Absorptive capacity: A hub of blue ocean and red ocean strategies and capability transformation in innovative business environments

Firms operating in innovative environments often keep track of their strategies (Blue Ocean and Red Ocean) by keeping a balance of market exploration and exploitation. There comes a point where companies feel that transformation of their capabilities to adopt a contrasting strategy requires capability transformation. This study addresses this process through absorptive capacity. Our study argues the pivot role of absorptive capacity by effective utilization of resources in capability transformation to adopt the contrasting strategy while keeping a balance of exploration and exploitation in the organisation.