Effects of absorptive capacity on incremental and radical innovation based on organisational learning processes

Open innovation, joint development, and knowledge absorption have been the focuses of innovation theories and practical development. In an open innovative environment, absorptive capacity becomes a key factor in the technical innovation of an enterprise. The technical innovation process of an enterprise, as the key factor in networking innovation, is generally embedded in specific environments. The effect and direction of absorptive capacity on technical innovation therefore would be affected by the environment. Past research on the effects of absorptive capacity seldom involved in such a contingent factor, and definitions of absorptive capacity based on the perspective of process were even fewer. As a consequence, innovation-oriented firms in Guangdong are selected as the research subject in this study. With questionnaire survey, 161 valid samples are collected the data, which are further verified with hierarchical regression. The research findings show insignificant moderating effects of technological and market turbulence on the relationship between absorptive capacity, the three organisational learning processes and incremental innovation, while absorptive capacity appears more obvious acceleration effects on radical innovation in the environment with high technological and market turbulence. Similarly, absorptive capacity-based exploitative learning, in the environment with high market turbulence, presents stronger acceleration effects on radical innovation of innovation-oriented firms in Guangdong.