Intraorganizational Factors

The development of an enterprise depends largely on its potential, which determines the capacity, abilities, and efficiency or competence inherent in the company’s resources as well as the ability to use the environment’s resources (Lichtarski, 2003, p. 122). In the current research, various internal factors contributing to the ambidexterity of enterprises were analyzed, which is synthesized in Table 2.2.

Taking into account the diversity of internal factors of the ambidexterity concept and attempting to systemize them, three key intraorganizational groups of antecedents to selecting a company development strategy were distinguished for the purpose of this work are:

  • • resource conditions—related to the access to strategic resources, existing slack resources, and co-dependence of resources;
  • • structural conditions—related to the organizational structure and differential and integration mechanisms of organizational units;
  • • behavioral context—comprising processes, systems, values, and beliefs.

Table 2.2 Examples of Internal Factors Determining the Ambidexterity of an

Enterprise

Factor

Analyzed issues

References

Resources

Strategic importance of resources;

resource interdependence; slack resources

(Jansen, Simsek, 6c Cao, 2012; Judge 6c Blocker, 2008; Kouropalatis, Hughes, 6c Morgan, 2012; Siren, Kohtamaki, 6c Kuckertz, 2012; Voss, Sirdeshmukh, 6c Voss, 2008)

Organizational

structure

Structural differentiation; centralization/ decentralization; coordination and integration mechanisms; formalization

(Jansen et ah, 2009; Jansen, Van den Bosch, 6c Volberda, 2006; Tushman et ah, 2010)

Organizational

culture

Organizational diversity; standards and values; company identity

(Sorensen, 2002; Tripsas, 2009; Wang 6c Rafiq, 2014)

Behavioral

context

Discipline; scope of tasks; social support; trust

(Chandrasekaran, Linderman, 6c Schroeder, 2012; Gibson 6c Birkinshaw, 2004; Giittel 6c Konlechner, 2009; Simsek et ah, 2009)

Intellectual

capital

Social capital; human capital; organizational capital

(De la Lastra et ah, 2017; Kang 6c Snell, 2009)

Quality

management

system

Quality;

process management; customer satisfaction; empowerment; synergy;

TQM practices

(Asif 6c de Vries, 2015; Luzon 6c Pasola, 2011; Zhang, Linderman, 6c Schroeder, 2012)

Information and control systems

Data and information analysis;

control mechanisms; projects

(Tiwana, 2010)

Absorption

capacity

Absorption; assimilation; innovation; external knowledge; learning

(Enkel et ah, 2017; Jansen, 2005; Lavie, Stettner, 6c Tushman, 2010)

Age and size of the organization

Age of the company; size of the company; control variables

(Herhausen, 2016; Lavie, Stettner, 6c Tushman, 2010; Lin et ah, 2013; Sok 6c O’Cass, 2015; Wei, Zhao, 6c Zhang, 2014)

In addition, also the age and size of an enterprise were taken into consideration.

It should also be stated that separate research was focused on conditions related to management staff, in particular, top management (e.g., Bratnicka, 2017; Carmeli & Halevi, 2009; Mihalache et ah, 2014; Raisch & Birkinshaw, 2008). However, due to their key role in an organization achieving ambidexterity, the abilities of the management, as well as leadership, although they are internal in nature, were distinguished as a separate antecedent group and discussed in the next subchapter.

Resources

The resource-based view1 defines an organization as an entity comprising various resources and is related to the belief that the capacities of enterprises to operate and develop are a derivative of key competences or distinctive abilities held and do not result from the condition of the environment (Barney, 1991).

Generally, resources are perceived as what contributes to the achievement of the organization’s objectives, and these resources may be tangible or intangible, they may be purchased at resource market or created in-house by the organization, and they may or may not be owned by the organization (Grant, 2016). Therefore, resources may cover anything owned or controlled by the organization and what comprises the basis of its operation, as a result of which useful values addressed to specific customers are created. At this point it should be noticed that what an organization “owns” (e.g., reputation, technological infrastructure, IT system, other tangible fixed and current assets) are referred to as resources (assets), whereas, what an organization “knows” and what is required for its operation is referred to skills (capabilities) (Rokita, 2005, p. 139). Exceptional combinations of knowledge, capabilities (skills), and other resources that are difficult to imitate by competitors and that generate value are referred to as core competences2 (Prahalad & Hamel, 1990, p. 83), or distinctive capabilities5 (Kay, 1995, p. 29). They are the source of competitive advantage of a company, especially if they allow the company to identify opportunities and reconfigure resources for the purpose of their use, that is, they are dynamic skills in nature, which are difficult to copy and are equifinal, homogeneous, and durable (Teece, Pisano, & Shuen, 1997; Ambrosini & Bowman, 2009).

