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Structural Differentiation and Ambidexterity: The Mediating Role of Integration Mechanisms

TL;DR: The findings suggest that the previously asserted direct effect of structural differentiation on ambidexterity operates through informal senior team and formal organizational integration mechanisms, and contributes to a greater clarity and better understanding of how organizations may effectively pursue exploration and exploitation simultaneously to achieve ambideXterity.
Abstract: textPrior studies have emphasized that structural attributes are crucial to simultaneously pursuing exploration and exploitation, yet our understanding of antecedents of ambidexterity is still limited. Structural differentiation can help ambidextrous organizations to maintain multiple inconsistent and conflicting demands; however, differentiated exploratory and exploitative activities need to mobilized, coordinated, integrated, and applied. Based on this idea, we delineate formal and informal senior team integration mechanisms (i.e. contingency rewards and social integration) and formal and informal organizational integration mechanisms (i.e. cross-functional interfaces and connectedness) and examine how they mediate the relationship between structural differentiation and ambidexterity. Overall, our findings suggest that the previously asserted direct effect of structural differentiation on ambidexterity operates through informal senior team (i.e. senior team social integration) and formal organizational (i.e. cross-functional interfaces) integration mechanisms. Through this richer explanation and empirical assessment, we contribute to a greater clarity and better understanding of how organizations may effectively pursue exploration and exploitation simultaneously to achieve ambidexterity.

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TL;DR: In this paper, the authors draw on a variety of cognate literatures to discuss the field-level structural characteristics and organizational attributes that shape institutional complexity and explore the repertoire of strategies and structures that organizations deploy to cope with multiple, competing demands.
Abstract: Organizations face institutional complexity whenever they confront incompatible prescriptions from multiple institutional logics. Our interest is in how plural institutional logics, refracted through field-level structures and processes, are experienced within organizations and how organizations respond to such complexity. We draw on a variety of cognate literatures to discuss the field-level structural characteristics and organizational attributes that shape institutional complexity. We then explore the repertoire of strategies and structures that organizations deploy to cope with multiple, competing demands. The analytical framework developed herein is presented to guide future scholarship in the systematic analysis of institutional complexity. We conclude by suggesting avenues for future research.

2,129 citations


Cites background from "Structural Differentiation and Ambi..."

  • ...…the ambidextrous approach and to minimize internal resistance, and the skills to communicate clearly their approach in order to offset any media skepticism (e.g., O’Reilly & Tushman, 2004; Jansen et al., 2009; Fang, Lee, & Schilling, 2010; Benner & Tushman, 2003; Siggelkow & Levinthal, 2003)....

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  • ...These include the need for “ambidextrous leaders” with the ability to understand the requirements of different types of businesses, the authority to implement new incentive systems to institutionalize the ambidextrous approach and to minimize internal resistance, and the skills to communicate clearly their approach in order to offset any media skepticism (e.g., O’Reilly & Tushman, 2004; Jansen et al., 2009; Fang, Lee, & Schilling, 2010; Benner & Tushman, 2003; Siggelkow & Levinthal, 2003)....

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Journal ArticleDOI
TL;DR: An overview of the seven articles included in this special issue is provided and several avenues for future research are suggested.
Abstract: Organizational ambidexterity has emerged as a new research paradigm in organization theory, yet several issues fundamental to this debate remain controversial. We explore four central tensions here: Should organizations achieve ambidexterity through differentiation or through integration? Does ambidexterity occur at the individual or organizational level? Must organizations take a static or dynamic perspective on ambidexterity? Finally, can ambidexterity arise internally, or do firms have to externalize some processes? We provide an overview of the seven articles included in this special issue and suggest several avenues for future research.

1,946 citations


Cites background from "Structural Differentiation and Ambi..."

  • ...The Jansen et al. (2009) article “Structural Differentiation and Ambidexterity: The Mediating Role of Integration Mechanisms” claims that structural differentiation can help ambidextrous organizations maintain multiple inconsistent and conflicting demands; however, these differentiated activities…...

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  • ...Third, ambidexterity may arise from both simultaneous and sequential attention to exploitation and exploration....

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  • ...Kogut and Zander (1992, p. 384) describe “combinative capabilities” as the firm’s ability “to synthesize and apply current and acquired knowledge.”...

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  • ...Several studies in this special issue provide the first evidence that ambidexterity results from interactions across multiple levels (Andriopoulos and Lewis 2009, Groysberg and Lee 2009, Jansen et al. 2009, Mom et al. 2009, Taylor and Helfat 2009)....

