Digital product development team external knowledge processes and ambidexterity: a multi-mediation analysis of the absorptive capacity framework

Purpose The purpose of this study is to examine the mechanisms of absorptive capacity (ACAP) in the specific context of digital product development teams. More precisely, it explores the process of internalizing and utilizing external knowledge from sources outside the team to promote the development of innovative ambidexterity. Design/methodology/approach The study employs the ACAP framework and directs specific attention to the concept of knowledge assimilation, encompassing comprehension, documentation and dissemination. Seventy-five employees of one of Indonesia’s largest commercial banks were surveyed about two initiatives they participated in. To this end, 12 research hypotheses are formulated, tested and analyzed using structural equation modeling. Findings Knowledge comprehension, documentation and dissemination are found to mediate between knowledge acquisition and knowledge exploitation. At the same time, the relationship between knowledge acquisition and knowledge transformation is mediated by knowledge comprehension and dissemination, but not documentation. The authors also found that knowledge transformation positively mediates between knowledge comprehension and dissemination on the one hand and ambidexterity on the other hand. Importantly, knowledge exploitation negatively mediates between knowledge comprehension and documentation on the one hand and ambidexterity on the other hand. Originality/value This study contributes to the existing body of knowledge by offering nuanced insights into the interplay of knowledge assimilation processes within ACAP, particularly in the context of digital product development. The identification of mediating factors and their impacts on ambidexterity provides valuable implications for both theory and practice in this domain.