Unpacking the Black Box of Absorptive Capacity and Testing a Firm Level Theory of Innovation-Imitation Adaptation: A Panel Study of Firms Offshoring of White Collar Jobs

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The goal of this research project is to unpack the black box of absorptive capacity and test a firm level theory on role of innovation-imitation in firm adaptation. This longitudinal study uses new original firm-level panel data on offshoring of white collar administrative and technical jobs. Theory-guided field study of selected companies in the panel provides direct observation and description of underlying routines that make up absorptive capacity capability of firms. A series of case studies provides specific process description and expression of routines as input to the design of a new survey instrument specifically for measuring firm internal and external absorptive capacity. Two key research questions will be addressed econometrically. The first one is whether and how early and late adopters in same new offshoring business differ in terms of their absorptive capacity. The second one is whether successful early adopters of a new offshoring business practice exploit specific past experiences and develop certain absorptive capacity capabilities that enable them to persist in applying and innovating new offshoring business practices as offshoring of white collar jobs evolves over time and becomes an established industry practice. In addition the longitudinal panel data will also be used in developing heterogeneous diffusion models within sectors and across the entire population of organizations.Broader impacts of the research project. The project will build a community of researchers and practitioners for sharing best practices involving offshoring of white collar jobs while also advancing research on emergence and diffusion of offshoring and its associated organizational routines. The offshoring project findings have wider implications for sourcing and locating human capital anywhere in the world and for tracking the emergence of web based network organizational form. The research on unpacking black box of absorptive capacity has direct implications for advancing knowledge and managerial practices involving strategic renewal of companies and industries. Research findings will be disseminated through academic publications, the media, and CIBER-led National Forum on Trade Policy.