Absorptive capacity in new ventures: differences among corporate ventures and independent ventures

This paper describes a study of the effects of venture origin on ACAP dimensions addressing two questions: how differently do corporate ventures (CVs) and independent ventures (IVs) build their ACAP? And, what are the effects of these differing ways of building ACAP on the new venture performance (NVP) and strategic variety? In answering these questions, we build on three related theoretical perspectives: resource-based view (Barney, 1991; Peteraf, 1993), knowledge-based theory (Grant, 1996), and the dynamic capabilities approach (Teece et al., 1997; Winter, 2003). Using data from face-to-face interviews and surveys on 140 new ventures, our results show that CVs primarily focus on developing the ACAP processes of acquisition and assimilation of new external knowledge when compared to IVs; and that IVs center their efforts in commercially exploiting the knowledge externally acquired. We did not find evidence of significant differences among CVs and IVs in their strategic variety. Yet, we found that an emphasis on potential ACAP is positively associated with the strategic variety of both CVs and IVs. Finally, our results reveal that ACAP is not directly related to NVP

Enriching strategic variety in new ventures through external knowledge

To build profitable market positions, new ventures have to address multiple challenges on several fronts. These ventures can compete by being simple (focused) or applying varied ways to compete. The likelihood of these ventures remaining competitive depends on their ability to build novelty into their products and operations, an activity that requires infusing knowledge into their operations. Most ventures, however, have limited knowledge bases and the reach (scope) of their external connections is limited, a factor that prompts them to tap into different external sources in their local areas. This article reports an empirical study of 140 new ventures located in seven regional clusters in Spain. The results show that new ventures can enrich the variety of their strategic repertoire by accessing diverse sources of external knowledge and being exposed to external novel knowledge, while absorptive capacity moderates this relationship. The degree of social development of these clusters also has a positive impact on the strategic variety of new ventures, exhibiting an inverted U-shape curve

Entrepreneurial orientation in low- and medium-tech industries: the need for absorptive capacity to increase performance

The implications of Entrepreneurial Orientation (EO) for firm performance in low- and medium-tech (LMT) industries are largely unexplored and seem to be limited. In this paper we seek to address this research gap studying how Absorptive Capacity can act as a key factor determining the effectiveness of EO in such a context. Specifically, we adopt the knowledge-based view of the firm and explore the moderating effects of Absorptive Capacity’s Potential and Realized dimensions on the EO–performance relationship in LMT industries. Our regression results based on a lagged dataset of 103 medium-sized firms based in Italy confirm our hypotheses that, in LMT industries, EO has a positive effect on firm performance when coupled with high levels of both Potential and Realized Absorptive Capacity

Is blood thicker than water? Exploring the impact of family firms’ familial social relations with other firms within their industries

The benefits or drawbacks of family social capital for family firm performance are hotly debated among scholars. Most of the debate adopts an internal view of family social capital and focuses on familial relations taking place within the boundaries of the family firm or the family business group. However, overlooked in this debate is the role of potentially valuable family bonds held with family members outside the family firm and the family business group’s boundaries—family members working for other firms without ownership connections. We strive to advance this debate by placing the focus on a new category of family social capital originating from social relations with family members working in other firms in the same industry. In so doing, we theoretically and empirically tease out how the number of ties with family members located in other independent firms within the boundaries of a given industry affects family firms’ performance. We also account for the moderating effect on this baseline relationship of the number of ties with members of other firms not bearing a family connection. In so doing, we add new insights to address the paradox among family firm studies about why seemingly vital social relations only sometimes matter for family firm performance