Absorbing the Concept of Absorptive Capacity
Organization Science
V ol.21,No.4,July–August2010,pp.931–951 issn1047-7039 eissn1526-5455 10 2104 0931
inf orms
?doi10.1287/orsc.1090.0503
?2010
INFORMS
Absorbing the Concept of Absorptive Capacity:How to Realize Its Potential in the Organization Field
Henk W.V olberda
Department of Strategic Management and Business Environment,Rotterdam School of Management,Erasmus University,and INSCOPE:Research for Innovation,3000DR Rotterdam,The Netherlands,hvolberda@rsm.nl
Nicolai J.Foss
Department of Strategy and Management,Norwegian School of Economics and Business Administration,
N-5045Bergen,Norway,and Center for Strategic Management and Globalization,
Copenhagen Business School,2000Frederiksberg,Denmark,njf.smg@cbs.dk
Marjorie A.Lyles
Kelley School of Business,Indiana University,Indianapolis,Indiana46202,mlyles@https://www.wendangku.net/doc/cf14611892.html,
T he purpose of this perspective paper is to advance understanding of absorptive capacity,its underlying dimensions, its multilevel antecedents,its impact on?rm performance,and the contextual factors that affect absorptive capacity. Twenty years after the Cohen and Levinthal1990paper,the?eld is characterized by a wide array of theoretical perspectives
and a wealth of empirical evidence.In this paper,we?rst review these underlying theories and empirical studies of absorptive capacity.Given the size and diversity of the absorptive capacity literature,we subsequently map the existing terrain of research through a bibliometric analysis.The resulting bibliometric cartography shows the major discrepancies
in the organization?eld,namely that(1)most attention so far has been focused on the tangible outcomes of absorptive capacity;(2)organizational design and individual level antecedents have been relatively neglected in the absorptive capacity literature;and(3)the emergence of absorptive capacity from the actions and interactions of individual,organizational,and interorganizational antecedents remains unclear.Building on the bibliometric analysis,we develop an integrative model that identi?es the multilevel antecedents,process dimensions,and outcomes of absorptive capacity as well as the contextual factors that affect absorptive capacity.We argue that realizing the potential of the absorptive capacity concept requires more research that shows how“micro-antecedents”and“macro-antecedents”in?uence future outcomes such as competitive advantage,innovation,and?rm performance.In particular,we identify conceptual gaps that may guide future research
to fully exploit the absorptive capacity concept in the organization?eld and to explore future fruitful extensions of the concept.
Key words:absorptive capacity;knowledge management;organizational capabilities;multiple analytical levels;
microfoundations of absorptive capacity
History:Published online in Articles in Advance March11,2010.
Introduction
During the last two decades it has become almost axiomatic that knowledge lies at the core of the creation and maintenance of competitive advantage(McEvily and Chakravarthy2002,Grant1996a).In particular, the ability to innovate has become increasingly central as studies have revealed that innovative?rms tend to demonstrate higher pro?tability,greater market value,
superior credit ratings,and higher survival probabilities (Geroski et al.1993,Hall2000,Czarnitzki and Kraft 2004).Firms increasingly build innovation capacity by tapping into external knowledge sources(Chesbrough 2003,Laursen and Salter2006).At the same time,it is widely accepted that critical knowledge is not always easily available through external sources(Argote1999), which fosters a need for creating knowledge internally 931
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(Nonaka1994).However,with respect to both modes of knowledge sourcing,the capacity to absorb knowledge has become crucial.
In their seminal papers,Cohen and Levinthal de?ne absorptive capacity(henceforth,“AC”)as the“ability to identify,assimilate,and exploit knowledge from the environment”(1989,p.589;1990;1994).The increasing number of publications that apply,measure,or extend their concept of AC de?nitely re?ects the high absorp-tion of the relatively new AC notion in the organiza-tion?eld.Scholars have“recognized”the richness of the concept and“assimilated”the concept through renewing theories,developing conceptual models,and conduct-ing various empirical studies.However,there are serious doubts about the exploitation of the concept to its full potential in the organization?eld.Van den Bosch et al. (2003)classify AC as a potentially powerful multilevel and transdisciplinary construct,but they identify a huge gap between the speed of proliferation of theoretical and empirical contributions and the speed of accumula-tion of the acquired scienti?c knowledge of https://www.wendangku.net/doc/cf14611892.html,ne et al.(2006)even conclude that the AC construct has become rei?ed—the construct is taken for granted,and researchers fail to specify the underlying assumptions—with devastating effects on the validity of studies that use the AC concept.
How can we fully exploit the AC concept and explore future fruitful extensions of the concept?In this perspec-tive paper,we?rst study the roots of absorptive capac-ity by systematizing its underlying theories.What have prior AC studies in the organization?eld brought us? Research on AC spans theories of learning,innovation, managerial cognition,the knowledge-based view of the ?rm,dynamic capabilities,and coevolutionary theories. This diversity in theories and empirical methods has con-tributed to the rapid advance of the emerging AC?eld by cultivating the simultaneous development of special-ized areas of inquiry that investigate different dimen-sions,antecedents,levels of analysis,and outcomes of AC and contextual factors that affect AC. However,without addressing the questions of integra-tion,the organization?eld runs the risk of propagating a highly fractioned view of AC(Argote et al.2003). Are there points of convergence in the AC?eld?Are these theories and empirical studies investigating unre-lated aspects of AC or are they treading the same ground? Given the size and diversity of the AC literature,we will map the existing terrain of research in AC on the basis of a comprehensive bibliometric analysis.By identifying the relevant domains in the AC?eld that attract most pub-lications and their speci?c growth rates,we provide a?rst overview of the?eld and predict its further development. It mainly shows that key antecedents to absorptive capac-ity itself have not received much attention,in particu-lar intraorganizational antecedents.Moreover,studies on the exploitation of knowledge from the environment and intangible outcomes are underrepresented in the?eld. Cohen and Levinthal(1990),and virtually all of the sub-sequent AC literature,essentially argue that AC is mainly dependent on?rms’prior knowledge endowments,which in turn are dependent on earlier AC.On the basis of the insights of our literature review and bibliometric carto-graphy,we argue that AC has an important,but hitherto neglected,set of distinctly organizational antecedents, such as organizational structure,reward systems,and systems of human resources management(HRM)prac-tices and policies.Although Cohen and Levinthal(1990) explicitly point out that aspects that are“distinctly orga-nizational”shape a?rm’s AC beyond the sum of employ-ees’individual absorptive capacities,they do not treat this idea in much detail,and understanding of such orga-nizational antecedents of AC remains limited.Moreover, there may be antecedents of AC that are placed at the level of individuals.These antecedents have been sim-ilarly neglected in the literature,and because of this we have little knowledge of the effect of,for example, personnel turnover on AC and key individuals’impact on AC.
On the basis of the outcomes of the bibliometric anal-ysis,we propose an integrative framework that high-lights the underlying dimensions of AC,its multilevel antecedents,the contextual factors that affect AC,and the outcomes of AC.The framework identi?es common areas of research that should be further developed in the organization?eld.In particular,we provide some directions for further research on the boundaries of the construct,its individual and organizational level antecedents,inward and outward-looking dimensions, and costs aspects.With more research efforts in these so-called microfoundations of AC,managers can use their knowledge of organizational antecedents to in?u-ence future outcomes such as competitive advantage, innovation,and?rm performance.
Absorptive Capacity in Organizational Theories:A Review
In their study on international technology transfer,1 Kedia and Bhagat(1988)?rst coined the term“absorp-tive capacity.”However,the contribution by Cohen and Levinthal(1990)is generally accepted as the founding paper.It de?ned AC as“the ability of a?rm to recog-nize the value of new,external information,assimilate it, and apply it to commercial ends”(Cohen and Levinthal 1990,p.128).This seminal paper had received until2005 more than1,300citations,and during that period more than600papers were published incorporating the con-cept of AC in ISI journals.Cohen and Levinthal(1989, 1990)put R&D at the center of?rms’innovative pro-cesses by linking it to both learning and innovation.In doing so,they positioned AC as a key concept in the literature and laid the groundwork for theoretical devel-opments over the subsequent20years,as summarized
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in Table1.2However,the AC theme overlaps with other themes and?elds,such as cognition,knowledge,and dynamic capabilities.Moreover,the theoretical develop-ment of AC ranges from the psychological emphasis on cognition and learning,to the economic perspective on innovation and competition,to the sociological orienta-tion towards coevolution.In this section,we brie?y dis-cuss how various streams in the organization?eld are related to AC,in some cases even partially anticipating it. Learning.The roots of AC are found in the organi-zational learning literature of the1980s.Fiol and Lyles (1985)and Levitt and March(1988)discuss the role of R&D in organizational learning and performance,and Kedia and Bhagat(1988)address the role of organiza-tional characteristics in technology transfer.In line with Cohen and Levinthal(1990),these early articles strongly link AC to learning,innovation,and performance of ?rms.
