A Study on the Mediation Effects of the Types of Innovation on the Relationship between Absorptive Capacity and Business Performance

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.

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IS Integration and Business Performance: The Mediation Effect of Organizational Absorptive Capacity in SMEs

Journal of Information Technology ◽

10.1057/jit.2008.18 ◽

2008 ◽

Vol 23 (4) ◽

pp. 297-312 ◽

Cited By ~ 53

Author(s):

Chiara Francalanci ◽

Vincenzo Morabito

Keyword(s):

Organizational Change ◽

Absorptive Capacity ◽

Business Performance ◽

Small And Medium Enterprises ◽

Mediation Effect ◽

Fundamental Result ◽

Complex Technology ◽

Is Integration ◽

Medium Enterprises ◽

The Relationship

A fundamental result of the information technology (IT) and business performance literature is that IT is not a driver of performance per se. However, it can be associated with higher performance if accompanied by organizational change. The identification of the variables describing organizational change is still on-going work. This paper focuses on organizational absorptive capacity and analyses its effects on the relationship between IT and business performance in small and medium enterprises (SMEs). Organizational absorptive capacity measures the ability of an organization to complete a learning process. A significant learning effort is typically associated with IT, as it represents a complex technology. To cope with IT's complexity, implementation is typically incremental and is accompanied by a continuous integration effort of data and applications. The degree of integration of a company's information system (IS), called IS integration, is a proxy of IT maturity and quality. In this study, we explore the effect of IS integration on business performance through absorptive capacity, that is, we hypothesize that absorptive capacity has a mediation role between IS integration and business performance. The proposed research model is tested with data surveyed from 466 SMEs sited in Italy, for which exports constitute more than half of their revenues. Results indicate that organizational absorptive capacity has a mediation effect. Alternative models attributing to absorptive capacity a role different from mediation are found to be non-significant.

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Competitive intelligence and absorptive capacity for enhancing innovation performance of SMEs

Journal of Intelligence Studies in Business ◽

10.37380/jisib.v1i1.692 ◽

2021 ◽

Vol 1 (1) ◽

Author(s):

Abdeslam Hassani ◽

Elaine Mosconi

Keyword(s):

Economic Growth ◽

Absorptive Capacity ◽

Empirical Data ◽

Business Performance ◽

Innovation Performance ◽

Competitive Intelligence ◽

Theoretical Studies ◽

Complex Environments ◽

The Relationship

In dynamic and complex environments, it can be difficult for small and mediumsizedenterprises (SMEs) to achieve business performance, innovate and survive, even thoughthese actions are crucial for economic growth and competitiveness. Competitive intelligence (CI)appears as a strategic practice to help them. Although there are many theoretical studies thatpropose the relationship between CI and innovation, few studies have conducted empiricalstudies in the context of SMEs. The objective of this paper is to investigate how competitiveintelligence enhances innovation performance in the context of a SME. Based on a literaturereview and empirical data from several interviews with managers of one SME, our findingsallowed us to propose a framework showing the contribution of CI to innovation performancerelying on absorptive capacity. Our findings also highlight that a prospector owner-managercan improve the results of CI in the SME and contribute to better innovation performance.

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STRATEGIC FLEXIBILITY AND PERFORMANCE: EFFECTS OF POTENTIAL AND REALISED ABSORPTIVE CAPACITY

International Journal of Innovation Management ◽

10.1142/s1363919621500778 ◽

2021 ◽

pp. 2150077

Author(s):

RADOSLAW NOWAK

Keyword(s):

Absorptive Capacity ◽

Business Performance ◽

Innovation Management ◽

Past Research ◽

Two Dimensions ◽

Strategic Flexibility ◽

Performance Effects ◽

And Performance ◽

The Relationship

This study focuses on the relationship between strategic flexibility and absorptive capacity — past literature recognised the two constructs as critical in the context of a firm’s responsiveness to imminent exogenous changes. Consequently, the objective of this paper is to put forward a set of new hypotheses that empirically test the effects of two dimensions of absorptive capacity, potential and realised absorptive capacity, on strategic flexibility in the context of business performance. In this way, the study aims to contribute to past research on strategy and innovation management by explaining when strategic flexibility could lead to better performance.

