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Article
Publication date: 11 December 2019

Suming Wu, Xiuhao Ding, Ruihong Liu and Hui Gao

Open innovation and information systems have been key topics in the theoretical domain, but little empirical research thoroughly examines how information technology (IT…

Abstract

Purpose

Open innovation and information systems have been key topics in the theoretical domain, but little empirical research thoroughly examines how information technology (IT) capability affects open innovation performance. Thus, the purpose of this paper is to explore the relationship between IT capability and open innovation performance and to expose the inner mechanism at the firm level.

Design/methodology/approach

This paper collected firm-level data in China; 232 usable questionnaires from different firms were collected. Then, the study used a structural equation model by AMOS for hypothesis testing.

Findings

The results indicate that both internal IT capability and external IT capability have positive impacts on open innovation performance; potential absorptive capacity and realized absorptive capacity mediate the relationship between external IT capability and open innovation performance. Additionally, realized absorptive capacity plays a mediating role in the relationship between internal IT capability and open innovation performance.

Practical implications

These findings indicate that practitioners should pay attention to the important relationship between absorptive capacity and IT capability and open innovation performance in Chinese businesses.

Originality/value

Existing research has emphasized the influence of IT on open innovation, but empirical studies have not thoroughly focused on the inner mechanisms of the effect of IT capability on open innovation performance. Drawing on firm capability theory, this paper classifies IT capability as internal and external IT capability and absorptive capacity as potential and realized absorptive capacity. Then, this paper confirms the mediating role of absorptive capacity between IT capability and open innovation performance.

Details

European Journal of Innovation Management, vol. 24 no. 1
Type: Research Article
ISSN: 1460-1060

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Article
Publication date: 3 February 2012

Jim Andersén and Johan Kask

Absorbing knowledge from partner firms is a key feature of marketing relationships. Recent publications have called for more dynamic and cognitive approaches in marketing…

Abstract

Purpose

Absorbing knowledge from partner firms is a key feature of marketing relationships. Recent publications have called for more dynamic and cognitive approaches in marketing relationship research. Also, established definitions of absorptive capacities have been questioned. This article aims to address propositions that take these overlooked and questioned elements into consideration, which can help explain conducts and dependencies, and affect relationship durability.

Design/methodology/approach

The authors put forward four propositions by combining literature on interfirm relationships and managerial cognition with evolutionary ideas from marketing and management literature.

Findings

The authors embrace a redefinition of potential absorptive capacity (the disposed capacity to absorb knowledge) and realized absorptive capacity (the absorption of knowledge actually performed). This distinction can, to some extent, be explained by the degree of cognitive attention given to the marketing relationship. Moreover, asymmetrically realized absorptive capacity vis‐à‐vis a partner substantially influences the dynamics of partners' conduct and dependency, which may vary the risk that the relationship will end.

Practical implications

The propositions illustrate how a motivated partner that gives more attention to the relationship is more likely to absorb more knowledge than its counterpart, which can threaten the durability of a relationship. Thus, managers need to be able to understand possible long‐term consequences of the partner's conduct in order to avoid losses of joint strategic resources and relational benefits.

Originality/value

By advocating an evolutionary approach, an impetus for more dynamism in marketing relationship research is presented. This study also shows the importance of including the longitudinal dimension in analysis if one wants to understand change in – and durability of – marketing relationships.

Details

Management Decision, vol. 50 no. 1
Type: Research Article
ISSN: 0025-1747

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Article
Publication date: 15 February 2013

Craig E. Armstrong and Cynthia A. Lengnick‐Hall

The purpose of this paper is to perform empirical tests to explore the influence of social integration mechanisms on organizations’ absorptive capacities theorized by…

Abstract

Purpose

The purpose of this paper is to perform empirical tests to explore the influence of social integration mechanisms on organizations’ absorptive capacities theorized by Zahra and George.

Design/methodology/approach

This study uses a cross‐sectional design to test the relationships between potential absorptive capacity, three social integration mechanisms (cross‐functional teams, participation in decision making, and self‐managing teams), and realized absorptive capacity, in a sample of 92 organizations that bid competitively to provide products and services to a US university.

Findings

An organization's use of cross‐functional teams is negatively related to its realized absorptive capacity and negatively moderates the relationship between potential and realized absorptive capacity. Self‐managing teams negatively moderate the relationship between an organization's potential absorptive capacity and its realized absorptive capacity.

Research limitations/implications

The cross‐sectional design allows tests of relatedness but does not support cause‐and‐effect inferences.

Practical implications

Managers who follow the prescriptive implications of using social integration mechanisms to enhance their organization's absorptive capacity may actually hinder it. The type of social integration mechanism is an important consideration for managers of firm strategies.

