The effect of absorptive capacity on innovation: the mediator role of human capital, telecommunications companies (Orange, Zain and Umnia) in Jordan

The aim of this paper is to investigate the effect of absorptive capacity on innovation, in telecommunications companies (Orange, Zain, Umnia) in Jordan, and whether human capital mediates the effect of absorptive capacity on innovation. A questionnaire that targets 361 respondents resulted in 346 usable ones with a response rate of 95.8% to test the research hypotheses. Multiple regressions were used to analyse the research data. The findings indicate that absorptive capacity relates positively to innovation, human capital emerged as having the strong effects on innovation. Moreover, all absorptive capacity dimensions had positive significant effects on human capital. The results also support the argument that human capital plays a mediate role in absorptive capacity and innovation. The present study provides managers with an empirical proof that possessing external knowledge through absorptive capacity seems to help reinforce their ability to innovation. In addition, possessing strong human capital effective will motivate and lead more innovation.