An empirical examination of the relationship between managerial strategic thinking and absorptive capacity of the organization

Purpose: Recently, researchers have highlighted the limited attention that has been devoted to managerial capabilities as micro-foundational elements of absorptive capacity. Strategic thinking is one such managerial capability that guides managers during the development of organizational capabilities. The purpose of this paper is to empirically investigate the influence of managerial strategic thinking on the development of absorptive capacity. Design/methodology/approach: Data were collected using a sample of 324 senior-level and mid-level managers from the software industry. PLS-SEM was used to test the hypothesized relationships. Findings: Study results indicate that managerial strategic thinking is positively related to absorptive capacity, as well as to each of its four components – acquisition, assimilation, transformation and exploitation. Originality/value: The current study adopts a micro-foundations perspective and delves into the development and orchestration of organizational capabilities. This study is the first to empirically investigate the relationship between managerial strategic thinking and absorptive capacity. Prior literature on absorptive capacity has focused on its influence on phenomena that are downstream to absorptive capacity, e.g. innovation, new product development and firm performance. The research offers new insights into the relationship between absorptive capacity and managerial strategic thinking, a hitherto unexplored upstream phenomenon. Scholars have theorized that managerial strategic thinking plays a pivotal role in managerial decisions, making it a critical factor in developing the absorptive capacity of an organization. The authors believe that the empirical evidence of the theorized relationship offers valuable insights that will aid scholarly research on organizational capabilities.