Absorptive capacity within new service development projects: A process study

Absorptive Capacity (ACAP) has emerged as an important topic in innovation management and organizational learning research. Yet, though different conceptualizations have been proposed in recent literature, no consensus about the phases and nature of the absorption process itself has been found. This may be due to the mostly conceptual nature of current ACAP process studies and the general lack of process studies in this field. After a review of existing process conceptualizations, we turn to the findings of two cases studies in the European retail bank sector in which ongoing innovation projects were followed. Firstly, we find five distinct process phases. In these, both the internal knowledge base and the externally sourced information needed to be transformed in order to be able to apply this knowledge. This finding adds a dual focus to the mostly either/or conceptualizations of the transformation of information in present ACAP literature. Secondly, we identify that the absorption phases unfolded in parallel instead of often conceptualized consecutive, step-wise modelling. This parallel nature facilitated considerably overall quality of knowledge acquisition and application due to concurrent feedback loops between the single ACAP stages. Thirdly, by studying the absorption activities of firms in the service sector, we extend current literature by departing from the mostly technological and R&D focused contexts of present research on absorptive capacity.