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Managerial competencies and business performance: innovation as a mediator in Rwandan SMEs

International Journal of Law and Management ◽

10.1108/ijlma-09-2017-0217 ◽

2021 ◽

Vol ahead-of-print (ahead-of-print) ◽

Author(s):

Eugenie Byukusenge ◽

John C. Munene ◽

Laura A. Orobia

Keyword(s):

Business Performance ◽

Bootstrap Method ◽

Methodological Approach ◽

Business Environment ◽

Mediating Effect ◽

Cross Sectional ◽

Mediation Effects ◽

Content Type ◽

Managerial Competencies ◽

The Relationship

Purpose The purpose of this study is to examine the mediating effect of innovation on the relationship between managerial competencies and business performance of small and medium enterprises (SMEs) in Rwanda. Design/methodology/approach A cross-sectional survey and quantitative methodological approach were used to collect the data. The bootstrap method was used to test mediation effects. Findings The findings revealed that innovation is a significant mediator in the association between managerial competencies and business performance. This study, therefore, adds new knowledge by stating that innovation toward business performance is a partial mediator in the relationship between managerial competencies and business performance of SMEs in Rwanda. Research limitations/implications Only a single research methodological approach was used. Qualitative studies through interviews could be undertaken to triangulate. Furthermore, the findings from the present study are cross-sectional. Longitudinal studies ought to be undertaken to examine the mediation effects studied to investigate any possibility of variations in the results. Practical implications The results may help owners-managers of SMEs to develop policies and strategies that could enable them to take advantage of new opportunities in relation to updated technology and cope with changes that may take place in the business environment to boost their business performance level. Originality/value To the authors’ knowledge, no research has ever been carried out on the mediating role of innovation in the relationship between managerial competencies and business performance of SMEs in Rwanda.

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A Study on the Mechanisms Linking Environmental Dynamism to Innovation Performance

Sustainability ◽

10.3390/su12239999 ◽

2020 ◽

Vol 12 (23) ◽

pp. 9999

Author(s):

Eun-Hwa Seo ◽

Choo-Yeon Kim ◽

Kwangsoo Kim

Keyword(s):

Direct Effect ◽

Absorptive Capacity ◽

Innovation Performance ◽

Future Research ◽

Environmental Dynamism ◽

Research Directions ◽

Mediation Effects ◽

Research Findings ◽

Future Research Directions ◽

The Relationship

The purpose of our study is to examine the mechanisms that link environmental dynamism to firms’ innovation performance. Although there have been extensive studies on the effect of environmental dynamism on innovation performance, they have focused primarily on its direct effect and have resulted in rather inconsistent research findings. Thus, to explain the relationship between environmental dynamism and innovation performance more clearly, we intend to investigate the mechanisms through which environmental dynamism influences innovation performance in this study. Specifically, we aim to examine the mediation effects of strategic prospecting, absorptive capacity, and combined strategic prospecting–absorptive capacity on the relationship between environmental dynamism and innovation performance. Based on data collected from 266 small and medium-sized firms in Korea, our study has found that, assuming a causal interdependence between the mediators, both strategic prospecting and combined strategic prospecting–absorptive capacity mediate the relationship between environmental dynamism and innovation performance. It has also been found, however, that absorptive capacity alone does not mediate the relationship between environmental dynamism and innovation performance, while absorptive capacity mediates the relationship when it is linked to strategic prospecting. The results of our study further reveal that no direct effect of environmental dynamism on innovation performance exists, implying that the significant effect of environmental dynamism on innovation performance demonstrated in previous studies may be spurious in nature. Based on the findings, we present conclusions, theoretical and practical implications, and limitations with future research directions.