When searching for the sources of competitive advantage, one should concentrate on heterogeneous and non-mobile resources (Barney, 1991) because not all resources demonstrate the same competitive advantagebuilding potential. The competitive advantage of a company is assured by strategic resources, which are as follows (Barney, 1991; Rokita, 2005; Sigismund Huff et al., 2008):

• valuable—because they allow an enterprise to operate efficiently and

adapt to the environment, and facilitate the manufacture of unique products, yielding unique useful value for customer;

  • • scarce—because they are not widely available on the market and their substitution is limited;
  • • difficult to imitate—that is, copy by competitors, thanks to which they assure a durable competitive advantage;
  • • well-organized—which allows the company to use them efficiently through formal structures, control systems, or functional policies;
  • • flexible—which means that they can be adjusted to new situations;
  • • uncapturable—in which case the profits they generate cannot be captured by others.

The first four features protect an exceptional, distinctive dimension of resources. Flexibility is significant from the point of view of a modern, highly volatile environment because organizations that adapt to new conditions and circumstances quicker and/or are ahead of them stand a greater chance of gaining a competitive advantage. On the other hand, uncapturability indicates whether or not an organization uses the value or revenues generated by resources. Features of strategic resources are demonstrated primarily by intangible resources, including knowledge (Hult et al., 2006) and relational resources (Arya & Lin., 2007; Zakrzewska- Bielawska, 2019).

From the ambidexterity perspective, enterprises use their strategic resources to expand their product and market domain and to improve operating efficiency (Hoopes, Madsen, & Walker, 2003; Wassmer, Li, & Madhok, 2017). However, this type of resources is usually limited, and companies must make decisions regarding their adequate allocation and re-allocation in these different activities (O’Reilly & Tushman, 2008). This is primarily influenced by the availability of resources (Gilbert, 2005), analyzed not only from the perspective of having them but also from the perspective of the opportunity to acquire them (Gupta, Smith, & Shalley, 2006) through cooperation and coopetition in alliances or interorganizational networks (Stanczyk-Hugiet, 2013; De Resende et ah, 2018), thanks to which organizations may use resources they do not have and are not able to purchase or manufacture, which, on the other hand, results in resource-based interdependence.

Resource availability depends on environmental munificence. In this respect, environmental munificence may be perceived in the category of resource scarcity or resourcefulness (Castrogiovanni, 1991). In a munificent environment, companies acquire the resources they need more easily and at lower cost (Dess &c Beard, 1984), which has an impact on the ambidexterity capacity. The research of Cao, Gedajlovic, and Zhang (2009) conducted in 122 high-tech companies located in three technology parks in China shows that when companies operate in conditions of limited access to resources (internal and external), the ambidextrous strategy, based on balancing the exploration and exploitation activities, yields better results, and when companies have broad access to the necessary resources, better results are achieved if an ambidextrous strategy based on simultaneous maximization of exploration and exploitation is employed. On the other hand, Li et al. (2013) demonstrated that environmental munificence contributes to the strengthening of the learning effect in the area of exploration and the deterioration thereof in the scope of exploitation. Similar conclusions were made by other researchers, who indicate that the “ambidexterity” capacity depends on the availability of necessary resources (Raisch & Birkinshaw, 2008), and differences in this access may affect the efficiency of the implementation of the ambidextrous strategy (Kyriakopoulos & Moorman, 2004; Venkatraman, Lee, & Iyer, 2007).

Resource availability is related to the slack resources category, which is also indicated as an antecedent to the ambidexterity concept (Lavie, Stettner, & Tushman, 2010). Slack resources are understood as the difference between resources currently held by a company and its resources needed for day-to-day operation (Mishina, Pollock, &C Porac, 2004). In other words, the term determines the excess of resources available for an enterprise beyond those that are required for ordinary day-to-day operation (Nohria & Gulati, 1996). Slack resources may include absorbed and unabsorbed resources (Voss, Sirdeshmukh, & Voss, 2008), or available, renewable, and potential resources, in which case they are referred to as organizational slack (Cheng & Kesner, 1997).

Earlier research focused on the importance of slack resources in attempting to undertake both exploration and exploitation activities. It was demonstrated, inter alia, that the absorbed general resources are related to increased exploitation and lower exploration, and unabsorbed resources, both general and scarce, result in higher exploration and lower exploitation but only when threats in the environment are regarded as strong (Voss, Sirdeshmukh, & Voss, 2008). Moreover, slack resources, by allowing the acquisition of necessary resources, minimize political games within the organization, contribute to training of employees who gain new skills, boost trust in managers, and help reward employees for high productivity as well as risk-bearing innovations. Therefore, a high level of slack resources bolsters the relation between the organization’s capacity to change and ambidexterity, and a low level can deteriorate this relation (Judge & Blocker, 2008). Slack resources have an impact on creativity and allow organizations to undertake exploration activities even if, in the short term, they do not yield measurable results (Bledow et al., 2009), and the total absence of slack resources leads to a drop in creativity and innovative initiatives undertaken by employees (Frese, Garst, & Fay, 2007). In other words, slack resources encourage organizations to make most of the opportunities, which contributes to their growth, but on the other hand, the availability of slack resources may indicate the company’s inefficiency in using its resources, which in turn has a negative impact on the company’s financial results (Kauppila, 2010). It was also noticed that the simultaneity of exploration and exploitation activities reduces the level of slack resources (Jansen, Van den Bosch, &c Volberda, 2006).

