Innovation integration

Absorptive capacity

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Absorptive capacity refers to a firm’s ability to recognise the value of new information, assimilate it, and apply it to commercial ends.   A firm’s absorptive capacity depends greatly on its corpus of prior related knowledge. Internal R&D investment is central to increasing absorptive capacity while simply purchasing results post factum (e.g. patents) may not help. The more a firm invests in R&D activities, the more it will be able to appreciate the value of new external information. Sylphium advises clients on how best to foster absorptive capacity, and build sustainable competitive advantage by leveraging and integrating external developments.