Absorptive Capacity as a Precondition for Business Process Improvement

Abstract

Improving organizational performance by redesigning business processes and supporting them with a proper information system is a daunting challenge. We analyze the possibilities of business process management in general and in the healthcare sector in particular. The role of business process modeling as a way to increase an organization's absorptive capacity is analyzed. A longitudinal case study of a European public healthcare insurance company identifies the factors either increasing or hindering absorptive capacity. The case presents that the dilemma between radical and incremental approach to improve business processes is somehow artificial since the radicalness of changes depends on the difference between the absorptive capacity and the extent of the proposed changes. The paper shows that business process management projects should not merely focus on the development of methodologically correct models, but should be used as an opportunity to increase the absorptive capacity of an organization.

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