Slack resources are particularly important in the area of financial resources because these extra funds may be earmarked for exploration and exploitation activities that are more effective and better adapted to market needs (Sirmon, Hitt, & Ireland, 2007), and with lower funds, ambidextrous businesses are exposed to higher risk, which may cause a drop in results (Lin, Yang, & Demirkan, 2007). Moreover, wherever slack resources are available, internal organizational units (responsible for exploration and exploitation) are less aggressive in competing with one another for the organization’s resources and control over them (Jansen, Simsek, & Cao, 2012). Hence, it may be concluded that the level of slack resources considerably determines the selection of ambidextrous strategy.

Finally, a vital feature of resource conditions is resource-based interdependence, not only within the framework of access to complementary and common resources through cooperation and coopetition (Lavie, 2006), but also within a given organization, when one unit depends on the resources of another, which may trigger conflict and intensify the need for adequate coordination. Resource-based interdependence creates a risk that the enterprise may not have adequate resources at its disposal to allow effective exploration and exploitation in the specific period. Jansen, Simsek, and Cao (2012) surveyed 285 organizational units located in 88 Dutch, autonomous branches of a large European financial service provider and noticed that resource-based interdependence reduced the efficiency of ambidextrous units because it required a great deal of interaction between interdependent units, anticipation of their activities and needs, and adaption of their own exploration and exploitation activities to them, as well as adequate coordination. Therefore, resource-based coordination should be regarded as an antecedent to the selection of the ambidextrous strategy, and the lower it is, the better results the enterprise records by following the ambidextrous strategy.

Taking into account the current deliberations, joint access to resources and related slack resources, as well as resource-based interdependence within and beyond an organization, I have put forward another hypothesis:

H3. Resources at the company’s disposal are positively linked to the selection of the ambidextrous strategy in the sense that (a) the better the access to them and the greater the related slack resources and (b) the lower the resource-based interdependence, the higher the company’s inclination to select the ambidextrous strategy.

By managing resources, through building an adequate resource portfolio and efficient use thereof, an enterprise is able to generate value for stakeholders based on the current competence and development of various new abilities and skills. In other words, it is able to effectively implement the ambidextrous strategy. However, apart from resource-related attributes, structural and contextual attributes are also an important element determining its effectiveness, because, as earlier research showed (e.g., Birkinshaw &c Gibson, 2004a; Tushman & O’Reilly, 1996), managers must build adequate organizational structures and develop adequate processes, systems, and values that will support the activities and behaviors of ambidextrous companies.

Organizational Structure

Structural conditions of a given organization are expressed through the composition and features of its organizational structure, understood most often as a system of elements comprising a whole and their mutual relations (Zakrzewska-Bielawska, 2011). Its essence consists of the appropriate combination of goals and tasks of the organization, resulting from the strategy and technology of executive processes, with people and how they are affected in the work process. When putting the elements of an organization’s system in order and coordinating the work of people, the organizational structure contributes to the reduction of uncertainty and improvement of decision-making processes. Therefore, it is a management tool (Flaszewska, 2016) that not only determines the framework of organizational activities (executive and management) but also assures efficient implementation of objectives of the enterprise and regulating the activities of individual employees and teams to ensure the achievement of a specific level of satisfaction of needs. At this point it should be remembered that the organizational structure is not designed once and for all, it is subject to dynamic changes as a result of the impact of structure-building factors, including most of all environment, strategy, technology, organizational culture, needs for power, and development of employee competences (Burton, Obel, & Hakonsson, 2020; Daft, 2007). Strategy is of particular importance among them, because on the one hand, the organizational structure should be adjusted to the adopted strategy so that the latter can be efficiently implemented (structure follows strategy) (Chandler, 1962) and on the other hand, the organizational structure strongly affects the strategic process; therefore, it determines its selection (strategy follows structure) (Ansoff, 1979; Hall & Saias, 1980). Moreover, as Felin and Powell (2016) add, in the case of dynamic skills, which include ambidexterity, it is not important whether structure follows strategy or the other way round, the key issue is the continuous orchestration of strategies and structures reflecting their interactions and allowing the identification, forming, and using market possibilities and opportunities.

It should also be added that the impact on the organizational solutions of a given enterprise is exerted by its size, age, and stage of development or the industry in which it operates. Therefore, there are no two identical organizational structures because there are no two identical organizations, and any attempt to classify them is a certain simplification that helps understand complicated phenomena and interactions occurring between members of the organization (Zakrzewska-Bielawska, 2011). Most frequently, organizational structures are described through their specific properties (features) which, on the one hand, constitute design- related dilemmas related to the shaping thereof, and on the other hand, criteria of analysis and assessment of the organizational solution of an enterprise. The most common is the proposal of the Aston school, in line with which the basic features of an organizational structure include the following: specialization, standardization, configuration, centralization, and formalization (Pugh &C Hickson, 1976), which jointly determine its flexibility (Verdu & Gomez-Gras, 2009). Moreover, due to the wide collaboration of modern enterprises, especially in the network environment (Borgatti & Foster, 2003; Fowler & Reisenwitz, 2013), networking is also an important feature of an organizational solution, being understood as the durability of the network system in which the organization operates, and its complexity, determined by the position in the network, the number of partners, and method of coordination (Zakrzewska-Bielawska, 2016b).