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Posted Content
01 Jan 2013
TL;DR: Organizational ambidexterity refers to the ability of an organization to both explore and exploit--to compete in mature technologies and markets where efficiency, control, and incremental improvement are prized and to also compete in new technologies as mentioned in this paper.
Abstract: Organizational ambidexterity refers to the ability of an organization to both explore and exploit--to compete in mature technologies and markets where efficiency, control, and incremental improvement are prized and to also compete in new technologies and markets where flexibility, autonomy, and experimentation are needed. In the past 15 years there has been an explosion of interest and research on this topic. We briefly review the current state of the research, highlighting what we know and don't know about the topic. We close with a point of view on promising areas for ongoing research.

1,350 citations

Journal ArticleDOI
TL;DR: The exploration and exploitation framework has attracted substantial interest from scholars studying phenomena such as organizational learning, knowledge management, innovation, organizational design, and strategic alliances as discussed by the authors, and it has become an essential lens for interpreting various behaviors and outcomes within and across organizations.
Abstract: Jim March's framework of exploration and exploitation has drawn substantial interest from scholars studying phenomena such as organizational learning, knowledge management, innovation, organizational design, and strategic alliances. This framework has become an essential lens for interpreting various behaviors and outcomes within and across organizations. Despite its straightforwardness, this framework has generated debates concerning the definition of exploration and exploitation, and their measurement, antecedents, and consequences. We critically review the growing literature on exploration and exploitation, discuss various perspectives, raise conceptual and empirical concerns, underscore challenges for further development of this literature, and provide directions for future research.

1,241 citations


Cites background from "Structural Differentiation and Ambi..."

  • ...…the notion of ambidexterity quite narrowly when referring to contextual balancing and organizational separation, whereas many studies consider ambidexterity as a general term for describing balance between exploration and exploitation (e.g., Jansen et al., 2009; Raisch et al., 2009; Simsek, 2009)....

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  • ...By loosely integrating their exploratory and exploitative units, organizations simultaneously perform both activities and balance them within their boundaries through active integration of the senior-management teams (Jansen et al., 2009)....

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Journal ArticleDOI
TL;DR: Overall, this work contributes a more accurate view of how leaders effectively balance between efficiency and flexibility by emphasizing heuristics-based “strategies of simple rules,” multiple environmental realities, and higher-order “expert” cognition.
Abstract: Our purpose is to clarify the microfoundations of performance in dynamic environments. A key premise is that the microfoundational link from organization, strategy, and dynamic capabilities to performance centers on how leaders manage the fundamental tension between efficiency and flexibility. We develop several insights. First, regarding structure, we highlight that organizations often drift toward efficiency, and so balancing efficiency and flexibility comes, counterintuitively, through unbalancing to favor flexibility. Second, we argue that environmental dynamism, rather than being simply stable or dynamic, is a multidimensional construct with dimensions that uniquely influence the importance and ease of balancing efficiency and flexibility. Third, we outline how executives balance efficiency and flexibility through cognitively sophisticated, single solutions rather than by simply holding contradictions. Overall, we go beyond the caricature of new organizational forms as obsessed with fluidity and the simplistic view of routines as the microfoundation of performance. Rather, we contribute a more accurate view of how leaders effectively balance between efficiency and flexibility by emphasizing heuristics-based “strategies of simple rules,” multiple environmental realities, and higher-order “expert” cognition. Together, these insights seek to add needed precision to the microfoundations of performance in dynamic environments.

621 citations


Cites background from "Structural Differentiation and Ambi..."

  • ...…and flexibility are contradictory choices that require mutually exclusive solutions that support either efficiency or flexibility (Duncan 1976, Jansen et al. 2009, Lubatkin et al. 2006, Raisch and Birkinshaw 2008, Raisch et al. 2009, Tushman and O’Reilly 1996; see also the Organization…...

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  • ...Finally, regardless of whether ambidexterity is spatial or temporal, senior executives ultimately must integrate the contradictory cognitive agendas of efficiency and flexibility (Gilbert 2006, Smith and Tushman 2005) through mechanisms such as contingent awards for senior teams (Jansen et al. 2009) and education (Taylor and Helfat 2009)....

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  • ...…is spatial or temporal, senior executives ultimately must integrate the contradictory cognitive agendas of efficiency and flexibility (Gilbert 2006, Smith and Tushman 2005) through mechanisms such as contingent awards for senior teams (Jansen et al. 2009) and education (Taylor and Helfat 2009)....

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References
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416 citations


Additional excerpts

  • ...2004, Lubatkin et al. 2006). Combining exploration and exploitation not only helps organizations to overcome structural inertia that results from focusing on exploitation, but also refrains them from accelerating exploration without gaining benefits (Levinthal and March 1993). Although both types of activities are important for organizational survival, they create paradoxical challenges. Whereas exploration results from experimentation, flexibility, and divergent thinking, exploitation is associated with efficiency, refinement, and focus (March 1991). In this study, we apply the distinction between exploration and exploitation to learning and innovation, albeit of different types. Prior studies such as Benner and Tushman (2003), Danneels (2002), and He and Wong (2004) have explicitly embraced the idea that exploratory innovations are designed to meet the needs of emerging customers or markets....

