact with its entrepreneurial social network? And moreover, ii) how do a firm’s absorptive capacity and entrepreneurial social network together influence its revenue growth? Results of survey data from 357 Chinese local entrepreneurial firms show that not only the organizational absorptive capacity and entrepreneurial social network structural holes have their direct positive effect on firms’ revenue growth, but also their positively moderating effect in the relationship of one the other with firms’ revenue growth. The research offers insights to both the theory of social networks, as well as to the perspective of absorptive capacity, by showing that i) a firm’s entrepreneurial social network structural hole can promote the firm’s financial performance by raising one of its collective capabilities; ii) both a firm’s collective absorptive capacity and entrepreneurial social network are likely to enhance the relationship of one the other and the firm revenue growth; and by being iii) one of the first entrepreneurship studies that look into a firm’s collective absorptive capacity through an external social network lens.

Reconciliation of deterministic and knowledge management approaches for a better understanding of SFA’s impact on salespersons’ performance

PurposeThe purpose of this study is to reconcile the deterministic and the knowledge management approaches to investigate a framework that provides an explanation of the sales force automation (SFA) practices’ impact on salespersons’ performance through the organizational absorptive capacity in the African pharmaceutical industry.Design/methodology/approachAn exploratory study was conducted to understand SFA uses in the pharmaceutical industry; then a total of 186 medical representatives were sampled and partial least squares analysis was performed.FindingsThe results identified the positive impact of organizational absorptive capacity on SFA use. In addition, the use of the SFA positively influenced the salespersons’ performance. Finally, age plays a positive moderating role in the relationships between use of SFA as a tool for internal coordination between actors and salespersons’ performance.Practical implicationsThis research could be useful for managers of pharmaceutical laboratories to SFA use as a tool of coordination between the actors, as a tool of management of the customer relationship and as a tool of management knowledge.Originality/valueIn contrast with the existing studies dealing with deterministic approach when studying the use of SFA, this study exploited the reconciliation between deterministic and knowledge management approaches to propose a conceptual framework dealing with the relationship between the SFA use, the organizational absorptive capacity and the salespersons’ performance in the pharmaceutical industry. This research proposed and tested a framework adapted to the African context.

Harnessing business analytics value through organizational absorptive capacity

Business analytics (BA) is a resource-intensive, risky endeavor. However, the literature has not addressed the important question of how to assimilate BA technologies for competitive advantage. We build a research framework and outline the BA assimilation mechanisms through organizational absorptive capacity (AC). Data were collected from 600 companies across six countries and analyzed using partial least squares. The findings revealed that organizational AC plays a crucial mediating role between BA competency and BA assimilation, leading to competitive advantage. This study contributes significantly to both information technology assimilation and BA value research by incorporating the role of organizational AC.

Examining Organizational Absorptive Capacity Construct: A Validation Study in the School Context

ABSTRACT The purpose of this study was to develop a new measure for the absorptive capacity (ACAP) construct, specifically in the educational system. Exploration of this construct involved developing, field testing, and validating an ACAP-measuring instrument, followed by exploratory and confirmatory factor analyses of the items to examine factorial validity. Two samples were derived to examine the construct’s validity. The developed scale was correlated with other established work-related constructs (e.g., teacher’s affective commitment). It was found that the four ACAP dimensions underlying potential (acquisition and assimilation) and realized (transformation and exploitation) ACAP are not only theoretically but also empirically distinguishable.

Synergizing independent and cooperative R&D activities: the effects of organisational slack and absorptive capacity

ABSTRACTFirms undertaking independent and cooperative research and development (R&D) activities simultaneously often have difficulties to realise their synergistic effects. This study contends that such difficulties are caused by tensions between two types of R&D activities in terms of resource competition and knowledge leakage. Moreover, organisational slack and absorptive capacity may affect these tensions and thereby play important role in synergizing independent and cooperative R&D activities. Based on a survey data of 286 firms, this study finds that such two types of R&D activities jointly have a negative impact on firm performance. Furthermore, organisational slack aids in synergizing them, while absorptive capacity has an adverse impact. These findings enrich our knowledge on the interrelation of independent and cooperative R&D activities and shed light on how firms can synergize them.

