How leadership enhances absorptive capacity for Industry 4.0 technology adoption through social integration mechanisms

Using absorptive capacity theory, we explore the factors affecting the adoption of Industry 4.0 technology in daily operations and examine how leadership enhances absorptive capacity through social integration mechanisms. To follow the implementation of a connected worker programme (a type of Industry 4.0 technology) between 2023 and 2025, a single embedded case design was used within four factories of a large multinational firm. The reflective R-TEAM approach included meetings with senior management, key informant interviews, qualitative surveys, and group interviews. The factories showed a shift in absorptive capacity capabilities. Initially, top managers used transformational leadership to learn about and initiate the connected worker programme. As organisational transformation and programme exploitation proved difficult, middle managers and frontline leaders adopted instrumental leadership behaviours. These leaders created three social integration mechanisms: learning from app usage, co-development and feedback, and training. This improved the factories’ ability to adopt the programme, with headquarters aspiring to build a comprehensive ecosystem for data-driven decision making at all levels. Our study expands absorptive capacity theory by exploring how social integration mechanisms affect realised absorptive capacity and its drivers. It also incorporates transformational and instrumental leadership at various levels to explain improvements in social integration mechanisms and organisation’s absorptive capacity. We draw a conceptual model for Industry 4.0 technology adoption to guide future research.