Coevolution of Firm Absorptive Capacity and Knowledge Environment: Organizational Forms and Combinative Capabilities

TLDR

Absorptive capacity is widely regarded as central to organizational coevolution, yet most research has focused on prior related knowledge as its determinant. This study investigates how organizational forms and combinative capabilities shape absorptive capacity and develops a framework linking it to micro‑ and macrocoevolutionary effects. The authors construct a framework illustrating these relationships and validate it through two longitudinal case studies of publishing firms transitioning to a multimedia environment. The framework demonstrates that knowledge environments coevolve with the emergence of organizational forms and combinative capabilities that facilitate knowledge absorption.

Abstract

This paper advances the understanding of absorptive capacity for assimilating new knowledge as a mediating variable of organization adaptation. Many scholars suggest a firm's absorptive capacity plays a key role in the process of coevolution (Lewin et al., this issue). So far, most publications, in following Cohen and Levinthal (1990), have considered the level of prior related knowledge as the determinant of absorptive capacity. We suggest, however, that two specific organizational determinants of absorptive capacity should also be considered: organization forms and combinative capabilities. We will show how these organizational determinants influence the level of absorptive capacity, ceteris paribus the level of prior related knowledge. Subsequently, we will develop a framework in which absorptive capacity is related to both micro- and macrocoevolutionary effects. This framework offers an explanation of how knowledge environments coevolve with the emergence of organization forms and combinative capabilities that are suitable for absorbing knowledge. We will illustrate the framework by discussing two longitudinal case studies of traditional publishing firms moving into the turbulent knowledge environment of an emerging multimedia industrial complex.