Combined Influence of Absorptive Capacity and Corporate Entrepreneurship on Performance

Abstract

Drawing on a dynamic capabilities perspective and a resource-based view, this article analyzes the relationship between absorptive capacity and corporate entrepreneurship, and their combined e ect on organizations’ performance. It contributes to the literature by dissociating the dimensions of absorptive capacity (potential and realized) and corporate entrepreneurship (innovativeness, proactiveness, new business venturing, and self-renewal). A quantitative study was performed with data gathered by personal interviews, using a structured questionnaire. The theoretical model was estimated through a structural equation model, using a sample of 168 Spanish firms. The results show that proactiveness positively influences innovativeness and that both proactiveness and innovativeness have a positive influence on potential and realized absorptive capacity. A significant positive relationship also exists between potential and realized absorptive capacity. Furthermore, realized absorptive capacity positively influences new business venturing and self-renewal. Finally, proactiveness and new business venturing directly and positively influence organizational performance, but not innovativeness and self-renewal. The study demonstrates that entrepreneurs must be able to enhance potential and realize absorptive capacities at the same time in order to improve the end performance of their corporate entrepreneurial projects. Both absorptive capacities are strongly related to corporate entrepreneurial activities and have a strong influence on firms’ performance.