THE ROLE OF STRATEGIC AND OPERATIONAL ABSORPTIVE CAPACITY IN ORGANIZATIONAL AMBIDEXTERITY

Abstract

In today’s dynamic corporate environment where firms struggle to maintain a competitive advantage, ambidextrous firms focusing on both exploration and exploitation are more likely to survive and prosper in the long run. Scholars have identified and examined a number of antecedents of organizational ambidexterity, but extant studies have not fully explored the role of a firm’s absorptive capacity in developing its organizational ambidexterity. The relevance of the absorptive capacity concept is paramount since new sources of competitive advantage would very likely come from outside the organizations. In this research, I explore the relationship between a firm’s absorptive capacity and organizational ambidexterity by focusing on two levels of absorptive capacity and three dimensions of organizational ambidexterity. Using a survey of 5,600 companies performed by the Government of Chile in 2015, and then a subsample of panel data that includes 760 companies for the 2009-2014 period, I find that both strategic and operational absorptive capacity contribute to the incremental exploitation dimension of organizational ambidexterity. My study contributes to our understanding of the absorptive capacity construct and illuminates how it affects organizational ambidexterity. The study also provides managerial implications as to what kind of external knowledge to procure and how to leverage it based on the firm’s ambidexterity goals.