Impact of Organizational Learning and Absorptive Capacity on the Abnormal Returns of Acquirers: Evidence from Cross-Border Acquisitions by Indian Companies

The intent of the research paper has been to evaluate the short-term performance in terms of abnormal returns to the announcement of cross-border acquisitions (CBAs). This research work is based on 139 acquisitions undertaken by Indian companies during 2012–2016. The event study methodology has been applied to assess the effect of acquisition announcement on the short-run performance of the bidding firm. Later on, adopting the conceptual framework of organizational learning and absorptive capacity of the organization, a disaggregative analysis has been conducted to ascertain the factors affecting short-run performance. The results indicate that on an average, CBAs have statistically significant and positive valuation effects for the Indian bidders in the short-run. Further, a disaggregative analysis shows that previous CBA experience and horizontal acquisitions have positive and significant valuation effects for the acquirers. Similarly, the age of the acquirer has been observed to exert a favorable influence on its own valuation post-acquisition. However, smaller firms vis-a-vis mid- and large-sized firms generate more abnormal returns. The paper attempts to extend the application of organizational learning theory and absorptive capacity to the field of corporate mergers and acquisitions by analyzing the equity market response to the public announcement of cross-border acquisitions and antecedents of such response.

Strategies for maximizing organizational absorptive capacity

PurposeThe purpose of this paper is to discuss strategies for maximizing organizational absorptive capacity.Design/methodology/approachThe views presented here have been derived from authors’ extensive research and professional experience. Support for the claims made is provided through anecdotal evidence and related literature.FindingsThe viewpoint discusses how organizational absorptive capacity may be maximized through actions and interactions of a wide range of individual, managerial, organizational, and inter-organizational factors.Originality/valueThe viewpoint may assist practitioners with developing strategies for improving vicarious learning. From a theoretical perspective, the claims made in the paper present fertile ground for future empirical testing.

External knowledge sources, green innovation and performance

Theoretically speaking knowledge sharing seems relevant for innovations in general. Yet, there is no adequate understanding of how knowledge sharing can develop green innovation in SMEs. This paper focuses on how internal and external knowledge sharing intercede green innovation and ponders on how it affects the organization performance. First, the empirical results show that all types of external knowledge don't convey the same green innovative outputs. Second, they reveal that the success of the innovation process is strongly impacted by the access to knowledge sources but above all by the combination of internal and external knowledge in each phase of the green innovation process. The success of green innovations unveils the organizational absorptive capacity of external knowledge and their transformation into internal skills. Eventually, the risks associated with knowledge transfer can hinder the positive relationship between green innovation and the firms' performance. It also leads to the financial failure of green innovations.

Leadership and Employees’ Innovative Work Behavior: Test of a Mediation and Moderation Model

The aim of this study is to determine the relationship between Transformational (TFL)/ Transactional (TSL) leadership and employees’ Innovative Work Behavior (IWB), through a mediation and moderation model. The proposed model postulates that Organizational Climate for Innovation (OCI) and Organizational Absorptive Capacity (OAC) exert a mediating role whereas Employees´ Work Engagement (EWE) has a moderating effect in such relationship. A total of 267 Colombian workers from different kind of companies completed a reliable battery of questionnaires. The sample was collected through the MBA programs from two recognized universities located in Bogotá, Colombia. Structural equation modeling and hierarchical regression analyses were used to test the proposed model. According to the results, there is a direct and positive relationship between TFL and IWB as was expected. However, contrary to what had been hypothesized, TSL demonstrated to exert the same positive linkage. OCI and OAC showed its mediator effect in the relationship between TFL/TSL and IWB, nevertheless, this effect was less strong than when the relationship between theses variables was direct. On the contrary, EWE does not exert a moderator effect in this relationship as it was posited, but shows a significant and direct relationship with IWB. This research allows assert that leadership influences IWB, either directly or mediated by organizational variables. These results contribute to extent the literature in a scarcely studied field, by testing an empirical model.

