Absorptive capacity and strategic alliance in the supply chain context

This paper advances the understanding of absorptive capacity for supply chain participants that are focused symbiotically on acquisition and assimilation of external resources. The fundamental shared belief in the industry is that strategic alliances help firms improve their performance by providing those same firms with new capabilities used to compete and sustain themselves in the marketplace. Firms build absorptive capacity through investing in strategic partnerships, which extend their base of prior knowledge and allow them to identify, extract, exploit external sources of knowledge and apply them to commercial ends. This ability becomes important for the sustenance of competitive advantage. Thus, absorptive capacity moderates the effects of environmental changes on firms´ competitive advantage thereby building superior market success. Subsequently, we reveal the effect of firm´s absorptive capacity on supply chain alliances.