Organizational design from the ambidexterity perspective is a dilemma because some structural features are favorable to exploration and others to exploitation. Many studies (e.g., Duncan, 1976; He & Wong, 2004; O’Reilly &C Tushman, 2011; Raisch, 2008; Tushman et al., 2010) have shown that organic solutions—that is, flat and horizontal organizational structures, loosely structured and decentralized, with a multidirectional flow of information and horizontal coordination, poorly formalized and highly flexible—are favorable to creative activities oriented at experimentation and radical innovation, that is, exploration activities. Whereas structures with more mechanical features—that is, higher standardization and specialization, centralized and formalized, with dominating vertical coordination and clearly defined scope of tasks and responsibilities—are favorable to higher efficiency, productivity, and effectiveness of activities, that is, exploitation, organizational structures that allow the implementation of both types of activities are eclectic structures of heterogeneous features. Thus, the organizational structure is perceived as an important antecedent underlying the selection of the ambidextrous strategy.

The most recent studies show that spatial separation (structural ambidexterity) is favorable to the implementation of the ambidextrous strategy because it assumes the creation, on the level of organization or a business unit, separate structures for non-routine exploration activities and routine exploitation activities, thanks to which these activities are physically separated and require integration by top management (Benner & Tushman, 2003; Kortmann, 2012; Mom, Van Den Bosch, & Volberda, 2009; Tushman & O’Reilly, 1996). Such a spatial separation treats exploration and exploitation activities as orthogonal (Gupta, Smith, & Shalley, 2006), which permits simultaneous implementation (Gilbert, 2005; Jansen et al.,

2009). Structural separation is also expressed by parallel structures (Chen, R. R., & Kannan-Narasimhan, R. R, 2015; McDonough & Leifer, 1983; Raisch, 2008), which assume the use of primary and secondary structures to implement key tasks. The primary structures help maintain the stability of the organization and incremental innovations, whereas secondary structures are oriented at exploration activities, including new markets and products through the use of design teams and networks. The hypertext structure (Nonaka & Takeuchi, 1995) is similar in nature to the parallel structure. It takes into account two systems: the first one is a hierarchical structure (based on a functional organizational structure), which stabilizes the operation of the organization and the second one is made up of non-formalized design teams, the members of which are appointed from various units of the stable system. The first system is favorable to the implementation of routine and repetitive activities that do not require a creative approach. The second one is characterized by high flexibility of design teams, which makes it easier to create new knowledge, stimulate creativity, and allow the members to develop their skills.

In relation to the aforementioned discussion, a key issue in the spatial separation is the structural differentiation of tasks and coordination and integration mechanisms, which is also related to an adequate level of centralization and formalization of the organizational structure.

The current results of studies in this area show that centralization has a negative impact on exploration, and formalization creates conditions favorable to exploitation and connectedness, because informal mechanisms of coordination are conducive to both exploration and exploitation (Jansen, Van Den Bosch, & Volberda, 2006). What is more, centralization hinders the simultaneity of both types of activities, and direct contact between members of organizations at various hierarchical levels allows their effective implementation (Mihalache et al., 2014). Formalization does not have to limit exploration activities (Kang &C Snell, 2009), and social relations between employees in various departments facilitate synthesis, assimilation, and use of the current and new knowledge, thus contributing to the development of innovation, both incremental and radical (Atuahene-Gima, 2005). On the other hand, studies of Wei, Yi, and Yuan (2011) performed on a sample of 213 businesses operating in China showed that formalization bolstered the impact of the bottom-up learning on innovative exploitation activities and, at the same time, it can strengthen the positive impact of bottom-up learning on exploration activities through the reduction of complexity and uncertainty of information regarding changes. However, if the level of bottom-up learning is too high, then formalization causes inertia and results in quicker dwindling of the positive effect. In other words, formalization moderates the impact of bottom-up learning on exploration activity in a U-shaped pattern.

Based on research conducted in 243 small- and medium-sized enterprises (SMEs) in Scotland, Chang and Hughes (2012) noticed that the more formalized the organizational structure and the closer the relations between employees, the higher the level of balance between exploration and exploitation activities in the company. On the other hand, Kortmann (2012), having studied 202 top managers from American companies, confirmed that in manufacturing enterprises, the ambidexterity ability to a larger extent depends on the decentralization of strategic decisions and low formalization of routine tasks, whereas in service providers, it is to a larger extent conditioned by the decentralization of operating decisions and formalization of routine decisions.