Cohen and Levinthal(1990,p.135)also posit that dis-tinct organizational mechanisms can in?uence the level of AC—mechanisms such as the transfer of knowledge across and within units,the structure of communica-tion between the external environment and the?rm(i.e., the centralization of the interface function),a broad and active network of internal and external relation-ships,and cross-function interfaces(Van den Bosch et al. 1999).However,their main argument is that the learn-ing potential for AC is primarily determined by prior related knowledge and R&D investments,labeled as the “cumulativeness feature”by Cohen and Levinthal.Many empirical studies support this(recursive)notion of AC (Ahuja2000,Cockburn and Henderson1998,Lane and Lubatkin1998,Lyles and Salk1996,Mowery et al.1996, Pennings and Harianto1992,Pisano1994,Powell et al. 1996,Shane2000,Stuart1998,Tsai2001).Furthermore, Reagans and McEvily(2003,p.243)support the con-cept of knowledge accumulation by showing that people absorb knowledge more easily when they already have some common knowledge in terms of expertise,training, or background characteristics.
However,some subsequent work looks at AC in an interorganizational context(Lane and Lubatkin1998, Lane et al.2001,Benson and Ziedonis2009).When knowledge is shared or transferred between?rms,R&D is less relevant than the similarity between the?rms. Lane and Lubatkin(1998)coin the term“relative absorp-tive capacity”to describe the phenomenon that?rms have various levels of AC and that it is a relative https://www.wendangku.net/doc/cf14611892.html,ne et al.(2001)develop measures for the three processes within AC of recognition,assimi-lation,and utilization.The empirical analysis indicates that recognition and assimilation have an impact on the knowledge acquired,and utilization has a direct positive link to?rm performance.
Innovation.Insights from the innovation literature, which grows out of both the management and the economics literatures,clearly play an important role in Cohen and Levinthal’s(1989)prelude to AC.The primary conclusion of that paper is that although invest-ments in R&D are clearly aimed at generating innova-tions and also ful?ll this task,an important by-product is the expansion of?rms’“capabilities to assimilate and exploit externally available information”(Cohen and Levinthal1989,p.593).In line with this,Feinberg and Gupta(2004)study the role of knowledge spillovers in R&D location choice by MNCs and suggest that MNCs anticipate knowledge spillovers from their com-petition when they make decisions about R&D respon-sibilities abroad.They?nd that“ the MNCs view the assignment of R&D responsibilities to a subsidiary as an investment in the subsidiary’s capacity not only to create new technical knowledge but also to absorb spillovers of external knowledge from competitors”(2004,p.842). Although modi?ed to a de?nition with three com-ponents(recognition,assimilation,and exploitation)in their1990paper and further expanded by Zahra and George(2002)into four(acquisition,assimilation,trans-formation,and exploitation),the groundwork for the AC concept was laid in Cohen and Levinthal’s1989 paper.In their1990paper,Cohen and Levinthal not only include recognition of knowledge but also link AC more strongly to R&D,innovation,and learning.Moreover, Cockburn and Henderson(1998)included organizational antecedents in the context of pharmaceutical research and further broadened the innovation perspective on AC. They found that AC is related to?rms’internal organi-zation as well as to their performance in drug discovery. Managerial Cognition.Theory on managerial cogni-tion suggests that managers perceive things through their own cognitive lenses.Thus managers can be considered “cognizers”(Calori et al.1994)who reduce the com-plexity they face by developing mental maps that result in a“dominant management logic”(Prahalad and Bettis 1986,Bettis and Prahalad1995).This dominant logic evolves over time,directly in?uencing the organizational form(Dijksterhuis et al.1999)and indirectly the level of AC(Van den Bosch et al.1999).For example,managers applying a classical management logic(Dijksterhuis et al. 1999,p.572;V olberda1998)favor traditional functional organizational forms and do not consider the environ-ment as a source of valuable knowledge to be absorbed (Van den Bosch et al.1999,p.560).In such a classi-cal management logic,managers portray organizations as tools designed to achieve preset ends and ignore or min-imize the perturbations and opportunities posed by con-nections to a wider environment(Scott1987).Therefore, these managers will seriously limit the level of absorptive capacity of the?rm.Lenox and King(2004)show that managers can however directly affect a?rm’s absorptive
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Table1Theories Informing Absorptive Capacity:Contributions,Constructs,and Implications
Theories Main contributions AC-related constructs Implications
Learning Fiol and Lyles(1985)
Levitt and March(1988)
Cohen and Levinthal(1989,1990)
Lyles and Salk(1996)
Lane and Lubatkin(1998)
Lane et al.(2001)
Reagans and McEvily(2003)
Dhanaraj et al.(2004)
Lane et al.(2006)Organizational learning is based on
direct experience and routines,
history-dependent and target-oriented,
and in?uenced by contextual factors.
Prior related knowledge is the most
important antecedent of AC.
Relative AC is more relevant for
interorganizational learning than
R&D-based AC.
?AC consists of three dimensions:
recognition,assimilation,and exploitation.
?(Inter)organizational context matters for AC.
?Levels of analysis:individuals,
organizations,dyads,and networks.
Innovation Kedia and Bhagat(1988)
Cohen and Levinthal(1989,1990)
Cockburn and Henderson(1998)
Feinberg and Gupta(2004)
Rothaermel and Alexandre(2009)
Benson and Ziedonis(2009)The in?uence of technological opportunity
and appropriability regimes on
innovation is mediated by AC.
R&D and AC interact to increase a?rm’s
knowledge base and innovation.
There is more to AC than just R&D;
several(inter)organizational
characteristics play a key role.
?AC in?uences innovative performance.
?AC as by-product of R&D.
?Cultural differences between countries
affect AC.
?(Inter)organizational context matters for AC.
Managerial Bettis and Prahalad(1986,1995) cognition Lyles and Schwenk(1992)
Calori et al.(1994)
Dijksterhuis et al.(1999)
Van den Bosch and Van Wijk(2001)
Sanchez(2001)
Lenox and King(2004)
Minbaeva et al.(2003)Complexity tends to be resolved by a
dominant logic.
More diversity in a?rm’s activities
increases the comprehensiveness and
complexity of the CEO’s mental map of
the environment.
Management logics greatly in?uence a
?rm’s actions in the competitive
landscape as well as the emergence
of new organizational forms.
Providing information by managers as
well as individuals’abilities and
motivations enhances AC.
?Management logics,through organizational
forms,in?uence absorptive capacity,
especially in complex environments.
?Managers can develop AC by directly
providing information.
?Individuals’abilities as well as their
motivations enhance AC.
Knowledge-based Kogut and Zander(1992) view of the?rm Starbuck(1992)
Garud and Nayyar(1994)
Grant(1996a,b)
Van den Bosch et al.(1999)
Van Wijk et al.(2003)
Foss and Pedersen(2004)
Andersen and Foss(2005)
Malhotra et al.(2005)
Matusik and Heeley(2005)Combinative capabilities play a key role
in leveraging organizational
knowledge.
The knowledge characteristics of the
environment in?uence the
characteristics of the knowledge
absorption by the?rm.
Organizational form determines the
characteristics of AC.
Network properties in?uence the level
of AC.
?High AC increases the amount and
productivity of knowledge.
?Combinative capabilities,organizational
form,and knowledge characteristics all
in?uence the?rm’s AC.
?AC is particularly relevant when knowledge
is shared.
Dynamic Cohen and Levinthal(1994) capabilities Grant(1996b)
Van den Bosch et al.(1999)
Floyd and Lane(2000)
Zahra and George(2002)
Jansen et al.(2005)
Lichtenthaler(2009)AC is a capability and thus requires
investments.
AC,being itself a high level capability,is
also the result of lower level
organizational or combinative
capabilities.
Potential and realized AC(PAC and RAC)
can be broken down into knowledge
acquisition,assimilation,
transformation,and exploitation
capabilities.
?AC is a high level capability,supported by
other capabilities.
?PAC consists of knowledge acquisition and
assimilation capabilities and is increased
by coordination capabilities.
?RAC consists of knowledge transformation
and exploitation capabilities and is
increased by systems and socialization
capabilities.
Coevolution Cohen and Levinthal(1994,1997)
Koza and Lewin(1999)
Lewin et al.(1999)
Lewin and Volberda(1999)
Van den Bosch et al.(1999)
Huygens et al.(2001)
Volberda and Lewin(2003)Macro-coevolutionary effects:Knowledge
environments coevolve with the
emergence of organizational forms
and combinative capabilities that are
suitable for absorbing knowledge.
Micro-coevolutionary effects:Increasing
levels of AC lead to more readily
accumulating additional knowledge in
subsequent periods.Higher levels of
AC raise the aspiration level and
increase the level of exploration
adaptation.
?AC enables or restricts?rm adaptation.
?AC coevolves with the knowledge
environment.
?Levels and direction of AC are shaped by
the joint effect of managerial actions and
developments in the knowledge
environment.
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capacity for a new practice by providing information to potential adopters in the organization.The effectiveness of these managerial actions is contingent on the degree to which other sources of information are available to individuals.Previous adopters and past events seem to dampen the effect of central information,whereas related experiences seem to amplify it.Minbaeva et al.(2003) emphasize the importance of individuals’ability(educa-tion and skills)as well their motivation to absorb external knowledge.As managers continuously develop theories about the world around them and embed them in their dominant logic(Sanchez2001),?rm AC will be strongly in?uenced by cognitive processes on the managerial level (Eggers and Kaplan2009).This is consistent with Van den Bosch and Van Wijk’s(2001)plea to recognize the strong effect managers can have on knowledge-related processes in organizations.