Originality/value

This study extends and challenges the literature on absorptive capacity through its empirical analysis of the role of social integration mechanisms on an organization's absorptive capacity. Social integration mechanisms can have mixed moderating effects on the absorptive capacity development process, and potential absorptive capacity is not easily transformed into realized absorptive capacity. This study expands the context of absorptive capacity beyond R&D settings and incorporates a task environment that allows a direct linking of inputs and outputs.

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Article
Publication date: 19 June 2020

Chang Lu, Bo Yu, Jing Zhang and Dan Xu

The purpose of this study is to investigate the relationships between two types of open innovation (OI) strategies (OI breadth and depth) and innovation performance of…

Abstract

Purpose

The purpose of this study is to investigate the relationships between two types of open innovation (OI) strategies (OI breadth and depth) and innovation performance of small- and medium-sized enterprises (SMEs) in China. The study examines how firms’ absorptive capacity and government institutional support affect these relationships.

Design/methodology/approach

Survey data from 236 manufacturing SMEs in China were used to test the proposed model using hierarchical regression analysis.

Findings

The results show that both OI breadth and depth are positively related to innovation performance of SMEs. Moreover, this study finds that realized absorptive capacity serves as a mediator in the relationships between OI breadth and depth and innovation performance. The potential absorptive capacity and government institutional support moderate the relationship between OI breadth and innovation performance.

Originality/value

The effectiveness of OI strategies is significantly different among SMEs. One possible explanation is that SMEs adopt different types of OI strategies. Another is that a firm’s absorptive capacity and government institutional support may influence the effectiveness of OI. This study integrates these two possible reasons by investigating the effect of the interplay between different OI strategies, absorptive capacity and government institutional support on SMEs’ innovation performance. This study enriches the research on the relationships between OI strategies and innovation performance of SMEs in the Chinese context.

Details

Chinese Management Studies, vol. 15 no. 1
Type: Research Article
ISSN: 1750-614X

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Article
Publication date: 28 November 2019

Syed Saad Ahmed, Jia Guozhu, Shujaat Mubarik, Mumtaz Khan and Essa Khan

The purpose of this paper is to empirically examine the mediating role of potential and realized absorptive capacity in intellectual capital (IC) and business performance…

Abstract

Purpose

The purpose of this paper is to empirically examine the mediating role of potential and realized absorptive capacity in intellectual capital (IC) and business performance. It also investigates the direct impact of the components of IC on business performance.

Design/methodology/approach

Partial least square-structural equation modeling (PLS-SEM) was used to assess the effect of IC dimensions on performance and to analyze the mediating role of absorptive capacity in this relationship. Data were collected from 192 managers using a survey questionnaire with Likert scale items.

Findings

The findings of the study show that potential absorptive capacity does not intervene in the relationship between the components of IC and those of business performance. However, realized absorptive capacity, measured as the transformation and exploitation of knowledge, played a positive mediating role in the relationship between the dimensions of IC and those of business performance. Social capital was also noted as a weak predictor of business performance, while human capital and organizational capital had a profound positive influence.

Originality/value

This study contributes to the literature on IC by examining the role of realized and potential absorptive capacity in the relationship between IC components and firm performance. This research also helps practitioners recognize the importance of transformation and the exploitation of knowledge for business performance.

Details

Journal of Intellectual Capital, vol. 21 no. 1
Type: Research Article
ISSN: 1469-1930

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Article
Publication date: 29 March 2019

Sanjay Chaudhary

Despite the established significance of absorptive capacity, there is a worrying lack of research that empirically examines its antecedents. With a call for investigation…

Abstract

Purpose

Despite the established significance of absorptive capacity, there is a worrying lack of research that empirically examines its antecedents. With a call for investigation guided by the knowledge-based theory, the purpose of this paper is to bridge any probable gap by exploring the effect that an organization’s knowledge stock and its knowledge integrating mechanisms have on the development of its absorptive capacity.

Design/methodology/approach

On the basis of a survey administered to a sample comprising owners of small Indian automotive firms, this paper empirically examines the direct effect of an organization’s knowledge stock (including knowledge breadth and depth) and the moderating role of its structure-related mechanisms (e.g., formalization) on its potential and realized absorptive capacities. The study uses survey data from 226 small business owners and multiple linear regression analysis to examine the significance of its hypotheses.

Findings

The results show that knowledge stock has a statistically notable influence on a small firm’s absorptive capacity. The enabling role of formalization in the relationship between knowledge stock and absorptive capacity is also evident.

Practical implications

Given the handicap of small firms vis-à-vis large firms to deploy internal R&D capabilities, business owners must ensure not to confuse absorptive capacity with the pre-existence of R&D capabilities.