Surely, spatial separation resulting from the structural differentiation of exploration and exploitation tasks has a direct impact on the ambidexterity level, thus contributing also to the growth in sales (Martini, Neirotti, & Aloini, 2015). However, for a structural separation to bring about expected effects, adequate coordination and integration of those activities are necessary because the absence of structural integration and leaving them to self-organization processes is insufficient and may lead to chaos (Felin &C Powell, 2016). As well as the significant role of management in coordination processes, Jansen et al. (2009) defined the formal and informal integrating mechanisms. These include cross-functional interfaces in the form, for instance, of task forces or liaison positions and connectedness. By analyzing seven cases of large enterprises of considerable technological advancement, Gassmann, Widenmayer, and Zeschky (2012) identified five methods of integrating units oriented at exploration and exploitation activities, such as external validation, liaison roles, and showcasing innovation, which allow the translation of abstract concepts of innovation into artifacts, network building, and integrated innovation planning.

Markides and Charitou (2004) proposed four different organizational solutions in this respect, that is, from full through partial separation, partial integration to full integration, and the selection of one of them depends on the degree of conflict between the new and the latest business models and the need for their synergy. The larger the conflict, the more profitable the separation. Moreover, Markides (2013) identified 26 mechanisms that allow the integration of various business models and the use of which depends on the specificity of the enterprise and dynamics of its environment.

Some researchers also indicate specific organizational solutions dedicated to ambidexterity. For instance, Tushman et al. (2010), based on longitudinal studies in 13 business units of American companies, noticed that the ambidextrous structures based on spatial separation resulted in relatively high capacity of the company to explore and exploit, thus yielding better results in innovation activities. On the other hand, functional structures with cross-functional teams or spin-outs bring about lower innovation effects. Having conducted surveys in 115 companies operating on the American market, De Visser et al. (2010) proved that enterprises that employed a task-based structure while searching for radical innovation in the development of new products generated better results than those with a functional structure. On the other hand, companies with a functional structure gained better results in the new product development process through incremental innovations. Therefore, ambidextrous structures are recommended for entities that develop new products both by radical and incremental innovations.

Research dedicated to structural separation may be classified into three groups of problems (De Paula et al., 2016): (1) organizational design; (2) integration and coordination mechanisms; and (3) assessment of company results from the perspective of the adopted organizational structure, in which these problems are complementary. Most of them refer to the company or business unit level. However, it should be stated that structural separation may occur also beyond the enterprise, as part of collaboration. Studies in this respect show that instead of concentrating only on exploration and exploitation within the company, the ambidexterity concept may be implemented by adapting the external perspective by combining the internal and external processes of knowledge flow, for example, as part of open innovation (Lichtenthaler &C Lichtenthaler, 2009). In this area Stettner and Lavie (2014) identified three models. The first one refers to carrying out exploration and exploitation activities only within a specific enterprise (internal model), and the other assumes the use of alliances (the company gains access to new knowledge through collaboration with partners in an alliance or uses them for commercialization and marketing of new products), whereas the third model takes into account the purchase of exploration or exploitation activities through acquisitions. The researchers claim that external exploration through alliances or acquisitions, and internal exploitation increase the efficiency of an enterprise. Other studies, taking into account the external perspective, concentrated primarily on forming alliances, including partner selection (new vs. current) (Lavie & Rosenkopf, 2006; Lin, Yang, &C Demirkan, 2007) and categorization of the functional scope of an alliance by determining the direction of actions in the value chain (up vs. down) (Yamakawa, Yang, & Lin, 2011). Also, the problem of the simultaneous exploration and exploitation of resources in the context of building an alliance portfolio was raised (Wassmer, Li, & Madhok, 2017). From the network perspective, the studies concentrated, inter alia, on the recognition of network (business and social) exploration and exploitation mechanisms in the context of innovation (Medlin & Tornroos, 2015; Simon 8c Tellier, 2011), openness (Soetanto, 2015), and position in the network or the stretch and strength of relationships of top managers connection with the ambidextrous orientation (Heavey, Simsek, & Fox, 2015).

Apart from structural separation, features of organizational structure at time separation were studied (temporal ambidexterity). For instance, the research of Siggelkow and Levinthal (2003) employing simulation models has demonstrated that the structure using temporal decentralization contributes to the highest organizational efficiency in comparison to the fully centralized or decentralized structure. Wang and Rafiq (2014) indicated that time separation leading to structural changes requires the development of adequate process mechanisms that will allow the transition from exploration to exploitation activities. Brown and Eisenhardt (1997) proposed that companies use partial structurization to transition back and forth between periods of exploitation and exploration. On the other hand, Nickerson and Zenger (2002) as well as Boumgarden, Nickerson, and Zenger (2012), define time separation as vacillation and claim that it yields better results in the long term than ambidexterity acquired by simultaneous exploration and exploitation activities, and they concurrently state that these methods are complementary.

Also, Chen, R. R., &c Kannan-Narasimhan, R. R (2015) indicated the complementarity of time and structural separation from the perspective of organizational design. By analyzing Silicon Valley enterprises, the researchers proposed four archetypes of formal integration of basic business units with new undertakings, for which they stressed that the key factor of selection was the time of integration.