Knowledge-Based View of the Firm.Starting with Kogut and Zander(1992),the knowledge-based view considers knowledge to be the most important resource of the?rm and the main determinant of competitive advantage.This view strongly in?uences the relevance of the AC construct because AC is key to developing and increasing a?rm’s knowledge base.In the particular case of knowledge-intensive?rms,learning at the orga-nizational and individual level is of prime importance (Starbuck1992).Thus AC involves individuals,groups, and organizational levels.Individuals are involved in the knowledge sharing and recognition aspects;at the organi-zational level,routines,histories and stories,documenta-tion,procedures,heuristics,and know-how are important in creating shared understandings of the knowledge at the ?rm level(Grant1996b,Matusik and Heeley2005). Knowledge stocks and?ows are also constructs that are related to the recognition,assimilation,and utilization of new knowledge(Foss2006).A number of researchers have used“knowledge stock”concepts and measures to access?rm level AC.For example,Nicholls-Nixon (1993)examines AC in the pharmaceutical industry by using the number of patents,number of new products, and the?rm’s reputation as measures of AC.Those with higher levels of AC utilized more alliances and had more in-house expertise than those with lower levels. Knowledge?ows involve the transfer of knowledge to the receiver.Theorists suggest that the AC of sender and receiver,the past experiences,and the degree of related knowledge are some of the most important fac-tors in?uencing the success of knowledge transfer.Thus Cohen and Levinthal(1990)point out that learning is dependent on the degree of knowledge overlap between two parties(see also Lane and Lubatkin1998).Using patent data,Rosenkopf and Almeida(2003)show a ten-dency for?rms to search locally for new knowledge (see also David1975,Nelson and Winter1982,Stiglitz 1987).Local knowledge can be“more easily recognized and managed by the organization’s existing routines and members”(Rosenkopf and Almeida2003,p.753).At the same time,they propose that connections between ?rms in dissimilar contexts may present more novel and nonredundant knowledge.Knowledge is more likely to be transferred between people with similar training and https://www.wendangku.net/doc/cf14611892.html,ne and Lubatkin(1998)suggest that those?rms with basic scienti?c-knowledge similarities with their partners report more learning.They shift the emphasis to a dyad,with one?rm learning from another: one may be the teacher and the other the student.They use a sample of R&D alliances between pharmaceutical and biotechnology companies to test whether similarities in organizational practices and in knowledge in?uence the ability to absorb new knowledge.Their main conclu-sions are that the AC of the student?rm is as important as the AC of the teacher?rm and that organizational antecedents are important.
Van den Bosch et al.(1999)emphasize that the characteristics of a?rm’s AC relate to the nature of the knowledge in its environment.They support Cohen and Levinthal’s notion(1990,p.149)that“[a]bsorptive capacity is more likely to be developed and maintained as a byproduct of routine activity when the knowledge domain that the?rm wishes to exploit is closely related to its current knowledge base.”However,they show that knowledge embedded in the organizational form(Grant 1996b)as well as the?rm’s combinative capabilities (Kogut and Zander1992)in?uence a?rm’s AC.Not only limitations in a?rm’s current knowledge base but also the rigidity of organization forms and the combi-native capabilities to synthesize and apply current and acquired knowledge may generate inertia in adapting AC. Van Wijk et al.(2003)and Malhotra et al.(2005)show that interorganizational networks and supply chains can be rewarding for?rms to gain access to knowledge,to facilitate learning processes,and to foster knowledge cre-ation.Furthermore,from an internal network perspective, Andersen and Foss(2005)?nd that the development of strategic opportunities is increased by internal commu-nication between business units,establishing clearly the relevance of knowledge transfer and AC within multiunit ?rms.
Dynamic Capabilities.Dynamic capabilities represent the?rm’s latent abilities to renew,augment,and adapt its core competence over time(Teece et al.1997,Teece 2007,Augier and Teece2009).In their1990paper, Cohen and Levinthal point out that“ an organiza-tion’s absorptive capacity is not resident in any sin-gle individual but depends on the link across a mosaic of individual capabilities”(Cohen and Levinthal1990, p.133).In their1994article,they argued that sustaining this capability over time requires investments but results in the ability to not only“exploit new,valuable devel-opments,but also to envision better their emergence”
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(Cohen and Levinthal1994,p.244).Extending this dynamic nature further,Zahra and George(2002)intro-duce a“dynamic capabilities”perspective of AC and distinguish among four dimensions of AC that constitute potential and realized AC.The distinction highlights the separate but complementary roles of both subsets of AC. Firms focusing on acquisition and assimilation of new external knowledge are able to continuously renew their knowledge stock(potential AC),but they may suffer from the costs of acquisition without gaining the bene-?ts of exploitation.Conversely,?rms focusing on trans-formation and exploitation(realized AC)may achieve short-term pro?ts through exploitation but fall into a competence trap.Todorova and Durisin(2007)provide a review of Zahra and George’s(2002)reconceptual-ization of AC and suggest that Cohen and Levinthal’s (1990)model provides important implications left out in Zahra and George’s model.They identify impor-tant antecedents such as social integration,appropriabil-ity regimes,feedback loops,and power relationships. Moreover,they suggest to go back to the component capabilities(recognition,acquisition,assimilation or transformation depending on the current cognitive frame of reference,and exploitation)instead of the subsets of potential and realized AC.Jansen et al.(2005)pro-vide evidence of the distinct effects of organizational antecedents on the components of AC.They show in an empirical study within a multiunit?rm that coordination capabilities,such as“cross-functional interfaces,par-ticipation in decision-making,and job rotation,”(2005, p.999)enhance potential AC;whereas systems capabili-ties such as“formalization”and socialization capabilities such as“connectedness and socialization tactics”(2005, p.999)strengthen realized AC at the business unit level. Coevolution.According to coevolutionary theory,?rm change is the joint effect of managerial intentionality and institutional and environmental effects(Lewin and V olberda1999,V olberda and Lewin2003).Many coevo-lutionary studies suggest that AC enables or restricts the level and range of exploration adaptations(Cohen and Levinthal1990,1994,1997;Lewin et al.1999).For instance,Cohen and Levinthal suggest that?rms can ben-e?t from investing in AC to preempt changes in the envi-ronment(1994,p.244).Furthermore,Lewin et al.(1999) take AC to mediate the relationships between managerial action,competitive dynamics,and the institutional envi-ronment as well as the relationship between exploration, exploitation,?rm-speci?c history,and wealth creation (1999,pp.536–537).Moreover,Van den Bosch et al. (1999)study the coevolution of a?rm’s path-dependent AC and the knowledge environment.They show vari-ous coevolutionary effects,such as the higher AC,the more likely a?rm’s expectation formation will be de?ned in terms of the opportunities present in its environment, independent of current performance criteria.All in all,coevolutionary theories implicitly or explicitly build on Cohen and Levinthal’s(1990)concept of AC,if only because they integrate the other theoretical streams dis-cussed above(V olberda et al.2001).The theories’main argument is that a?rm’s level of AC is the joint outcome of managerial actions and developments in the knowl-edge environment.
Our theory overview clearly shows that the concept of AC has been resonating in various organization the-ories.Although most of the underlying studies are still ?rmly embodied in the themes of organizational learn-ing and innovation and the de?nitions developed by Cohen and Levinthal(1989,1990,1994),AC research has also addressed knowledge characteristics,managerial cognition,capability development,organizational struc-ture,and scope as well as interorganizational learning in the contexts of dyads and networks.The heterogeneity of AC research is for sure an indication of the richness of the construct.However,it also raises important questions about the degree of integration across theories and the extent to which a truly cumulative body of knowledge is emerging.In the next section,we investigate to what extent the AC concept has been absorbed in empirical studies.
Absorptive Capacity in Empirical Studies Empirical studies,using different methods(surveys, archival data,case studies)and studying different con-texts(?rms,joint ventures,different industries),are increasing our understanding of AC.The reliance on different theoretical perspectives,different empirical methods,and different empirical contexts of AC helps establish the extent to which?ndings generalize and to identify the boundary conditions under which they apply. Although our intent is not to identify all of the empirical research that is directly or tangentially related to AC,a few observations regarding the empirical work done to date are in order.
Static Approach.In these empirical studies,AC is typ-ically viewed as a?rm level concept that captures the evolution of learning and utilization of new knowledge that accumulates over time.They reinforce Cohen and Levinthal’s de?nition indicating that AC is developmen-tal,lagged,and path-dependent.However,we?nd that very few published empirical studies of AC fully capture the developmental,lagged,and path-dependent charac-teristics of AC.Despite the lack of research on these char-acteristics of AC,most authors continue to frame their arguments in a very static way.Their analytical mod-els do not take into account time and feedback loops (cf.Todorova and Durisin2007,Van den Bosch et al. 1999).The study of AC in a dynamic way requires the use of longitudinal research methods and process models, which allow investigating the pace and paths of change. Some studies do capture some portion of these char-acteristics.Feinberg and Gupta(2004)use large-scale
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panel data over a seven-year period to study R&D sub-sidiaries of MNCs and their assignment of new R&D units.Lenox and King(2004)use independent variables such as Past Events and Related Practices and?nd that past experience may in?uence the recognition and use of new https://www.wendangku.net/doc/cf14611892.html,ne et al.(2001)are able to use two time periods and to use a variable showing prior knowledge learned and the impact on current utilization of new knowledge.In our view,these studies do capture the characteristics but still leave room for many other factors that affect the AC of?rms,including organiza-tional factors that can be in?uenced through managerial choice.We do need more dynamic models that incor-porate variables addressing managerial intentionality to in?uence the level of AC(Van den Bosch et al.2003). Little is also known about how knowledge is stored and retrieved from the organizational memory and how this varies over time.