Originality/value

The unbundling of knowledge stock into breadth and depth of knowledge enables business owners and researchers to understand how any particular knowledge stock can relate to an organization’s absorptive capacity.

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Article
Publication date: 20 April 2020

Manzoor Ul Akram, Koustab Ghosh and Rojers P. Joseph

This study aims to investigate the external knowledge search behaviors in terms of search breadth and search depth in family firms and the resultant product innovation in…

Abstract

Purpose

This study aims to investigate the external knowledge search behaviors in terms of search breadth and search depth in family firms and the resultant product innovation in Indian context. The authors theorize the mediating role of absorptive capacity (potential and realized absorptive capacity) between knowledge sourcing from external sources and product innovation. Further, the authors examine the moderating role of crucial internal social capital of the family firm in enhancing the use of external knowledge for firm innovation activities.

Design/methodology/approach

The study uses a quantitative research design taking single informant for collection of data from 151 family small and medium enterprises in automotive sector in India. The authors use structural equation modeling to test hypothesized relationships.

Findings

The findings indicate that both search breadth and search depth of family firms are positively associated with product innovation in family firms. The authors also find evidence for partial mediating role of potential and realized absorptive capacity in the relationship between search breadth and innovation and search depth and innovation. The results show how family firms learning taking place while scanning external knowledge sources in terms of external absorptive capacity routines. Finally, the authors find that family firm internal social capital positively moderate the relationship between search breadth and depth, and product innovation.

Practical implications

Family firms need to innovate to remain relevant in the long-run and as such development of superior capabilities is of great significance to them. Family firm managers must be open to external knowledge as such knowledge help them improve the firm level of innovation through absorptive capacity. Further, family firms must realize and act upon the importance of their social capital for the integration and utilization of acquired knowledge.

Originality/value

This paper is amongst a few papers that take dynamic capability views of innovation in family firms wherein the authors theorize how external search breadth and depth lead to the development of potential and realized absorptive capacity in family firms. The importance of family firm internal social capital as a strong integrating and knowledge sharing mechanism that helps family firms transform external knowledge into innovation is also highlighted.

Details

VINE Journal of Information and Knowledge Management Systems, vol. 51 no. 3
Type: Research Article
ISSN: 2059-5891

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Article
Publication date: 17 October 2016

M. Muzamil Naqshbandi

The purpose of this paper is to develop and test an integrated model to examine the relationship between managerial ties and two types of open innovation (OI). It takes…

Abstract

Purpose

The purpose of this paper is to develop and test an integrated model to examine the relationship between managerial ties and two types of open innovation (OI). It takes into account the mediating role of realized absorptive capacity and explains how a firm’s ability to recognize the value of new information, assimilate it and apply it to commercial ends can facilitate OI.

Design/methodology/approach

Data were collected from 259 middle and top managers working across different sectors in the United Arab Emirates.

Findings

Results obtained using structural equation modeling show that managerial ties facilitate both in-bound and out-bound OI. Results also establish the mediating role of realized absorptive capacity in these relationships.

Research limitations/implications

Use of cross-sectional data as was done in this study has been criticized for being inappropriate to test causal models. Besides the findings may not be generalizable to different industries/cultures/regions.

Practical implications

This study suggests that managerial ties act to support OI in firms thus giving the insight that managers should be appreciated to build ties with managers of other firms, universities and government officials. Doing so can help firms achieve better OI outcomes. Firms should arrange means of interaction of their managers with these external knowledge sources such as events and occasions where managers of different firms can interact with each other to foster strong ties among them.

Originality/value

The above findings contribute theoretically to OI and managerial ties literature while providing insights for practitioners on how to succeed or avoid failure in their OI initiatives. These insights are novel and are new to the OI and managerial ties theory.

Details

Management Decision, vol. 54 no. 9
Type: Research Article
ISSN: 0025-1747

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Article
Publication date: 10 October 2018

Indu Ramachandran

The purpose of this paper is to introduce CEO succession (and subsequent TMT turnover) as a knowledge enabler. Focusing on absorptive capacity, an important dynamic…

Abstract

Purpose

The purpose of this paper is to introduce CEO succession (and subsequent TMT turnover) as a knowledge enabler. Focusing on absorptive capacity, an important dynamic capability involving the acquisition, assimilation, transformation and exploitation of knowledge, this paper highlights the role of a new CEO in emphasizing specific facets of the knowledge management (KM) process to fulfill expected strategic mandates.

Design/methodology/approach

This paper presents a conceptual framework that underscores the importance of CEO succession as a knowledge enabler by depicting its influence on the various dimensions of absorptive capacity. To this end, this paper develops an integrated set of propositions that unpack the influence of different types of CEO successions that trigger and enable different KM processes involved dimensions of absorptive capacity.

