Bridging absorptive capacity, innovation, and performance: management innovation as a social integration mechanism

This study analyzes the relationships between absorptive capacity (ACAP), management innovation, technological innovation, and firm performance through a multiple mediation model. Using survey data from a sample of firms, the proposed relationships were tested through structural equation modeling (PLS-SEM). The findings highlight the critical role of management innovation as a social integration mechanism that bridges the gap between potential ACAP (PACAP) and realized ACAP (RACAP). Specifically, the results reveal three complementary mediations: (i) management innovation mediates the PACAP-RACAP relationship, (ii) RACAP mediates the management innovation-technological innovation relationship, and (iii) technological innovation mediates the management innovation-performance relationship. Furthermore, full mediation effects are found in the PACAP-technological innovation, PACAP-performance, and RACAP-performance relationships. These findings underscore the importance of management innovation not only as an innovation outcome but also as a key enabler of knowledge transformation and exploitation. The study contributes to the absorptive capacity and innovation literature by providing empirical evidence from an emerging economy, reinforcing the idea that innovation -both managerial and technological- is essential for translating absorbed knowledge into superior firm performance.