Pioneering Orientation as Mediator between Absorptive Capacity and New Product Performance: An Abstract

Abstract

Knowledge is undoubtedly one of the most important factors that help organization to achieve competitive advantage against rivals. Absorptive capacity (ACAP) reflects an organizational capability that enables firms to assess, assimilate and finally applicate their knowledge within the organization. At the same time, the implementation of organizational knowledge is expressed through adoption of an appropriate organizational strategy. In this study we choose pioneering orientation (PO) to be a strategy whereby the organizations think, make decisions and act in order to advance new product development. Against this background, our study aims to advance the marketing literature by examining the impact of ACAP on new product performance (NPP) and identifying the role of PO as a mediator of the ACAP – NPP relationship. A growing body of research has documented the positive contribution of ACAP to NPP. However, understanding how to manage PO as organizational strategy is important managerially and theoretically. Following Cadiz et al. (2009), we define ACAP as a three-dimensional construct: assessment, assimilation and application. The PO scale was taken from Covin et al. (1999) and included four items. The NPP scale was taken from Murray et al. (2011) and included three items. We hypothesize that PO mediate the relationships between ACAP and NPP. Data were collected through a professional online panel company. The sample included 304 managers in Israeli organizations, who responded to a questionnaire with 7-point scales (1 = strongly disagree to 7 = strongly agree). All scales were reliable with Cronbach’s alpha coefficient exceeding 0.70 (Nunnally 1978). Using Structural Equation Modeling (SEM) via AMOS software the results of the measurement model indicate a good fit with χ2 = 167.12, DF = 82, χ2/DF = 2.04, p =.00, IFI =.98, CFI =.98, TLI =.97, and RMSEA =.06. The data indicated a positive and significant impact of ACAP on PO (β = 0.73; p ≤ 0.01). Also, the impact of PO on NPP was found positive and significant (β = 0.78; p ≤ 0.01). However, the direct effect of ACAP on NPP was not found significant. These findings indicate that PO can play a role of full mediator between ACAP and NPP. In light of these findings we can argue that PO looks like an excellent pathway that helps to exploit and use the knowledge absorbed in the organization when the goal of the organization is the success of NPP. This study provides several managerial implications. First, managers should constantly pursuit after new ways to acquire, assimilate and applicate knowledge within the organization in order to leverage their competitive advantage and strengthen their absorptive capacity against their rivals. Second, managers should take some risks in order to enhance their pioneering strategy. By doing so they may respond effectively to competitive threats in the marketplace, and differentiate themselves from others to promote new product development which eventually may improve their NPP.