Indirect Measures.Measures of AC have been rudi-mentary and do not fully re?ect the richness of the con-struct.The majority of AC empirical studies use proxies (such as R&D expenditures or the number of scien-tists working in R&D departments)rather than direct measures of the construct(cf.Zahra and George2002, Minbaeva et al.2003,Lichtenthaler2009).Archival data proxies are attractive in research,as they can often be obtained more ef?ciently than direct measures.How-ever,they may provide less accurate representations.As Mowery et al.(1996,p.82)point out,“R&D intensity measures inputs to the creation of capabilities and indi-cates little if anything about resultant change in capa-bilities.”Lane and Lubatkin(1998)and more recently Lichtenthaler(2009)provide empirical evidence about the relatively low explanatory power of R&D spending in comparison to the explanatory power of various dimen-sions of AC.Furthermore,linkage to the dynamic nature of capabilities is missing.
Absorptive Capacity as Independent Variable. Although Cohen and Levinthal(1990)use R&D spend-ing as a?rm level proxy for AC,they suggest that there are organizational mechanisms that in?uence AC,such as the transfer of knowledge,centralization, internal networks,and cross-functional interfaces. Most empirical studies,however,consider AC as an independent variable.Few studies have broken AC down into its components and measured elements of recognition,assimilation,and utilization separately,with the exception of Lane et al.(2001),Jansen et al.(2005), and Lichtenthaler(2009).
One Level of Analysis.AC is a multilevel construct and should be studied at the individual,unit,?rm,and inter?rm level of analysis.As Cohen and Levinthal (1990,p.128)point out,“Outside sources of knowl-edge are often critical to the innovation process,what-ever the organizational level at which the innovating unit is de?ned.”Of these levels of analysis,the majority of empirical studies on AC address either the business unit level(cf.Tsai2001)or the subsidiary level(cf.Gupta and Govindarajan2000).
Unidimensional Operationalizations.Furthermore, few studies have truly assessed the multidimensional nature of AC.Most empirical studies focus primarily on prior related knowledge and ignore various internal mechanisms that can in?uence a?rm’s level of AC,such as the structure of communication and the character and distribution of expertise and knowledge within the organization.Multidimensional characterizations of AC are important because they can explain more variance. An exception is Van den Bosch et al.(1999),who on the basis of case studies?nd that organizational forms and combinative capabilities are internal mechanisms to raise levels of AC.Moreover,they suggest that AC may be affected by the internal organization structure and that different divisions/units may be able to absorb different kinds of knowledge but also may have different capabilities for transferring that knowledge internally. In addition,Jansen et al.(2005)show on the basis of a survey in a large multiunit?rm how various organizational mechanisms associated with coordination capabilities(cross-functional interfaces,participation in decision making,job rotation),systems capabilities (formalization,routinization),and socialization capabil-ities(connectedness,socialization tactics)impact AC differently.
Ignorance of Process Dimensions.It is clear that most empirical studies do not carefully address impor-tant processes that in?uence the viability of AC constructs.For example,organizational memory is important because past knowledge is seen as the basis for new knowledge.But how knowledge is stored and retrieved is not addressed(Lyles and Schwenk1992),nor is the question how long lived is the stored knowledge. The concept of knowledge stock is not fully addressed in most studies and is often measured by the number of patents a company holds(Rosenkopf and Almeida2003). Furthermore,many aspects of the learning processes are presented but not fully utilized by empirical researchers as aspects of AC.For example,additional work can be done on creativity,innovation,improvisation,and chunk-ing of knowledge.
Although empirical studies in AC show serious short-comings,they certainly contributed to the rapid advance of the emerging AC?eld by investigating different dimensions,antecedents,levels of analysis,and out-comes of AC as well as contextual factors that affect AC.In the remainder of this article,we assess the state of integration of knowledge accumulated across the different theoretical perspectives and empirical studies (Argote et al.2003).Are there points of convergence in the AC?eld?We also address what we see as the primary research gaps.
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Figure1Bibliometric Map of the Field of Absorptive Capacity
A Bibliometric Analysis of Absorptive Capacity
So far we have provided a comprehensive review of underlying theories and the most essential empirical studies of AC.Do we see stable and consistent?ndings from one discipline that are replicated and reinforced by?ndings from other disciplines?Are researchers from different disciplines investigating unrelated aspects of AC or are they treading the same ground?What are the current themes emerging from AC research?Given the size and diversity of the AC literature,we conducted a comprehensive bibliometric analysis of the AC concept in the organizational literature.In every scienti?c?eld, key concepts set the base for theoretical developments through the years.The object of our bibliometric study is to analyze the in?uence of the introduction of the AC concept on the research?eld through the analysis of sci-enti?c publications.By mapping the existing terrain of research in AC,we answer the following questions:—What concepts of AC have been used throughout the organization literature?
—What is the diffusion rate throughout the organi-zation literature?
This analysis(performed by the Centre for Science and Technology Studies,Leyden University)identi?es the linkage between AC and various key words based on 1,213publications from the1992–2005period.It mainly maps the structure of all publications citing Cohen and Levinthal(1990)by applying a co-occurrence bibliomet-ric mapping method.With this method we could create a two-dimensional landscape with subdomains repre-senting topic clusters.The topic clusters are created by applying a co-word analysis to the key words in the citing publications.The distances between topic clusters repre-sent their mutual cognitive similarity.
We collected the key words of these1,213publi-cations(key words plus author key words)to assess the content of the?eld of AC.Of the94most fre-quent key words(with20or more occurrences),we selected the83most relevant and discriminative.With these83key words,we calculated the number of times they co-occur in publications.With this information, we applied a clustering analysis to identify11clusters of topics.For instance,the key words alliances,col-laboration,cooperation,joint ventures,embeddedness, networks,and strategic alliances formed a clear topic cluster,and we refer to it as subdomain“interorganiza-tional antecedents.”The key words growth,investment, productivity,FDI,patents,technology transfer,perfor-mance,and sustained competitive advantage represent the subdomain“tangible outcome variables of AC.”In addition,we de?ned the overlap between the clusters (publications may be represented in more than one sub-domain).This overlap was used to create the map as shown below(see Figure1).The resulting bibliometric cartography(Noyons and Van Raan1998a,b;Noyons et al.1999)groups co-occurring key words into clus-ters and maps those clusters in a two-dimensional?gure, with the size of each cluster indicating the number of publications represented and the color of each cluster indicating the growth in the number of publications over the period1992–2005(black:fast growth;gray:growth around average;white:growth below average).Clusters that are closer to one another co-occur more often than clusters that are further apart.The topics that appear
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Figure 2
Growth in Numbers of Publications (Moving Averages)in the Three Antecedents’Sub?elds
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most frequently in AC papers during the period 1992–2005are graphed in Figure 1.
It is quite clear from Figure 1that the bulk of studies focus on R&D rates in various industries (cluster 9),with a strong focus on technology and innovation.Upcom-ing growth areas of AC are studies on knowledge ?ows and dynamic capabilities (cluster 6),the impact of AC on technological innovation and ?rm performance (clus-ter 10),and the effects of relational (trust)versus formal governance modes (cluster 7)on AC (the black circles).Figure 1also shows that in the period 1992—2005,orga-nizational innovation and realized AC have been under-represented (the white circles)because they occurred less often than other AC-related concepts and experi-enced slower than average growth.These clusters are positioned away from the others,indicating that they have been studied less often with other AC-related topics than the other topics.Topics addressing the microfoun-dations of AC were rarely published during the 1992–2005period,with few key words relating to individuals and managers in 14years.Cluster 8,although small,may show some promise here,as it addresses intraorga-nizational antecedents to AC and as such could provide a starting point for further development of the micro-foundations of AC such as organization form,informal networks,personnel,and leveraging across units.How-ever,the growth of the number of AC studies on micro-foundations is quite limited compared to other clusters.As discussed in the previous sections and supported by Figure 1,much effort has been devoted to the managerial and interorganizational antecedents of https://www.wendangku.net/doc/cf14611892.html,pared to the intraorganizational antecedents,the growth of research into the managerial as well as the interorganizational antecedents of
AC has been much stronger in the ?eld (see Figure 2).The moderating
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effects of contextual factors such as industry dynam-ics and environmental conditions (level of competitive-ness and dynamism)have also received much attention (cluster 4in Figure 1).Although a focus on relatively straightforward topics and tangible outcome variables such as patents,R&D investments,productivity,and ?rm growth is clearly relevant (cluster 5),Figure 1shows that other areas have been neglected,with some of them—such as organizational innovation and realized AC—still receiving limited attention.Zahra and George (2002)and Jansen et al.(2005)have addressed realized AC,but more contributions are necessary.Apparently,studies on knowledge recognition and to a lesser extent assimilation are dominating the ?eld,whereas studies on knowledge exploitation are underrepresented.Discussing AC merely as a capacity without discussing the actual processes that link it to outcome variables such as patents,innovation,and performance cannot be regarded as an integrative approach.Similarly,studies that investigate the multidi-rectional effects of AC on organizational innovation in terms of recon?guring the ?rm’s value chain,changing its business model,and redesigning the organizational forms have been very limited in the organization ?eld.Instead,studies on R&D and technological innovation dominate the ?eld.