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MEMAHAMI KINERJA STARTUP : STUDI PADA STARTUP DI JAWA BARAT

AdBispreneur ◽

10.24198/adbispreneur.v5i3.30916 ◽

2021 ◽

Vol 5 (3) ◽

pp. 297

Author(s):

Sunu Puguh Hayu Triono ◽

Adryan Rachman

Keyword(s):

Absorptive Capacity ◽

Business Intelligence ◽

Entrepreneurial Orientation ◽

Business Performance ◽

Dynamic Capabilities ◽

Positive Association ◽

Data Utilization ◽

Innovation Activities ◽

Use Of Data ◽

The Relationship

One characteristics of startups compared to conventional MSMEs is the use of data. Utilization of data starts from business intelligence & analytics. The knowledge generated together with other dynamic capabilities will support each other in creating value to improve startup business performance. The purpose of this study was to determine the relationship between business intelligence & analytics, absorptive capacity, innovation ambiance, and entrepreneurial orientation towards startup business performance.Data obtained by survey distributed by email to 194 startups in West Java. PLS-SEM was used to estimate model in this study. We propose and test a model that integrates the domains of dynamic capability, knowledge management, and entrepreneurship. The main findings show that the use of BI&A has a positive association with the ability to balance competitive innovation activities, supported by entrepreneurial orientation, in turn improving startup performance.This study integrates insights gained from the application of IT value creation and dynamic capabilities perspectives to explain how the use of BI&A is associated with the ambidexterity of innovation and business performance and through entrepreneurial orientation. Salah satu ciri startup dibandingkan UMKM konvensional adalah penggunaan data. Pemanfaatan data dimulai dari business intelligence & analytics. Pengetahuan yang dihasilkan bersama dengan kapabilitas dinamis lainnya akan saling mendukung dalam menciptakan nilai guna meningkatkan kinerja bisnis startup. Tujuan dari penelitian ini adalah untuk mengetahui hubungan antara business intelligence & analytics, absorptive capacity, innovation ambidexterity, dan entrepreneurial orientation terhadap kinerja bisnis startup. Data didapatkan dari survei yang disebarkan melalui email kepada 194 startup di Jawa Barat. PLS-SEM digunakan untuk mengestimasi model dalam penelitian ini. Kami menguji model yang mengintegrasikan domain dynamic capabilities, manajemen pengetahuan, dan kewirausahaan. Temuan utama menunjukkan bahwa penggunaan BI&A memiliki hubungan positif dengan kemampuan mengimbangi aktivitas inovasi kompetitif, didukung oleh orientasi kewirausahaan, yang pada gilirannya meningkatkan kinerja startup. Studi ini mengintegrasikan wawasan yang diperoleh dari penerapan perspektif penciptaan nilai TI dan kapabilitas dinamis untuk menjelaskan bagaimana penggunaan BI&A dikaitkan dengan innovation ambidexterity dan kinerja bisnis dan melalui orientasi kewirausahaan.

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INNOVATION CAPABILITY, ABSORPTIVE CAPACITY AND SMES PERFORMANCE IN PAKISTAN: THE MODERATING EFFECT OF BUSINESS STRATEGY

Journal of Technology and Operations Management ◽

10.32890/jtom2018.13.2.1 ◽

2018 ◽

Vol 13 (Number 2) ◽

pp. 1-11

Author(s):

Muhammad Zulqarnain Arshad ◽

Darwina Arshad

Keyword(s):

Economic Growth ◽

Absorptive Capacity ◽

Business Strategy ◽

Innovation Capability ◽

Research Directions ◽

Conceptual Paper ◽

And Performance ◽

New Research ◽

The Relationship ◽

Crucial Part

The small and medium-sized enterprises (SMEs) play a crucial part in county’s economic growth and a key contributor in country’s GDP. In Pakistan SMEs hold about 90 percent of the total businesses. The performance of SMEs depends upon many factors. The main aim for the research is to examine the relationship between Innovation Capability, Absorptive Capacity and Performance of SMEs in Pakistan. This conceptual paper also extends to the vague revelation on Business Strategy in which act as a moderator between Innovation Capability, Absorptive Capacity and SMEs Performance. Conclusively, this study proposes a new research directions and hypotheses development to examine the relationship among the variables in Pakistan’s SMEs context.

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