After +25 years in various finance and business leadership roles across Asia-Pacific, Sandeep now runs a boutique strategy consulting and leadership coaching outfit, Value-Unlocked Private Limited. Sandeep's purpose is to help organizations and individuals bring to life the amazing success stories they want to script for themselves, and he delivers this through coaching, consulting and facilitation.
Have you ever come across the term absorptive capacity? It is one of the most critical traits that forecasts your chances of success as an entrepreneur. Higher absorptive capacity could make a huge difference not only for entrepreneurship but even if you are in any other field.
Absorptive capacity is exploring, evaluating, assimilating, and exploiting knowledge. It is the ability to make sense and recognise the value of new information coming your way and find ways to apply it to the work that you are doing. It is the ability to take an idea from one domain, repurpose it and use it in another. Prior history, from education, interests, and experience, forms the foundation of absorptive capacity. You need to have that to find a domain in which to apply the opportunities you see in other domains. Prior knowledge helps form expectations, which, coupled with understanding how new knowledge from a different domain affects these expectations, helps determine whether an idea is worth pursuing. Absorptive capacity is a lens; when placed in the hands of a particular entrepreneur, it allows them to see certain kinds of opportunities that others might see. There is also a downside to it since, given your previous history, you may only see certain opportunities while you miss others.
Ways you can build your absorptive advantage as an entrepreneur
Cultivate a curious mind
Stay curious about various subjects, seek out new knowledge, and be open to exploring unfamiliar territories. A curious mind is like a sponge that soaks and retains all the information coming its way.
Diversify your learning sources
Don't limit yourself to a single source of information or a single topic of interest. Explore books, articles, podcasts, and diverse media. Exposure to different perspectives enriches your understanding and enhances your ability to absorb varied insights. This will build your latent knowledge; the more you delve into it, the more you know about more things.
Network
Meet more and more people from different domains, understand what they are doing and be generally interested in their work. Interacting with individuals from various fields exposes you to new ideas and approaches. I have seen that the startup ecosystem is a great place to network to build your absorptive capacity. The passion of the entrepreneurs for their ideas not only inspires you, but you also understand different kinds of businesses and business models and what made entrepreneurs create these.
Connect the dots
Building your ability to bring the information from various places together and make sense of how it could be helpful in the immediate context. Learn to recognise patterns, identify relationships, and make connections between seemingly unrelated ideas, experiences, or information. Connecting the dots allows us to see the bigger picture, uncover hidden correlations, and generate new possibilities.
Make sense of trends
Most opportunities come seeded in trends right before our eyes, but we don't see them. Observing trends, making sense of them and understanding their first, second and third-level consequences helps build absorptive capacity. So, step back, gain a broader perspective, and find meaningful trend lines for new insights and innovative solutions.
Experiment and take risks
Be willing to experiment with new ideas and take calculated risks. Through experimentation, you can test the applicability of new knowledge in real-life situations and learn from successes and setbacks. A mindset of adaptability and flexibility is inherent to experimentation. The ability to adjust to new information and changing circumstances is critical to absorptive capacity.
Just as organisations survive by adapting and pivoting, individuals thrive by embracing change and learning. Absorptive capacity on a personal level is a continuous journey of self-improvement, exploration, and embracing the richness of the world. In a world where change is the only constant, absorptive capacity guides us through uncharted territories. Embrace curiosity, diversify your learning, network with fervour, connect the dots, decipher trends, and dare to experiment.
Not all those who wander on uncharted paths are lost, for exploration is the essence of human spirit.
Sandeep Jain, Leadership Coach & Strategy Consultant
Sandeep Jain | Leadership Coach & Strategy Consultant | CEO, Value-Unlocked Private Limited
After +25 years in various finance and business leadership roles across Asia-Pacific, Sandeep now runs a boutique strategy consulting and leadership coaching outfit, Value-Unlocked Private Limited.
Sandeep's purpose is to help organizations and individuals bring to life the amazing success stories they want to script for themselves, and he delivers this through coaching, consulting and facilitation.
As a coach, Sandeep primarily works with CXOs in organization-sponsored engagements and with senior teams on agendas around leadership, strategy, purpose and values, business growth, etc. On the strategy consulting side, he helps companies deliver on their transformation agendas through interventions around route-to-market, portfolio optimization, operational efficiencies, leveraging industry-ready technology solutions, cost savings, and organization re-design.
