PurposeThis study examines the effect of political networking capability (PNC) and strategic capability on exploratory innovation/exploitative innovation through the mediation of absorptive capability (AC).Design/methodology/approachUsing empirical survey data collected from 153 traditional manufacturing firms (TMFs) in China, the authors apply partial least squares structural equation modeling (PLS-SEM) combined with mediation analyses to test hypotheses.FindingsPNC has a higher impact on exploratory innovation than exploitative innovation through AC. The authors thus provide novel empirical insights into independent variables of firms' ambidextrous innovation and their implementation mechanisms.Research limitations/implicationsThe authors highlight a unique situation of China and contribute to the literature on PNC and AC. The findings demonstrate that AC plays an important role in configuring government-obtained external resources into new products, thus influencing ambidextrous innovation strategic decisions.Practical implicationsTMFs' executives should enhance PNC to obtain more resources to conduct exploratory and exploitative innovation. Government officials and policymakers should strengthen the supervision of TMFs' innovation activities and adopt effective measures to ensure that TMFs could conduct more exploratory innovation as governments expected.Originality/valueThis study provides new insights by bridging research gaps in the literature and advances the insights of how TMFs' PNC/strategic capability directly and indirectly fosters exploratory and exploitative innovation via the mediating role of AC in China.

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