Necessitated absorptive capacity and metaroutines in international technology transfer: A new model

International technology transfer of advanced technology and knowledge and their subsequent absorption is crucial to firms in developing nations. This research paper aims to further enhance the understanding and operationalization of the absorptive capacity construct. In the rigorous review of existing literature, organizational routines were found to play a significant role in enhancing an organization's absorptive capacity. We present our conceptualization of necessitated absorptive capacity as a dynamic organizational capability in the Necessitated Absorptive Capacity model. This paper contributes to the existing literature by providing a new model and an enhanced understanding and further operationalization of absorptive capacity.

Organizational citizenship behavior and the enhancement of absorptive capacity

Firm-level absorptive capacity has been conceptualized as the capability of the firm to identify, assimilate/transform, and exploit new knowledge. Despite the fact that the role of individuals strongly influenced the original conceptualization of the construct, the role of individuals in developing organizational absorptive capacity has been largely ignored. Meanwhile, studies have shown that individual-level behaviors known as organizational citizenship behaviors are related to indicators of organizational performance, yet there have been relatively few theoretically-based arguments explaining this relationship. In this paper, we articulate a model that depicts how the organizational citizenship behaviors of individuals enhance a firm's absorptive capacity. Specifically, we propose that citizenship behaviors moderate the relationship between routines and processes and the exploratory, assimilative, transformative, and exploitative learning capabilities that comprise organizational absorptive capacity.

CONSEQUENCES AND ANTECEDENTS OF ABSORPTIVE CAPACITY IN A CROSS-CULTURAL CONTEXT

Continuous innovation is one of the key challenges businesses are currently facing, which makes organisational absorptive capacity (ACAP) — a firms ability to explore and exploit external knowledge — a highly relevant topic. This study addresses ACAPs consequences and antecedents in an international context by analysing data from 549 small and medium-sized companies in Austria, Brazil, Germany, India, Singapore, and the US First, we reveal that both potential and realised ACAP have an equally strong positive impact on firm performance around the world. Second, we assess that the relationship between organisational structure and potential ACAP is not moderated by national cultural values. Furthermore, we show that the role a formalised organisational structure plays with regard to realised ACAP is positively moderated by the national cultural characteristic of power distance and negatively by the national cultural trait of masculinity. In contrast, masculinity positively moderates the relationship between specialisation and realised ACAP. Overall, with our study, we advance research on the consequences as well as the antecedents of ACAP and provide managers with mechanisms to support corporate knowledge absorption and innovation generation throughout the world.

The challenges of radical innovation in Iran: Knowledge transfer and absorptive capacity highlights — Evidence from a joint venture in the construction sector

We investigate the collaboration between an Iranian and a French company in a joint venture aimed at developing radical innovation in the construction sector. We identify the challenges involved, the barriers to technological change, and the difficulties of transferring knowledge related to absorptive capacity.We conduct an in depth case study of a joint venture created by Freyssinet and Azaran to build a new roof to the Mashhad stadium. We conducted 41 interviews over a 19month period.Our findings indicate that radical innovation is characterized by safety, quality, and planning challenges which engender delays, non-conformity to specifications, and additional costs. Freyssinet was unsuccessful in transferring explicit and tacit knowledge because Azaran suffered from poor organizational absorptive capacity. Its high absorptive capacity allowed Freyssinet to adapt its operations to Azaran's tacit knowledge routines.Our research is meaningful to the construction sector, an economically and socially significant sector in Iran that faces serious issues. Our study has practical implications for Iranian firms and for foreign firms operating in Iran. We contribute to strengthen the understanding of Iranian technology development by focusing on radical innovation standards, joint venture specific learning dyads, and complex knowledge transfer.