The Impact of Corporate Culture on the Absorptive Capacity and Innovative Capacity of Companies

The Impact of Corporate Culture on the Absorptive Capacity and Innovative Capacity of Companies

Enric Serradell López (Department of Business and Management Sciences, Open University of Catalonia, Barcelona, Spain) and Carlos Grau Alguero (Department of Economy and Organization, University of Barcelona, Barcelona, Spain)
Copyright: © 2013 |Pages: 16
DOI: 10.4018/ijksr.2013070104
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Abstract

The purpose of this study is to gain a better understanding of the influence of corporate culture in the absorptive and innovative capacities of Spanish enterprises. This is an exploratory study conducted involving top managers from a sample of 53 large Spanish companies. An empirical analysis is performed using a structural equations model and bootstrapping methodology. The paper highlights the role of corporate culture as a concept that has a significant influence on the absorptive capacity and also on the innovative capacity of enterprises. The absorptive capacity is presented as a system that makes a work of observation, identification, collection and use of information and knowledge from abroad, which is considered essential to achieving and sustaining competitive advantage. The research performed shows how the different components of absorptive capacity, found in the literature are significant configuring the capacity as a latent variable with economic sense. Furthermore, regarding the sample studied, corporate culture has a significant influence on the innovative capacity. The model explains the influence of culture in the innovative capacity, and in the two components of it, incremental and radical innovation. The investigation has found also some interactions not included in the model proposed, as for example the relationship between the recognition as the part of the absorptive capacity component more related with radical innovation. The empirical model performed need to be replicated with other samples for further findings and possible generalization. Deconstructing corporate culture in eight dimensions permits to use some of them in a prescriptive way. The adoption of certain cultural values and attitudes and the use of management strategies designed to promote these values and attitudes, encourage the company to more easily benefit from the opportunities of their environment, increasing the ability to manage information of the environment.
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Introduction

In recent years, academics and company managers have become increasingly interested in corporate culture. It has thus become one of the most widely-developed fields of research in recent years. Despite all this, and although senior management increasingly considers the analysis and diagnosis of corporate culture to be one of the fundamental work variables, its special characteristics and intangible nature make it difficult to observe and study. In an attempt to fill this gap, we propose an analysis of corporate culture which will allow a closer look at this field. We intend to show how corporate culture allows the development of other business capacities, including absorptive capacity, and to confirm its influence on companies' innovative capacity.

In order to complete the aim of the study we have researched 53 large Spanish companies, examining the overall effect of corporate culture on absorptive capacity and the level of companies' incremental and radical innovation. We intend to make the following contributions to scientific literature:

  • 1.

    Verifying the influence of corporate culture on companies' absorptive and innovative capacity;

  • 2.

    Verifying the relationship of the different components of absorptive capacity with companies' innovative capacity;

  • 3.

    Finally, we intend to offer a prescriptive contribution which will be of use to company managers who intend to manage their organisation in terms of capacities.

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