In light of the aforementioned deliberations justifying the importance of organizational structure and its features for reaching ambidexterity by an enterprise, another hypothesis was made:

H4. The organizational structure is positively linked to the selection of the ambidextrous strategy in the sense that: (a) the stronger the structural differentiation of exploration and exploitation tasks, (b) the higher the decentralization of decisions, (c) the lower the formalization of non-routine tasks, (d) the higher the formalization of routine tasks, (e) the stronger the cross-functional interfaces, and (f) the stronger the social relations, then the higher the company’s inclination to select the ambidextrous strategy.

Structural differentiation refers to the scope in which an enterprise invests its exploration and exploitation tasks in separate units, which allows ambidextrous companies to reconcile conflicting requirements (Gilbert, 2005; Raisch &C Birkinshaw, 2008). It was assumed at this point that it refers not only to separation within a specific entity but also to separate allocation of these activities through cooperation with external partners (Stettner & Lavie, 2014). Such a spatial separation is conducive to simultaneous implementation of these tasks (Tushman & O’Reilly, 1996), which also affects company results (iMartini, Neirotti, & Aloini, 2015). Thus, the stronger the structural differentiation, the higher the chances for effective implementation of the ambidextrous strategy and therefore the higher the inclination to choose it. Also, a higher degree of decentralization that influences the speed and quality of information gained is a favorable factor (Mihalache et al., 2014). In centralized organizations, information undergoes a long filtration process in the organizational hierarchy before it reaches the decision-makers (Sheremata, 2000), due to which it may be biased and of low quality. Moreover, centralization hinders the creative thinking processes and therefore may restrict exploration activities. Hence, the higher the degree of decentralization of structure, the higher the inclination to choose the ambidextrous strategy. Finally, formalization determines its selection, and although the results of recent studies are not unambiguous, one can assume that non-routine activities should be characterized by lower formalization because without setting fixed framework and procedures it is conducive to creativity of employees (Gibson & Birkinshaw, 2004). On the other hand, routine activities should be characterized by high formalization because it allows quick solution of the problem and minimizes freedom of behavior (Kortmann, 2012). Moreover, structurally diversified actions, to yield intended results, require proper coordination and integration within an organization. This is supported by cross-functional interfaces, for example, in the form of task forces, which allow the exchange of knowledge between exploration and exploitation units, as well as mutual understanding and agreement, but also strong and thick social relations, which facilitate the exchange of knowledge and reduce the likelihood of conflict between exploration and exploitation units, thus contributing to the development of new applications of existing knowledge (Jansen et al., 2009). Therefore, the scope of cross-functional interface and social relations also affects the choice of the ambidextrous strategy.

Whereas the organizational structure defines the division of tasks and their combination within an organization, that is, it refers to the macrolevel (Raisch et al., 2009), an equally important intraorganizational factor is the micro context, which refers to rules, processes, and values that determine human behavior in an organization. Therefore, another group of antecedents of choosing the ambidextrous strategy are those related to the behavioral context.

Behavioral Context

Behavioral context is directly linked with contextual ambidexterity and complements the structural conditions analyzed at the organizational level with the recognition of systems, processes, values, norms, and beliefs that affect the behavior of employees and either support or hinder their exploration and exploitation activities. Therefore, the context refers to the level of an individual who takes on specific attitudes and behaves in a certain way. Birkinshaw and Gibson (2004b) define context as a set of stimuli and pressures (often invisible), which motivate people to act in an assumed manner. From the ambidexterity perspective, researchers define the behavioral context two-dimensionally, through (1) performance management, which is a combination of discipline and stretch, which is supposed to motivate people to achieve high quality results and is a hard element of management and (2) social support, which is a soft element of management that combines support with trust, which assures the safety and freedom of people, which are required for creative thinking and maximum use of their potential.4 Therefore, the organizational context determines the effectiveness of exploitation activities through the management of efficiency and the effectiveness of exploration activities through social support, thus being an antecedent of the ambidexterity of an organization (Gibson & Birkinshaw, 2004; Simsek, 2009). At this point it should be noticed that the more the systems, processes, values, norms, and beliefs are conducive to performance management and social support (high level of both dimensions), the stronger the behavioral context that is favorable to the ambidexterity of an organization. On the other hand, an imbalance between them may result in the fact that the behavioral context is not optimum for reaching ambidexterity by the organization (Yigit, 2013). Too much pressure on discipline and stretch of tasks may lead to burnout and disappointment among employees, and too much pressure on support and trust will create a country-club atmosphere that prevents efficient work (Gibson &c Birkinshaw, 2004).

The behavioral context does not impose any concrete types of activities, rather it creates a specific environment that inspires employees to take adequate measures from the perspective of the enterprise’s objectives, demonstrating both exploration and exploitation features. The more the behavioral context is defined by the interaction of discipline, stretch, support, and trust, the higher the ambidexterity level.

Taking into account the context, Birkinshaw and Gibson (2004b) distinguished four possible situations, such as country-club context, low- performance context, high-performance context, and burnout context.

