THE ROLE OF ABSORPTIVE CAPACITY IN THE ADOPTION OF SMART MANUFACTURING

Purpose – Smart Manufacturing (SM) lies at the core of Industry 4.0. Operations management research has identified several factors influencing firms’ ability to adopt SM. However, a clear understanding of capabilities needed to progress in SM is still missing. This paper aims to investigate how absorptive capacity (AC) allows firms to advance in SM and explore how managerial antecedents support the capacity to absorb SM-related knowledge at different stages of SM adoption. Design/methodology/approach – This study adopts an exploratory approach through multiple case studies. Twelve firms, operating as part of the automotive supply chain and exhibiting different stages of SM adoption, constitute the sample. Findings – The results suggest that advancement in SM requires firms to progressively reinforce their AC. Firms’ ability to acquire and assimilate SM knowledge is supported by managerial antecedents encompassing integrative capacities to bridge old and SM technologies, managerial cognition through the clear alignment of SM technologies with strategic goals and knowledge development capabilities through practices oriented to provide senior managers with SM competences. Originality/value – The findings contribute to SM research by suggesting that AC is a crucial dynamic capability for SM adoption. The results also provide evidence-grounded recommendations to firms engaged in the digital transformation on the managerial capabilities needed to support AC and to progress from lower to higher stages of SM.