Findings

The theoretical framework presented in this paper suggests that given a certain succession context (forced or voluntary turnover of predecessor) different types of CEO succession, combined with possible executive turnover, will constitute a reorientation in top management experience and expertise. This will in turn trigger certain dimensions of absorptive capacity (potential or realized), to fulfill specific strategic mandates such as strategic change or strategic continuity.

Research limitations/implications

This paper presents a theoretical framework that underscores the importance of studying CEO succession in conjunction with their influence on different knowledge dimensions of absorptive capacity. CEO succession (and subsequent changes in top management team composition) is suggested to be a knowledge enabler. Based on the context of CEO turnover (forced vs voluntary) and the amount of change undergone in TMT composition, different types of CEO succession (based on their origin) are suggested to have different challenges to overcome and different strategic mandates to fulfill. Fulfilling these strategic mandates will require an emphasis on different facets of the KM process, which is encompassed in the dimensions of absorptive capacity. This will, in turn, resolve questions about which knowledge activities the organization needs to invest its resources in and resources allocation decisions may become easier.

Practical implications

Based on their origin, three kinds of CEO succession have been described in this paper – insider-follower, insider-contender and outsider succession. Each of these types of succession encounter different challenges and are expected to fulfill different kinds of strategic mandates. Accordingly, this paper proposes that each kind of CEO succession trigger and enable the knowledge components of absorptive capacity (knowledge acquisition, knowledge assimilation, knowledge transformation and knowledge exploitation) in different manners. This will in turn, allow firms to prioritize the allocation of resources toward different kinds of knowledge activities related to absorptive capacity.

Originality/value

This paper suggests that the CEO succession event, although broadly discussed in management research, has been overlooked when it comes to KM in organizations. Given that strategic leadership is one of the powerful enablers of organizational practices and outcomes, this paper emphasizes that different types of CEO succession may be able to influence the KM process by enabling the different dimensions of absorptive capacity (potential and realized).

Details

Journal of Knowledge Management, vol. 22 no. 8
Type: Research Article
ISSN: 1367-3270

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Article
Publication date: 15 January 2019

J. Muraliraj, S. Kuppusamy, Suhaiza Zailani and C. Santha

The purpose of this paper is to explore how Lean and Six Sigma’s distinctive practices relate to potential absorptive capacity (PACAP) and realized absorptive capacity

Abstract

Purpose

The purpose of this paper is to explore how Lean and Six Sigma’s distinctive practices relate to potential absorptive capacity (PACAP) and realized absorptive capacity (RACAP). The paper seeks to understand which of the practices in Lean Six Sigma are needed to manage absorptive capacity systematically.

Design/methodology/approach

Partial least square based structural equation modeling (PLS-SEM) was used to test the theoretical model drawing on a sample of 125 manufacturing organizations in Malaysia. In addition to examining direct effects, the study also examines indirect effects using bootstrapping method to identify possible mediation effects proposed in the model.

Findings

The results explain that Lean’s social practices (LSP), Six Sigma’s roles structure (RS) and structured improvement procedure (SIP) positively influence potential absorptive capacity (PACAP). Meanwhile LSP, RS and focus on metrics (FOM) positively influence realized absorptive capacity (RACAP). SIP was found to influence RACAP through PACAP. The analysis reveals the combination of Lean Six Sigma practices that are required in managing PACAP and RACAP differentially.

Research limitations/implications

The study is only confined to manufacturing industries in Peninsular Malaysia. Data collected were cross-sectional in nature. The application of Lean Six Sigma and how it influences absorptive capacity may get sturdier across time, and this may change the effect toward sustainability of firm’s competitive advantage. A longitudinal study may be useful in that context. The study also makes specific recommendations for future research.

Practical implications

The results of this study can be used by Lean Six Sigma practitioners to prioritize the implementation of Lean Six Sigma practices to develop absorptive capacity of the organization through PACAP and RACAP, which needs to be managed differentially as they exert differential outcomes. This would enable organizations to tactfully navigate and balance between PACAP and RACAP in accordance to business strategies and market conditions.

Originality/value

Absorptive capacity in Lean and Six Sigma context has largely been studied as a unidimensional construct or used as a grounding theoretical support. Therefore, understanding the multidimensionality through PACAP and RACAP provide insights on how to enhance and maneuver absorptive capacity through Lean Six Sigma systematically. The findings may pave the way for future research in enhancing the current knowledge threshold in Lean Six Sigma.

Details

International Journal of Lean Six Sigma, vol. 11 no. 1
Type: Research Article
ISSN: 2040-4166

Keywords

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