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Journal ArticleDOI
TL;DR: In this paper, the authors examined the joint effects of task interdependence and reward interdependency on group behavior and performance, and developed a model that predicts that task and reward-interdependent individuals will interact to increase performance.
Abstract: We examine the joint effects of task interdependence and reward interdependence on group behavior and performance. We develop a model that predicts that task and reward interdependence will interact to increase performance, and present results of a laboratory experiment that confirms our prediction. We explore the efficacy of group reward systems for different task designs, and the relationship between cooperation and performance. We confirm earlier results on the weakness of the free-rider effect in small face-to-face groups. We also find, surprisingly, that while reward interdependence is important to performance, task interdependence, but not reward interdependence, drives observed cooperative behavior. This last result suggests caution in interpreting the efficacy of changes in the design of work. Such changes, if unaccompanied by changes in the design of the reward system, are likely to appear successful in terms of observed cooperation, but may not enhance performance. © 1997 by John Wiley & Sons, Ltd.

413 citations


"Structural Differentiation and Ambi..." refers background in this paper

  • ...Structural differentiation refers to “the state of segmentation of the organizational system into subsystems, each of which tends to develop particular attributes in relation to the requirements posed by its relevant external environment” (Lawrence and Lorsch 1967, pp. 3–4)....

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Journal ArticleDOI
TL;DR: In this paper, the authors use a systematic review to develop a research framework which integrates intellectual capital resources (organizational, social and human capital) across various levels of analysis (organization, group and individual).
Abstract: Ambidexterity is of central importance to the competitive advantage of the firm, yet to date there is limited understanding of how it is managed. The theorization of ambidexterity is inadequate for complex, practical realities and, in turn, this hinders the way in which it can aid the management of ambidexterity in practice. This paper asks: What are the mechanisms for achieving ambidexterity? The authors use a systematic review to develop a research framework which integrates intellectual capital resources (organizational, social and human capital) across various levels of analysis (organization, group and individual). This review extends understanding of the generic mechanisms (i.e. temporal, structural and contextual ambidexterity) that dominate the literature. This allows for a more fine-grained understanding of how ambidexterity is achieved and enables avenues for further research to be identified.

403 citations

Journal ArticleDOI
TL;DR: In this article, the authors report on a field study of top management teams and examine four managerial levers that can help executives overcome the cognitive, emotional, and political barriers to engaging in conflict.
Abstract: Substantive conflict is natural within top management teams as executives struggle with making high-stakes choices under conditions of ambiguity and uncertainty. Yet, many top management teams fail to sufficiently debate appropriate courses of action. This article reports on a field study of top management teams and examines four managerial levers that can help executives overcome the cognitive, emotional, and political barriers to engaging in conflict. These levers are: build a heterogeneous team; create frequent interactions within that team; cultivate a distinct symphony of roles such as Counselor, Futurist, and Ms. Action around fundamental tensions within managing; and use multiple-lens tactics such as competitor role playing and multiple alternatives to provide unexpected vantage points on key issues.

400 citations


"Structural Differentiation and Ambi..." refers background in this paper

  • ...Social integration increases collaborative problem solving (De Cremer et al. 2008) and facilitates senior executives to build realistic understandings of key preferences and conflicting roles in senior teams (Eisenhardt et al. 1997)....

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  • ...Especially when senior team members are responsible for differentiated exploratory and exploitative units, the likelihood of conflict is further exacerbated (Eisenhardt et al. 1997, Tushman and O’Reilly 1996)....

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  • ...2008) and facilitates senior executives to build realistic understandings of key preferences and conflicting roles in senior teams (Eisenhardt et al. 1997)....

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Journal ArticleDOI
TL;DR: This study examines the interactive effect of technological intensiveness and top management group (TMG) pay disparity on firm performance and constructs seven different measures of executive pay disparity based on three major types of pay disparity and uses a proprietary data set to test the hypotheses.
Abstract: This study examines the interactive effect of technological intensiveness and top management group (TMG) pay disparity on firm performance. Drawing on two literatures--task interdependence and group rewards--we argue that: (a) technological intensiveness imposes a considerable requirement for multiway information processing and collaboration among senior executives of a firm, and (b) collaboration is diminished when large pay disparities exist. Hence, TMG pay disparity should be more detrimental to subsequent performance of high-technology firms than low-technology firms. We construct seven different measures of executive pay disparity based on three major types of pay disparity (vertical, horizontal, and overall) and use a proprietary data set to test our hypotheses. The results provide consistent support for our hypotheses, thereby suggesting important implications for scholars and designers of executive compensation.

395 citations


"Structural Differentiation and Ambi..." refers background in this paper

  • ...It establishes differences across organizational units in terms of mindsets, time orientations, functions, and product/market domains (Lawrence and Lorsch 1967, Golden and Ma 2003)....

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