Figures 3and 4plot the number of papers studying “realized AC”and “organizational innovation”against those studying the topics of “knowledge ?ows and capabilities”and “technological innovation and ?rm performance.”Whereas the latter topics have also been relatively under-researched,AC studies focusing on knowledge ?ows,capabilities,technological innovation,and ?rm performance have clearly experienced strong growth since the late 1990s.
However,Figure 5shows that the diffusion of studies that focus on tangible outcome variables,such as FDI,patents,R&D investments,and knowledge transfer,is
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Figure 4
Growth in Numbers of Publications (Moving
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much higher than those that focus on innovation and ?rm performance.
Our bibliometric analysis clearly shows that AC studies so far have overemphasized R&D rates,vari-ous environmental contexts for AC,interorganizational antecedents of AC such as alliances and joint ven-tures,and the tangible outcomes of AC in terms of FDI and patents.On the other hand,the intraorganizational antecedents of AC,the exploitation process of knowl-edge from the environment,and the intangible outcomes have received considerably less attention in the ?eld.By contrast,research on knowledge ?ows and capa-bilities and their differential effect on AC as well the effects of AC on technological innovation and ?rm per-formance is quickly growing.On the basis of these clear gaps as presented in our bibliometric cartography,we will develop an integrative model taking into account the microfoundations of AC (particularly the intraor-Figure 5
Growth in Numbers of Publications (Moving Averages)in Two Subdomains in the Field of Absorptive Capacity
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ganizational antecedents),the various processes of AC (not only recognition and assimilation but also exploita-tion),and the various outcomes of AC (not only tangible outcomes).
An Integrative Framework of Absorptive Capacity The highly differentiated nature of AC is a hallmark of the ?eld and is evident in the multitude of the-oretical perspectives and empirical constructs brought to bear on the topic.The various underlying theoreti-cal constructs and empirical variables as systematized in Table 1and Figure 1provide us with numerous antecedents,dimensions,mediators,moderators,and out-comes of AC.In spite of this diversity of theories,meth-ods,and empirical studies,the ?eld needs integration and accumulation of knowledge across research efforts in AC.To facilitate accumulation of knowledge,we pro-pose an integrative framework that highlights the main building blocks and outcomes of AC (see Figure 6).The framework identi?es common areas of research in terms of the multilevel antecedents of AC (manage-rial,intraorganizational,interorganizational,and prior related knowledge);process dimensions of AC (acqui-sition,assimilation,transformation,and exploitation);outcomes of AC (competitive advantage,innovation,per-formance);and contextual factors that affect AC (turbu-lence of the knowledge environment).The framework of Figure 6also points to several emerging themes that cut across different research traditions or that have been under-researched.But most important,the framework is used to identify where research ?ndings about AC con-verge and where gaps in our understanding exist.Below we discuss the building blocks of AC.
Managerial Antecedents of Absorptive Capacity.Except in the case of one-person ?rms or very small organizations,an organization’s AC is not resident in any single individual but depends on the links across a mosaic of individual capabilities (Cohen and Levinthal 1990,p.133).AC requires having porous boundaries,scanning broadly for new knowledge,and identifying and using those employees who serve as gatekeepers and boundary spanners (V olberda 1996).Management capa-bilities may synthesize and apply current and acquired knowledge and may be in?uenced and limited by the cognitions and dominant logics of managers (Augier and Teece 2009).In line with Adner and Helfat (2003,p.1012),a dynamic managerial capability refers to the capacity of managers to create,extend,or modify the knowledge resource base of an organization.Examples of these managerial capabilities and skills are the struc-ture of communication,the character and distribution of expertise,gatekeeping or boundary-spanning roles,cross-functional interfaces,and job rotation.We need more research on the relative effect of these manage-ment skills and capabilities on AC.Moreover,there are
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important complementarities between these sets of man-agerial capabilities.For instance,Jansen et al.(2005) study the separate and joint impact of different combina-tive capabilities:coordination,systems,and socialization capabilities and their differential effect on AC.More-over,various formal and informal managerial incentives may differently in?uence AC and knowledge sharing. Aside from managerial capabilities and incentives,?rm AC will be strongly in?uenced by cognitive processes on the managerial level and existing dominant logics of management teams(Mom et al.2007). Intraorganizational Antecedents of Absorptive Capac-ity.A?rm’s knowledge base cannot be separated from how it is currently organized(Grant1996b).An orga-nization form can be viewed as a structure that carries out multiple knowledge-related tasks,such as evaluating, assimilating,integrating,utilizing,and building knowl-edge(Loasby1976).Given this overall insight,vari-ous multiunit organization forms differently in?uence the level and type of AC(Van den Bosch et al.1999). Issues of internal informal networks are also impor-tant for the identi?cation and assimilation of new knowl-edge.Dhanaraj et al.(2004)identify the importance of social embeddedness in transferring tacit and explicit knowledge.Thus networks of individuals in?uence what knowledge is shared or assimilated.For instance,AC can be transferred through hiring new personnel or corporate acquisitions.Unit structure,?rm size,and informal net-works are the sources of heterogeneity of AC.The lack of research on intraorganizational antecedents is sur-prising,especially because Cohen and Levinthal(1990) emphasized the importance of organizational mecha-nisms and suggested considering what aspects of absorp-tive capacity are distinctly organizational.Even when organizational antecedents have been considered(Lane et al.2001),their relationships with different dimensions of AC have not been tested empirically. Interorganizational Antecedents of Absorptive Capac-ity.Gaining knowledge from external sources and learning from partners are critical parts of the interorga-nizational antecedents of AC.The path dependent and often tacit nature of a?rm’s idiosyncratic prior related knowledge and organizational context may limit quick integration of knowledge acquired outside.At the same time,if there is some overlap of knowledge,it may make the assimilation of the knowledge proceed more easily (Puranam et al.2009).AC studies into various interor-ganizational antecedents may provide insights into the costs of assimilating and exploiting knowledge from cor-porate research ventures versus strategic alliances and joint ventures(Benson and Ziedonis2009,Capron and Mitchell2009,Rothearmel and Alexandre2009)Also, social embeddedness,network position,and other fac-tors in?uence the interorganizational antecedents of AC. Research into various interorganizational arrangements
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such as industry clusters,strategic groups,and networks may show the different effects on the various dimensions of AC.
Prior Related Knowledge.Although Cohen and Levinthal’s(1990)statement that prior related knowledge is the most important antecedent to AC has been accepted by many,its importance has been challenged in more recent contributions to the literature(cf.Van den Bosch et al.1999).Moreover,little is known about how the stock of prior knowledge is stored and https://www.wendangku.net/doc/cf14611892.html,-puter databases or routines are two mechanism for stor-ing prior knowledge,but many other avenues that are more tacit,such as stories,norms,etc.,would in?uence how prior knowledge is retrieved and stored(Nonaka and V on Krogh2009).Lenox and King(2004)suggest that prior related knowledge must be distributed throughout the organization to have the largest possible in?uence on the future development of AC.Because our under-standing of the knowledge absorption on lower levels of analysis(such as the group and the individual)is at best limited,the process that connects prior related knowledge with?rm level AC remains unclear.External knowledge that is absorbed by the organization should reach the right individuals at the right time.Similarly,the organization needs to apply prior related knowledge that resides in its employees.
Absorptive Capacity Process.Despite the growing interest in AC,few have captured the richness and mul-tidimensionality of the AC process.Few studies address the processes in detail and how they change over time. In addition,various process dimensions have been sug-gested,ranging from Cohen and Levinthal’s well known dimensions of recognition,assimilation,and exploitation (1990);Zahra and George’s(2002)four dimensions that constitute potential and realized AC;the three process dimensions of exploratory learning,transformative learn-ing,and exploitative learning from Lane et al.(2006)to Todorova and Durisin’s(2007)recognition,acquisition, assimilation or transformation,and exploitation.Exam-ining differing effects of organizational antecedents on AC process dimensions would not only clarify how AC can be developed,but also reveal why?rms have dif-?culties in managing dimensions of AC successfully. Moreover,the underlying tensions between these process dimensions of AC deserve more attention.High levels of acquisition and assimilation of knowledge might be detrimental to the?rms’ability to transform and exploit knowledge.
