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Structural Differentiation and Ambidexterity: The Mediating Role of Integration Mechanisms
05 Nov 2008-ERIM report series research in management Erasmus Research Institute of Management (Erasmus Research Institute of Management)-
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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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
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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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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TL;DR: In this paper, design solutions are not sufficient to strategically manage the tensions key to long-term organizational survival, and managing the competing demands of exploration and exploitation represent a fundamental challenge.
Abstract: Are design solutions sufficient to strategically manage the tensions key to long-term organizational survival? Managing the competing demands of exploration and exploitation represent a fundamental...
14 citations
25 Aug 2017
TL;DR: In this article, the authors explored the cognitive dimension of the various dualities that especially managers confront when making decisions, which is defined as the ability to engage in parallel mental processes that are paradoxical or contradictory.
Abstract: Päivi Karhu Lappeenranta 2017 171 pages Acta Universitatis Lappeenrantaensis 756 Diss. Lappeenranta University of Technology ISBN 978-952-335-108-0, ISBN 978-952-335-109-7 ISSN-L 1456-4491, ISSN 1456-4491 This doctoral thesis addresses the cognitive dimension of the various dualities that especially managers confront when making decisions. The study demonstrates how similar decision-making situations can be perceived differently: where one decisionmaker may identify a challenge, another may find a way to channel tensions toward creative purposes. The two distinct yet interrelated literature streams of dualities and organizational ambidexterity have recognized the need for managers to respond to conflicting internal and external demands, which exposes them to a myriad of cognitive challenges. This thesis contributes to the discussion by building a framework of cognitive ambidexterity, which is defined as the ability to engage in parallel mental processes that are paradoxical or contradictory. Whereas duality scholars have been interested in the relationship of the poles of the dualities calling those for instance paradoxes and dilemmas, ambidexterity scholars have discussed the organizations’ ability to manage the opposing demands of exploration and exploitation – which is one type of duality discussed in this thesis – through spatial, temporal or contextual and behavioral solutions. Thus far, little exploration has been done about micro-foundations of ambidexterity and the cognitive processes related to dualities in decision-making. The aim of this thesis is to understand the micro-foundations of dualities, and the strategies that enable managers to handle the opposite demands of such decision-making pairs. To do this, the study draws from managerial cognition literature, which helps to explain how decision-makers identify, assess and cope with dualities and the tensions that arise from the incompatibilities within them. Altogether this study suggests that cognitive ambidexterity can fill a gap that is acknowledged across different research fields—namely, the lack of understanding about the micro-foundations of dualities like paradoxes and dilemmas, which is a limitation that may preclude the achievement of organizational ambidexterity. In addition to providing a conceptual illustration of cognitive ambidexterity, this thesis explores the identified research gaps empirically with qualitative and experimental methods. The qualitative studies operationalize and extend a widely cited tension framework, and test analogical reasoning in the context new product development, providing insights on different types of dualities and creative ways of coping with them. The laboratory experiment appears to be the first to explore decision-makers’ performance in facing dualities that have varying levels of cognitive complexity and their preference regarding dilemma or paradox solutions; it also sheds light on the opportunities and challenges related to different types of dualities. Extant literature on dualities and individual ambidexterity often highlights the superiority of simultaneous paradoxical solutions as opposed to dilemma solutions; this study showcases the usefulness of separate and sequential coping mechanisms in the light of cognitive demands. Altogether this study illuminates the cognitive dimension of decision-making by merging knowledge from distinct literature on dualities, organizational ambidexterity and managerial cognition; it addresses that business environments are, and will continue to be, characterized by dualistic demands. This thesis suggests that through active awareness of the unconscious cognitive processes that hinder or aid decision-making, managers can break from path-dependent patterns, reframe perceived threats to potential business opportunities and build ambidexterity into organizations in a way that prepares them to respond optimally to the dualities that they become inevitably confronted with.
14 citations
TL;DR: In this article, the authors focus on how SME alliances can handle the dilemma of exploration and exploitation to achieve an advantage in terms of financial performance, using the concept of ambidexterity.
Abstract: Small and medium‐sized enterprises (SMEs) deal with many challenges that threaten their survival every day. To successfully overcome these challenges, SMEs rely on strategic alliances. Drawing on the innovative concept of ambidexterity, this study focuses on how SME alliances can handle the dilemma of exploration and exploitation to achieve an advantage in terms of financial performance. A sample of 9,673 Italian SMEs aggregated in 1,854 alliances in the period 2010–2015 was used to test the hypotheses, referring to the moderating effect of corporate sustainability on the relationship between ambidextrous strategies and alliance performance. The results show that, in general, SME alliances that do not set sustainability goals prefer a focused alliance to achieve economic benefits; otherwise, if sustainability objectives are considered at the bases of the alliance formation, the greatest economic benefits are linked to an ambidextrous alliance.
13 citations
TL;DR: In this article, a model that explains the proactive marketing responses to population aging is presented, showing that a company's strategic flexibility not only serves as a direct driver to both explorative and exploitative capabilities and proactive marketing response, but also imparts a far-reaching indirect effect on the marketing response.
13 citations
13 May 2011
TL;DR: In this article, the authors develop an ambidexterity perspective of process management's influence on organizational adaptation and argue that business process practices must simultaneous emphasize process efficiency and process flexibility.
Abstract: We develop an ambidexterity perspective of process management's influence on organizational adaptation. Drawing upon the idea that dynamic capabilities are process-based competence of firms and are rooted in both exploitative and explorative activities, we argue that business process practices must simultaneous emphasize process efficiency which is beneficial for organizations in stable context and process flexibility which should be pay more attention as environment changes more rapidly. We develop a model to explain how organizational IT capabilities and complementary business process management capabilities will help to build up an ambidextrous state in business process activities.
13 citations