The country-club context assures high social support and low discipline and stretch of tasks. Employees gain benefits mostly from the collegial environment; however, their productivity is low, which is not favorable for achieving ambidexterity. Similarly, the burnout context concentrated on high efficiency at low social support does not lead to ambidexterity. In such a context, employees function well for a specific period. Finally, however, its impersonal and authoritarian nature causes high fluctuation of personnel. Absence or low level of both social support and performance management creates a context of low performance. Such a context offers neither the discipline of operation nor the support that individuals need to effectively carry out their tasks. On the other hand, high levels of both social support and performance management build a high efficiency context, good for ambidexterity. This type of context stimulates people to assure high-quality activities thanks to performance management systems, and concurrently it assures social support and security required for continuous work over a long term. The diagnosis of the behavioral context allows the undertaking of measures aimed at such changes, which will provide an environment conducive to simultaneous exploration and exploitation activities.

In the opinion of Wang and Rafiq (2014), social support and performance management refer basically to processes and systems in an organization and, to a lesser extent, to values and cultural norms. Therefore, they propose the supplementation of the behavioral context with two additional elements, that is, organizational diversity and shared vision, which, combined, form an ambidextrous organizational culture.

Concurrently, they define organizational diversity as a set of norms and organizational values that support and tolerate differences and reward diverse opinions, skills, and knowledge of individuals. On the other hand, shared vision is defined as a set of values and organizational norms that promote general active involvement of organization’s members in the development, communication, distribution, and implementation of organizational objectives. Based on research conducted in 150 high-tech companies in the United Kingdom and 242 high-tech entities in China, the researchers have proven that organizational diversity and shared vision support each other by creating a cultural context that influences the integration of exploration with exploitation. Moreover, the capacity of ambidexterity depends on heterogeneous resources, in particular ambidextrous organizational culture, rather than on industry-based or cultural differences.

Taking into consideration the behavioral context, ambidexterity is also analyzed from the point of view of assuring balance between alignment, concentrated on improving results in a short term, and adaptability, focused on the creation of new opportunities in the long term (Gibson & Birkinshaw, 2004). This required adequate systems, practices, values, and norms that allow employees to transition from adjustment to adaptation and vice versa, depending on their needs. Ambidexterity is an outcome of individual decisions made by employees, regarding when to explore and when to exploit. In such cases, it is assumed that both adjustment and adaptability are non-substitution and mutually dependent (Gibson &c Birkinshaw, 2004).

Current research has shown that the behavioral context contributes to the integration of exploration and exploitation activities through the process of organizational learning, thus avoiding the coordination costs incurred in relation to structural separation, or transactional costs incurred in relation to time separation (Simsek et al., 2009). Other researchers also confirmed that an adequate behavioral context yields better results in the implementation of the ambidextrous strategy than structural separation (e.g., Chang, Yang, & Chen, 2009; Kang & Snell, 2009). When analyzing antecedents to ambidexterity in high-tech enterprise from a multi-level perspective, Chandrasekaran, Linderman, and Schroeder (2012) noticed that the behavioral context impact of ambidexterity on the mezzo level, at which it is possible to synchronize (through adjustment and adaptation) strategic decisions with project execution. On the other hand, Sok and O’Cass (2015), having researched 150 technologically advanced manufacturing companies from India (based on data acquired both from management and R&D department directors in each entity), proved that the concentration of R&D solely on creative activities resulted in too many risky ideas, and if they focused on details and efficiency, a deficit of new ideas was noted in the organization. Thus, both approaches reduce the particular contribution of individuals in the development of innovation and achieving better financial results. However, if individuals engage in both creative and performance-oriented activities, it results in higher innovation and better financial results, and at the same time it requires adequate behavioral context.

Moreover, it was indicated that the behavioral context is a mediator in the relation between environment’s dynamics and ambidexterity (Dutta, 2013b), facilitates the transfer of knowledge between exploration and exploitation, that is, between projects dedicated to generation of knowledge and those responsible for direct application of knowledge (Giittel & Konlechner, 2009), and affects innovative ambidexterity determined by the level of radical and incremental innovations (Martini, Neirotti, & Alo- ini, 2015). Concurrently, it was noticed that if an enterprise has a limited number of employees or if the time pressure is too high, the contextual ambidexterity does not apply (Yigit, 2013).

In light of the aforementioned deliberations, the behavioral context covering the sets of various stimuli pairs and resulting from their multiplicative interaction is an important antecedent to choosing the ambidextrous strategy, while its impact is reflected on the level of an individual employee through the creation of an environment for ambidextrous work. Therefore, the following hypothesis was made:

H5. The organizational context is positively linked to the selection of the ambidextrous strategy in the sense that: (a) the higher the level of both social support and performance management, (b) the higher the organizational diversity and the more shared vision, (c) the more the organizational systems are conducive to both adjustment and adaptation, then the higher the company’s inclination to select the ambidextrous strategy.