Environmental Conditions.Both the managerial cog-nition literature(e.g.,Dijksterhuis et al.1999)and the knowledge-based view(e.g.,Van den Bosch et al.1999) indicate that the characteristics of the knowledge envi-ronment in?uence the nature of a?rm’s AC.When the knowledge environment is turbulent,?rms tend to develop AC aimed at exploration,with low ef?ciency, a broad scope,and much?exibility.When the knowl-edge environment is stable,?rms tend to develop AC aimed at exploitation,with high ef?ciency,a narrow scope,and little?exibility(Van den Bosch et al.1999). These ideas,although interesting,are illustrated with case studies only and need to be tested in a large-N context.Also,the moderating effect of various contextual factors(competitiveness,dynamism,knowledge charac-teristics)and regimes of appropriability on the relation-ship between antecedents,AC,and performance requires more research(Lichtenthaler2009).Cohen and Levinthal (1990)show negative moderating effects of appropri-ability on the relationship between antecedents and AC, implying that AC increases with weak regimes and com-petitive spillovers.Zahra and George(2002),however, propose positive moderating effects between AC and per-formance because strong regimes help to sustain compet-itive advantage.
Outcomes of Absorptive Capacity.Absorptive capac-ity is seen as an explanation of competitive advantage (Cohen and Levinthal1989,1990),innovation(Stock et al.2001),exploitation/exploration orientation(Lewin et al.1999),and?rm performance(Lane et al.2001, Tsai2001).Although most studies have focused on the tangible outcomes,AC also seems to result in intan-gible outcomes,such as intraorganizational transfer of knowledge(Gupta and Govindarajan2000),interorga-nizational learning(Lane et al.2001),and knowledge search(Shenkar and Li1999).Moreover,Cohen and Levinthal(1990)pointed out that AC affects expecta-tion formation and the aspiration level of the?rm,per-mitting the?rm to predict more accurately the nature and commercial potential of technological advances(cf. Benson and Ziedonis2009).They suggest that the higher the level of AC,the more likely it is that a?rm will be proactive in exploiting opportunities present in the environment,independent of current performance.Obvi-ously,these outcomes are of great importance for strat-egy and organization research.But we need to know more about the speci?c outcomes and payoffs of AC. AC most likely has positive outcomes,but?rms can also have too much AC.Firms focusing too much on knowl-edge acquisition and assimilation are able to continu-ously renew their knowledge stock,but they may suffer from the costs of acquisition without gaining bene?ts of exploitation(Zahra and George2002,Lichtenthaler 2009).Conversely,?rms focusing on transformation and exploitation may achieve short-term bene?ts but fall into a competence trap(Ahuja and Lampert2001,Jansen et al.2005,Andriopoulos and Lewis2009).
The framework as discussed above identi?es common areas of research that should be further developed in the organization?eld.We especially encourage research that focuses on patterns of coherent,interlinked changes
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in constructs of our integrative framework,rather than simple pairwise performance relationships.Although this complementarity perspective is consistent with the emphasis on“systemic”change among the multilevel antecedents and various knowledge processes of our framework,the relevant complementarities for enhanc-ing absorptive capacity and innovation performance are still rarely investigated in theory and practice(Roberts 2004,Whittington et al.1999).In particular,future research should focus on those complementarities that relate to these interactions that simultaneously take place—within and between the multilevel antecedents, knowledge stocks,absorptive capacity processes,and environmental conditions—that have a major positive impact on absorptive capacity and performance.
Directions for Future Research:Systematizing Research on Gaps
There is little doubt that AC has been one of the most cited and used—and in this sense,one of the most important—constructs to emerge in the management lit-erature in the last two decades.It is a concept that is cognitively appealing as an organizational attribute that captures learning capability,knowledge retention,and utilization.Our paper highlights extensive research uti-lizing the AC concept and enhancing our understanding of it.At the same time,our paper shows that the AC construct is still surrounded by considerable ambiguity with respect to its meaning and nature;the domain(s) in which it exists;and its implications and antecedents, including its microfoundations in individual action and interaction.For example,although the previous sections identi?ed the antecedents on which the literature has focused,the bibliometric analysis and integrative frame-work made it clear that there is little agreement on the relative importance of these antecedents and that certain antecedents,relating to organization(particularly in the form of“formal”organization)and the level of individ-ual agents(including managers)have been neglected. Our analysis identi?es that we still need theoretical development and speci?c studies in the following areas: (1)an unambiguous de?nition of absorptive capacity and the impact of different kinds of knowledge on it;(2)the impact of managerial actions and of individual agents;
(3)the interdependency of micro-macro processes;(4) the impact of certain organizational antecedents,such as structures and informal networks;(5)the effect of interorganizational antecedents such as social networks and channels of communication on AC;(6)the explo-ration of the interactions among intraorganizational and interorganizational antecedents and their relative impor-tance;(7)a deep understanding of prior related knowl-edge,including organizational memory,temporal issues, stocks,and?ows;and(8)an evaluation of optimal AC. These gaps raise opportunities for future research about AC,its antecedents,and its impact on outcomes.In the following discussion,we examine these gaps;our aim is to constructively identify some of the obvious challenges,but also opportunities,for future research. We derive research gaps that may guide future research to fully exploit the AC concept in the organization?eld and to explore fruitful extensions of the concept.We have added to our earlier framework(see Figure7)addi-tional linkages that help to identify opportunities for future research.Furthermore,to better understand the foundations of AC,we build on the work of Coleman (1990),who states that sometimes it is necessary to study the microfoundations of a social system to bet-ter understand it.We identify research opportunities that will explain the social phenomena of AC by explaining the underlying behavior of the antecedents affecting AC. Clearer De?nitions of AC and Construct Boundaries. In spite of the size and richness of the literature on AC,it has yet to converge towards an unambiguous de?nition. Most contributions to the literature follow the de?nition of AC,àla Cohen and Levinthal(1990),as a?rm’s abil-ity to“identify,assimilate and exploit knowledge from the environment.”In itself the Cohen and Levinthal def-inition places few constraints on the domain of the con-struct,which allows many researchers to adapt it to their own needs.Although Cohen and Levinthal mostly look at the absorption of technological knowledge,applying AC to market knowledge is entirely consistent with their de?nition(cf.Lichtenthaler2009).In this connection, Sidhu et al.(2007)make a plea for a three-dimensional search continuum,consisting of supply side knowledge absorption(new technologies),demand side knowledge absorption(new markets),and spatial knowledge absorp-tion(new regions).Some authors(e.g.,Mowery and Oxley1995)de?ne AC as skills relating to tacit tech-nological https://www.wendangku.net/doc/cf14611892.html,ter authors worked toward sub-dividing the notion of AC,for example,with respect to potential/realized and to the kind of knowledge that is absorbed(e.g.,Lim2009).Clearly,the nature of this stock and breadth of knowledge is important,as well as how it is retrieved.In our view,at a minimum,future research needs to be very clear about how AC is being de?ned,its nature,and what impacts AC. Research Gap1A:Research on AC should be explicit about what kind of knowledge is being absorbed. Research Gap1B:Research on AC should address the varying nature of knowledge,the knowledge stock, and the?ow of knowledge.
Managerial Antecedents:The Integration of Micro-and Managerial Foundations.Our bibliometric analy-sis shows that managerial antecedents are among the most important for studies on AC(see Figure2). These typically address managerial actions,dominant logic,and human resource mechanisms.Although they de?ne AC as an organization construct,Cohen and
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Figure7Research Gaps:Interfaces to Explore
Levinthal(1990)also suggest that AC exists on the indi-vidual level.In short,AC is a?rm level construct that has a foundation rooted in an understanding of indi-vidual cognition,motivation,action,and interaction.As Cohen and Levinthal(1990)point out,individual level AC is an important antecedent to organization level AC. Even stronger,the latter is supervenient on the former in the sense that there is no organization level AC without individual level AC.Therefore,the learning behavior of individuals and the choices they make with respect to training,education,knowledge sharing,etc.,are impor-tant foundations of organization level AC.
Thus the understanding of AC as a dependent vari-able,absent of a consideration of the level of individuals and their action,may be inherently incomplete.Future research opportunities exist for applying the notion of AC to the individual actor,and also to the group,and assessing what characteristics of individual cognition, leadership,or motivation in?uence AC or knowledge ?ow and utilization.Furthermore,aspects of organiza-tional life,such as gatekeepers,experts,job turnover, downsizing,and job rotations,could lend themselves to studies addressing their impact on AC and knowledge. Research Gap2:Research on AC should explain the impact of individuals on the AC process.
The Interface Between Managerial Antecedents and Intraorganizational Antecedents.An important charac-teristic of much strategy and management research in the last two decades is an overriding concern with collec-tive constructs,such as competencies,routines,dynamic capabilities,and so on(Felin and Foss2005).Although usually placed on the?rm level,such concepts have also been applied to dyadic relations and even higher levels of aggregation(e.g.,Kogut2000).The AC construct is no exception to this tendency.The implication is that theories that make use of AC as an independent variable cannot explain crucial(microlevel)links between AC and organization level outcomes(e.g.,differential inno-vativeness).In some instances,these linkages are crucial. Thus we identify a gap in the current research and call for additional research that integrates the microfounda-tions of individual learning and intraorganizational level constructs in the hope that understanding these compo-nents of AC will enhance our understanding of AC. As mentioned,Cohen and Levinthal(1989,1990) de?ne AC as a?rm level construct,speci?cally as the ?rm’s ability to recognize,assimilate,and apply new knowledge.As such it is descriptive of a property(or set of properties)that exists on the?rm level.Collec-tive concepts are wholly legitimate,particularly as some
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properties indeed only exist on a collective level.How-ever,an account needs to be made of how the proper-ties described by the collective concept arise from the action and interaction of lower level entities,such as?rm employees,groups,or lower level organizational units (Coleman1990).In this connection,Cohen and Levinthal (1990,p.132)articulate not only that the gatekeeper’s absorptive capacity matters but also that the group as a whole must have some level of relevant background knowledge.In terms of Figure7,this means explaining the emergence of?rm level AC not only by the direct effects(bold arrows)but also in terms of interactions between managerial,intraorganizational,and interorga-nizational antecedents(see the dotted arrows).
