Disentangling the relationship between business model, absorptive capacity, differentiation strategy and performance. Evidence from a transition economy

What is it about?

This study examines the relationships among absorptive capacity, business model design, product strategies, and performance in a unique sample of Albanian manufacturing and service firms. In response to Teece's (2018) call to 'flesh out the details of such relationships, the paper uses structural equation modeling to show that absorptive capacity enables and shapes the novelty business model design, which in turn leads to performance improvements. The paper also shows that the novelty business model design mediates the impact of absorptive capacity on performance, and that the product differentiation strategy moderates the relationship between business model design and performance. The estimated results provide an integrative framework for understanding the role of absorptive capacity in business model design and explaining its relationship with performance, an aspect that helps organizations to succeed in a dynamic environment.

Featured Image