On the one hand, the behavioral context adds the level of the individual to the resource and structural conditions, but on the other hand, it depends on them because shaping the environment for simultaneous exploration and exploitation work requires adequate slack resources and effective mechanisms to integrate these activities, which will assure proper organizational solution. Therefore, this type of antecedents to the ambidexterity concept should be taken into consideration jointly, by making a multi-level analysis. In addition, intraorganizational factors that determine the selection of the ambidextrous strategy are the age and size of an enterprise.

Size and Age of the Company

Enterprises can be divided into micro, small-, medium-sized, and large according to their size. The size of an entity is determined primarily by the number of employees and financial data, that is, total assets or annual turnover, which was specified in the European Commission Regulation 800/20085 (Official Journal of the European Union L 214 of 6 August 2008). As well as formalized quantitative criteria, there also are qualitative criteria that differentiate the specificity of large enterprises from others, which are referred to as the sector of SMEs. Among them, the following are often included: domination of the entrepreneur and their personality in small entities; the specific type of financial economy, which at the founding stage is based on the savings of the entrepreneur-owner and their family; simplified and informal organizational structure; high flexibility of operation and ability to quickly respond to changes in the environment; specific system of personnel selection, based only on recommendations and family contacts; difficulties in benefiting from economies of scale and relatively small market share (Lachiewicz, Matejun, 2012). Due to the nature of smaller entities, especially micro companies, which is manifested primarily by restriction of resources, poorer market position, or lower accumulated knowledge, the concept of ambidexterity is rarely used, and the analyzed entities included mainly large- and medium-sized enterprises (Bratnicka, 2017; Jansen, Simsek, & Cao, 2012). In the case of small enterprises (Lubatkin et al., 2006; Voss & Voss, 2013), it is indicated that they achieve higher efficiency when they employ pure exploration or exploitation strategies (Ebben & Johnson, 2005).

In recent studies of ambidexterity, the size of an enterprise was measured mainly by the number of employees,6 mostly in a logarithmic approach, and treated primarily as a control variable. The results of most studies demonstrate the impact of the enterprise’s size on the use of the ambidextrous approach. For example, it was identified that smaller organizations usually do not have such mechanisms as slack resources or hierarchical administration systems in place, which help larger companies achieve ambidexterity (Buyl, Boone, &C Matthyssens, 2012; Lubatkin et al., 2006). On the other hand, large organizations have limited flexibility, which makes it difficult for them to explore and exploit simultaneously (Alexiev et al., 2010). Moreover, it was established that exploration has a stronger impact on company results as it grows bigger, whereas the larger the enterprise, the smaller the impact of exploitation on the enterprise’s results (McDermott & Prajogo, 2012). Taking into consideration methods to achieve ambidexterity, it was also noticed that a balanced approach (keeping equal proportions between exploration and exploitation) yields better results in smaller companies, and a combined approach (assuming a high level of exploration and exploitation, not necessarily in equal proportions) results in higher efficiency in larger enterprises (Cao, Gedajlovic, &C Zhang, 2009). On the other hand, other researchers did not find major differences in the application of the ambidexterity strategy due to the size of an enterprise (e.g., Herhausen, 2016; Lin et al., 2013), while the company size was regarded as a control variable.

Another factor, closely related to the size of entity, is its age. The age of an enterprise is defined by the number of years it has operated on the market, and in this respect researchers usually employ the logarithmic value. Recent studies show that older companies are more likely to exploit than younger ones (Gilbert, 2005) but also have higher internal inertia (Li, 2014) and structural maturity (O’Reilly & Tushman, 2013), which in turn makes them more inclined to choose the ambidextrous strategy. What is more, research on the longevity of organizations shows that the skill of management in paradox conditions, which the ambidexterity paradox certainly belongs to, is one of the key determinants of the company’s durability (Witek-Crabb, 2017), and thus enterprises with more years on the market should manifest a better ability to handle exploration and exploitation simultaneously. On the other hand, it is also indicated that younger companies, thanks to higher flexibility, find it easier to operate in an ambidextrous manner (Martini, Neirotti, & Aloini, 2015). Therefore, the research results are diverse also in this case.

Despite ambiguity of research conclusions, surely the size and age of an enterprise affects the nature of strategic management, and therefore the selection of strategy. Assuming that larger and older companies have adequate resources to handle exploration and exploitation activities, as well as have experience in paradox management, another hypothesis can be made:

H6. The (a) larger and (b) older the enterprise, the higher the company’s inclination to select the ambidextrous strategy.

Individual intraorganizational conditions related to resource-based potential, organizational structure, context that builds a work environment, and the age and size of the enterprise should be considered jointly because not only is their separate impact material, but also their mutual interactions, which, combined, determine the strategic choices, including decisions on the implementation of the ambidextrous strategy. Such a decision is made by top management, and therefore the next group of antecedents to choose the ambidextrous strategy includes factors related to the experience, knowledge, and abilities of the management as well as leadership oriented at the implementation of strategic exploration and exploitation activities. Further deliberations concern such conditions.

 
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