This is typically not the route that extant literature has taken(with a few exceptions,such as the work of Argote1999).Instead,the literature has focused solely on antecedents on the collective level.For example, Zahra and George(2002,pp.191–192)focus on“exter-nal knowledge”and the?rm’s“past experience”—both cast as collective constructs—as the primary antecedents to AC.In contrast to this aggregate focus,Cohen and Levinthal(1990,p.131)do mention the level of the indi-vidual and of interaction between individuals as relevant antecedents.As they argue,“An organization’s absorp-tive capacity will depend on the absorptive capacities of its individual members.To this extent,the development of an organization’s absorptive capacity will build on the prior investment in the development of its constituent, individual absorptive capacities.”In fact,when elucidat-ing the concept of AC,they make continuous reference to psychological theories of individual cognitive structures and the development thereof.3
In our view,Cohen and Levinthal and existing research do not establish adequate links between the level of individuals and organization level AC.That is, they do not truly explain AC in terms of individual level cognition and the interaction between individuals. Rather,the reference to the individual level is mainly designed to make use of theories of individual cognition that are used as metaphors for organization level AC. For example,it is argued that psychological research suggests that accumulated prior knowledge increases the ability to put new knowledge into memory and the abil-ity to recall and use it,observations that are supposed to“justify and enrich”the notion of organization level AC.However,current research never truly shows how organization level AC is related to individual cognition and to the interaction of individuals(including learning from other individuals).In sum,there are opportunities for future research to address the emergence of AC in a ?rm.4First,there should be more individual level foun-dation for AC.Second,the“bridging laws”that bring us up from one level of analysis to another one should become more transparent in AC research.Suppose we had a good story about the origins of AC at the indi-vidual/managerial level.How then should we aggregate up to the organizational level?The dyadic level?The extent to which the dynamics of AC are addressed(i.e., the change,improvement,decay,etc.,of AC)and these dynamics are linked to the underlying knowledge-related activities of individuals(i.e.,acquiring new knowledge, learning from other individuals in new ways,etc.),we will have a much clearer theory of how organization level AC arises.
Research Gap3A:Research on AC should explain the origin of organization level AC.
Research Gap3B:Research on AC should clarify how ACs existing on different levels of analysis(individ-ual,organizational,dyadic,etc.)are related.
Figure2identi?es that managerial antecedents have a growing number of citations relating to AC;however, there are opportunities for research,particularly explor-ing the microfoundations of AC.For example,such research may focus on the role that key personnel and turnover play in giving rise to,and changing,AC.This brings issues such as hiring practices,reward systems, and other aspects of HRM into the picture.For example, Foss et al.(2006)examine the link between the assimi-lation of knowledge from users and customers and how this is turned into innovation.They?nd that knowledge-sharing practices—rewards that are linked to knowledge sharing and delegation—are important mediators.The implications of various kinds of training programs also naturally belong here.
Research should also look at speci?c patterns of com-munication in organization and structures for knowledge management such as communities of practice.Oppor-tunities exist to evaluate the impact of communities of practice or the role of technological gatekeepers in dis-covering the trail of the absorbed knowledge through the organization.Who does it reach,who not,and why?This focus brings communication channels and network ties into the picture.In other words,a concern with the micro-foundations of AC leads naturally to a concern with for-mal and informal intraorganizational antecedents. Intraorganizational Antecedents.As Lane et al. (2006)point out,antecedents such as organizational structure(e.g.,the degree of formalization,the level of decentralization,the use of liaison mechanisms,etc.) have been largely overlooked in the AC literature.With some exceptions,other aspects of“organization”have been similarly neglected,such as human resource mech-anisms,reward systems,managerial style,organizational culture,strong and weak network ties,and so on. The overall neglect of organizational antecedents goes back to Cohen and Levinthal(1990),who—in spite of very often touching on organizational issues(e.g.,orga-nizational gatekeepers,internal communication,depart-mentalization,etc.)—do not develop a distinct analysis
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of organization as antecedent to AC.Yet it is clear from their analysis that organizational antecedents must matter.For example,they point out that AC“ refers not only to the acquisition or assimilation of information by an organization,but also to the organization’s ability to exploit it.Therefore,an organization’s AC does not simply depend on the organization’s direct interface with the external environment.It also depends on transfers of knowledge across and within subunits. ”(Cohen and Levinthal1990,p.131)and the capacity for utilizing that knowledge.Future research should address how subunits are de?ned,which activities they encompass,etc. Organizational antecedents also include formal orga-nization,such as the allocation of authority and deci-sion rights,the provision of incentives,the grouping of tasks into departments,etc.Although recent work has addressed how informal organizations in?uence knowl-edge sharing and creation,much less interest has been devoted to formal organizational antecedents of knowl-edge processes,including the creation of AC.Some research,including Jansen et al.(2005),explores the role of coordination,socialization,and systems capabil-ities and?nds that coordination capabilities(i.e.,cross-functional interfaces,participation,and job rotation) primarily enhance the potential AC of organizational units,whereas socialization capabilities(i.e.,interdepart-mental connectedness and socialization tactics)primarily enhance a unit’s realized AC.Moreover,De Boer et al. (1999)and Van den Bosch et al.(1999)show how various organizational forms(e.g.,functional,divisional,matrix) differently affect dimensions of AC in terms of ef?ciency, scope,and?exibility of knowledge integration. Research Gap4A:Research on AC should system-atically explore how formal organization in?uences the level,formation,and dynamic nature of AC and the retrieval of prior knowledge.
Recent work by Tsai(2002)may be helpful for launching future research efforts.He investigates the organizational antecedents of knowledge sharing in intraorganizational networks in various parts of the orga-nization.His?ndings indicate that formal hierarchical structure,in the form of centralization,has a signi?cant negative effect on knowledge sharing.In contrast,infor-mal lateral relations,in the form of social interaction, have a signi?cant positive effect on knowledge sharing. To the extent that increased knowledge sharing implies increased AC(cf.Foss et al.2006),Tsai’s results pro-vide an initial take on the relative importance of various kinds of organization as antecedents of AC.A gap for future research is linking motivation and explicit mone-tary incentives to determine if they enhance knowledge sharing.A related research focus is to explore whether formal and informal organization act as substitutes or complements with respect to in?uencing AC(cf.Gulati and Puranam2009).For example,are rewards for knowl-edge sharing substitutes for social network ties or are they complements?The relative contributions,as well as the interaction of formal and informal organization as antecedents of AC,require further research. Research Gap4B:Research on AC should analyze the relations(substitutability,complementarity)between different kinds of organization with respect to their impact on AC.
Linkages Between Intraorganizational and Interor-ganizational Antecedents.Within organizations and between organizations,knowledge sharing and develop-ment are important components of AC.The in?uence of social networks and the depth of embeddedness in net-works affect the AC in an organization.Often research looks at individuals’networks,and they are assessed and used as beginning points for the organizational level AC. Some research shows that the better interaction there is, the more likely that knowledge will be transferred and assimilated,especially if it is tacit knowledge(Dhanaraj et al.2004).Reagans and McEvily(2003)and Uzzi (1999)?nd that it is easier to transfer tacit knowledge when there are strong ties,and it can be done across structural holes.They also show that broad networks can enhance the capability to recognize and assimilate complex ideas.Cross and Cummings(2004)show that centrality in awareness network increases the likelihood of obtaining knowledge that can help to solve novel problems.Although the above literature looks at how social ties in?uence the sharing of knowledge in gen-eral,applying these insights in the context of AC would involve looking at how intraorganizational ties in?uence knowledge assimilated from external sources and after-wards,knowledge disseminated inside the?rm.In other words,it involves exploring the informal organizational antecedents to the ef?ciency of the internal sharing and communication of externally assimilated knowledge(as in Lenox and King2004).
Research Gap5:Research on AC should draw on social network research to clarify how channels of com-munication implied by networks impact AC. Integration of Intraorganizational and Interorganiza-tional AC Processes.Another important area for future research is in fully exploring how interorganizational antecedents interact with intraorganizational antecedents to create and maintain AC(Easterby-Smith et al.2008, Capron and Mitchell2009,Rothaermel and Alexandre 2009).A neglected part of the original contribution by Cohen and Levinthal is their distinction between “outward-looking”AC and“inward-looking”AC.The former relates to the?rm’s points of contacts with exter-nal sources of knowledge,whereas the latter refers to“the ef?ciency of internal communication”(1990,p.133). Cohen and Levinthal(idem)note that these two aspects
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of AC may be substitutes:“While both of these orga-nizational components are necessary for effective orga-nizational learning,excessive dominance by one or the other will be dysfunctional.If all actors in the organi-zation share the same specialized language,they will be effective in communicating with one another,but they may not be able to tap into diverse external knowledge sources.”
