Introduction
A company’s ability to implement the processes of exploration and exploitation simultaneously
and also maintain a balance between the two processes is referred to as organization
ambidexterity.
Exploration is mostly supported by radical innovations that develop different products through
experimentation and risk taking operations in pursuit of new discoveries that would result in
customer satisfaction, flexibility of alternatives, variations and legitimization of different
processes that would benefit the organization as illustrated by March (1991)
Exploitation on the other hand is supported by incremental innovation that includes production
refinement and efficiency together with product differentiation and market penetration strategies
for existing and new emerging markets while aiming at improving the company’s competences
that would generate short term oriented profits
Tensions between Exploration and Exploitation
Both exploration and exploitation are required for successful performance of an organization.
Tension arises when scarce resources have to be shared between the two. Most organizations
concentrate on the status quo and exploration suffers as supported by Levinthal and March
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(1993) and the need for change may be realized late hence failure would set in (Leonard-Barton,
1992). On the other hand when the cost of developing new products is not recovered and new
ideas fail to capture the demands of the market then the short term performance of the company
is affected and tension between the two sides of the organization increases.
Resolving the Tensions between Exploration and Exploitation
Integrating and interrelating organization exploitation and exploration can be balanced by
utilizing overarching strategies that would govern and balance both processes (O’Reilly &
Tushman, 2008).
Exact antecedent for organization ambidexterity is still far-fetched but the tensions between
exploitation and exploration can be minimized through synchronous ambidexterity as illustrated
by Raisch & Birkinshaw (2008) and Gupta et al. (2006). These processes would include
structural, inter-firm and contextual ambidexterity.
The other solution to the tensions between exploration and exploitation is through temporal
ambidexterity.
Structural Ambidexterity
This system of resolving the conflicts between exploitation and exploration involve separating
the two into different departments in the organization and also establishing appropriate reward
systems, cultures and strategic objectives that encourage harmony between the two departments.
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The two departments can also be geographically separated and operated under different
management levels while integrating the roles of senior management (Carmeli and Halevi,
2009).
Contextual Ambidexterity
According to Gibson and Birkinshaw (2004) both exploitation and exploration processes can
practically co-exist if appropriate switching and time management systems are effectively
implemented between exploitation and exploration processes. The characteristics of
multitasking, flexibility and cooperation should also be implemented. These activities may
ultimately lead to a balanced development approach that would also minimize coordination crisis
and lower management costs.
Inter-firm Ambidexterity
Inter-firm ambidexterity involves forming alliances between the ambidexterity and the
organization creates portfolio alliances that are ambidextrous by encouraging the integration of
the exploitation and exploration alliances.
Building Organizational Contextual Ambidexterity
Finally, to build an effective contextual ambidexterity in an organization, the managers need an
invisible but powerful set of stimuli together with pressure that will positively motivate the
employees to act in a particular way. The managers achieve these processes by shaping and
designing an organizational context that has controls, systems and incentives as illustrated by
Sumantra Ghoshal and Chris Bartlett (1994) argument on the four sets of principle attributes that
define a company’s context; Stretch, Discipline, Support and Trust. The combination of the first
two attributes, Stretch and Discipline result in performance for the management and its primary
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concern is to stimulate delivery of high quality results and accountability while social support is
the combination of the last two attributes, support and trust and they are concerned with the
provision of staff security and motivation to perform. Performance management is supplemented
with social support for a company to achieve effective organizational ambidexterity. To achieve
high performance the presence of each attribute must be felt in an organization.
Reflection
To create an optimal organization context then all the four attributes that make up the needs for
performance and social support have to be considered and balanced between the operations of
the organization. For example, low or lack of social support would eventually create a burnout
context where high performance of employees would be registered for a limited period of time
and depersonalized and individualistic nature of unmotivated employees would take over
resulting in low production, absenteeism and high staff turnover. Performance suffers because
employees become exhausted, disenchanted and depressed. Alternatively, social support only
without performance measures and feedback control systems results in an organization context
known as the country-club context where a strong sense of trust and support exist but employees
don’t work as hard as they are supported. Their production levels and motivational support
systems don’t measure. The management allows mediocre performance which results in
substandard results. Most government institutions and public enterprises provide good examples
of this kind of system.
For a company to improve its performance the organization’s ambidexterity should be balanced
and all the problems diagnosed, defined and corrected in time. An organization can only achieve
high performance and maintain its success for a long period if it has a clear and a balanced
system of organizations ambidexterity.