The Not-Invented-Here syndrome is an extreme man-ifestation of outward-looking and inward-looking AC being substitutes.On the other hand,as Cohen and Levinthal mention,both outward-and inward-looking AC would seem to be necessary,as the outward-looking component is not effective without the ability to share internally what has been absorbed from the outside (Benson and Ziedonis2009,p.345;Rothaermel and Alexandre2009).
Research Gap6:Research on AC should examine the relationship between intraorganizational and interor-ganizational antecedents.
Prior Related Knowledge.Although Cohen and Levinthal(1990)emphasize the importance of prior related knowledge,there is a gap in our understanding of how prior knowledge is recognized,stored,and retrieved. Cohen and Levinthal’s(1989)own work involves mak-ing use of AC at time t as a crucial antecedent of AC at t+1.Some studies look at organizational stories as a way of communicating prior knowledge(Lyles1988). Others,such as Lane et al.(2001),for example,are able to use a measure of it from a prior time period,so using longitudinal studies may be one way of capturing prior related knowledge,especially if it is tacit knowl-edge.Few researchers address the nature of the stock,?ow,and breadth of knowledge and how it is stored and retrieved—or for that matter,what Todorova and Durisin (2007)refer to as the“transformation”of the knowledge structures that assist?rms in recognizing new knowl-edge.We have little understanding of the length of time that knowledge can stay stored in organizational memo-ries or when an organization forgets.There are numer-ous research opportunities for addressing such issues as the stock and?ow of knowledge,the temporal nature of knowledge,and the essence of organizational memory. Research Gap7:Research on prior related knowl-edge should examine the nature of the storage and retrieval of it.
What Is Optimum AC?As revealed above,there are strong individual level and organizational dimen-sions to the AC construct.Individuals cannot automat-ically be assumed to be docile and contribute towards building AC.Administrative apparatus needs to be deployed to in?uence employees to undertake the train-ing,form the ties,etc.,that assist the building of AC. It only makes sense that some antecedents would have a stronger relationship to AC.Thus opportunities exist for determining which antecedents among the manage-rial,intraorganizational,and interorganizational have the most impact on AC.
Research Gap8A:Research on AC should aim to determine which organizational antecedents have the greatest impact.
Furthermore,there is little consideration in the liter-ature of the cost of developing AC,changing it,or in some way taking advantage of an organization’s AC. Organizational forgetfulness is not mentioned or linked to individual level or organizational dimensions that impact optimum AC.All this is costly.Foss and Mahnke (2003)note that the knowledge-based literature at large is strangely innocent of notions of costs(whereas ben-e?ts are usually exalted).In particular,organizational costs,they note,are almost universally ignored.The same is true for the AC literature.
For this reason,the issue of whether there is an opti-mum level of AC does not appear to be raised in the literature.Thus maximum AC is implicitly assumed to be desirable,although in the presence of organizational costs of building and maintaining AC,optimum AC is never equal to maximum AC.This suggests the need for research to explore the optimum levels of AC and whether there are ups and downs associated with the level of AC:
Research Gap8B:Research on AC should not assume that maximum AC=optimum AC;on the con-trary,it should identify optimum AC and its determi-nants,taking into account the(marginal)costs and bene?ts of building AC.
In this connection,Jansen et al.(2005)note that future studies should investigate what kind of balance between potential and realized AC leads to superior performance. On the basis of their?ndings in a large multiunit?nan-cial service?rm,they expect that organizational units with baseline levels of realized AC and high levels of potential AC will obtain above-normal performance in dynamic markets.By contrast,Zahra and George’s (2002)claim that a high realized-to-potential AC is pos-itively associated with future performance.Externally acquired knowledge undergoes multiple processes before the recipient?rm or unit can successfully exploit it.In a successful?rm,they argue that realized AC would approach potential AC.However,the study of Jansen et al.(2005)in a large multiunit?nancial?rm shows somewhat different?https://www.wendangku.net/doc/cf14611892.html,anizational units operat-ing in dynamic environments improve their performance by mainly increasing their potential AC.Potential AC provides organizational units with strategic advantages, such as greater?exibility in recon?guring resources and effective timing of knowledge deployment at lower costs, which are necessary to sustain competitive advantage.
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Moreover,organizational units may not always be better off by fully realizing their potential AC in dynamic envi-ronments.Although realized AC promotes innovation, the resultant products and services may rapidly converge to industry standards and become obsolete relative to cur-rent environmental demands(Sorensen and Stuart2000). These?ndings suggest managing levels of potential and realized AC in a timely fashion enhances competitive advantage.Moreover,it may be hypothesized that poten-tial and realized absorptive capacities are complements up to a threshold level,at which they become substitutes.
Concluding Discussion
Although much has been written about absorptive capacity,our article systematically reviews the litera-ture in the?eld and identi?es opportunities for future research and empirical studies.We suggest that there is the need for researchers to build on prior work address-ing the nature of AC,prior related knowledge,and the interactions of the managerial,intraorganizational,and interorganizational antecedents so that there is an accu-mulation of knowledge about AC.Even though AC has emerged as one of the central concepts in modern man-agement research,it spans a number of?elds in manage-ment,such as strategic management,organization theory, international business,etc.This has led to scholars tak-ing many different approaches to AC.It clearly appeals to researchers with different interests,and for this reason it may serve as a bridging concept between?elds.How-ever,this apparent broad applicability is also the weak-ness of the AC construct.For this reason the scienti?c and managerial implications of AC are somewhat unclear (Bacharach1989).
In this perspective paper,we provided a rigorous doc-umentation of the?eld.The contribution of our work has been,on the one hand,to document the diversity in underlying theories and empirical studies that facilitated the rapid advance of the AC?eld and,on the other hand, to analyze its major weaknesses and identify research avenues for further accumulation of knowledge.In par-ticular,based on a bibliometric analysis,we concluded that intraorganizational antecedents,organizational inno-vation and realized AC have been comparatively under-researched in the extant literature on AC.Similarly,we also found that the role of individuals and their interac-tion has been only tangentially included in research on AC.In order to address these shortcomings,we devel-oped an integrative framework of AC that identi?es the underlying dimensions,its multilevel antecedents,its out-comes and the contextual factors that affect AC.From this,we developed various avenues for further research: (1)conceptual work on the de?nition of absorptive capac-ity and its construct boundaries;(2)empirical research on the impact of managerial actions and of individ-ual agents;(3)theoretical as well empirical research efforts on the interdependency of micro-macro processes;
(4)studies on the impact of certain intraorganizational antecedents,such as structures and informal networks;
(5)better understanding of how interorganizational net-works in?uence AC;(6)empirical explorations of the interactions among and relative importance of intraorga-nizational and interorganizational antecedents;(7)deep understanding of prior related knowledge including orga-nizational memory,temporal issues,stocks,and?ows; and(8)evaluation of optimal AC.
In summary,the theoretical foundation of AC is lack-ing in some crucial dimensions;therefore,there are many promising areas for future research.One critical area is that our understanding of the microfoundations of AC needs further development.That is,we do not under-stand how AC arises,exerts its in?uence on innovation and competitive advantage,and is subsequently trans-formed in terms of individual action and interaction that is embedded in an organizational context.Although there is much empirical evidence that prior related?rm level knowledge is an important antecedent to AC,such knowledge does not exert its in?uence on AC directly.It works by in?uencing what individuals know and can do and by in?uencing their interaction.We also do not fully understand the interaction of intra-and interorganiza-tional antecedents on AC—we know these cannot be sep-arated,but which aspects are most important?Further-more,we do not know whether AC becomes optimal,out-of-date,or ineffective.Currently,this“deep structure”of AC is missing from the literature.We have suggested a number of ways in which research may overcome these lacunae.
Acknowledgments
The authors are grateful to Linda Argote for her support throughout the process of writing this paper.The authors also thank Bas Warmerhoven for his assistance,Ed Noyons for his support in the bibliometric analysis,and Kirsten Foss for com-ments on an earlier version of this paper.
Endnotes
1In economics,Stiglitz’s(1987)notion of“learning to learn”is clearly a precursor of AC,as is David’s(1975)analysis of localized technological progress.
2Some of the literature streams summarized here(i.e.,organi-zational learning,innovation,the knowledge-based view,and dynamic capabilities)overlap with those addressed or touched upon in the review paper by Lane et al.(2006).The other two (managerial cognition and coevolution)are implicit in their review,but not incorporated in their model.
3Moreover,in a complicated multilevel(cf.Dansereau et al. 1999)discussion,they also incorporate the level of business units and their interaction.
4To the extent that the emergence or origin of absorptive capac-ity is discussed at all,it is typically in overall terms;for exam-ple,“Acquiring absorptive capacity consists of building(1)the ?rm’s ability to access external knowledge,which requires a
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knowledge-sharing culture,and(2)the?rm’s ability to trans-form and implement external knowledge within the company to enhance its core competencies”(Daghfous2004,p.21).
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