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Chapter 19: Innovation through Ambidexterity: How to Achieve the Ambidextrous Organization
Constantinos Markides and Wenyi Chu Introduction The ability of a ﬁrm to exploit its current business while exploring new territory (in terms of new technologies, markets, products or business models) has long been recognized as a critical source of competitive success (Thompson, 1967; Quinn and Cameron, 1988; March, 1991; Tushman and O’Reilly, 1996; Eisenhardt and Martin, 2000). The need to achieve a ‘balance’ between these two distinct activities has been proposed in a wide range of management areas, including organization theory, managerial economics (for example, Ghemawat and Costa, 1993), international business (for example, Bartlett and Ghoshal, 1989) and strategic management (for example, Winter and Szulanski, 2001). However, achieving this balance is a ‘central paradox of administration’ (Thompson, 1967, p. 15). This is because the skills, mindsets, structures and processes required to achieve exploitation of the current business are fundamentally diﬀerent and often conﬂict with those required to achieve exploration. For example, in a classic study, Burns and Stalker (1961) proposed that organizations developing new products (that is, exploring) should be organic, whereas organizations engaged in exploiting their existing businesses should be mechanistic. Several other studies have shown that exploration and exploitation require substantially diﬀerent structures, processes, skills and strategies that appear contradictory and diﬃcult to combine (March, 1991; Levinthal and March, 1993; Tushman and O’Reilly, 1996; Sheremata, 2000; Benner and Tushman, 2003). Organizations that are capable of achieving the appropriate balance between exploitation and exploration have been labeled ‘ambidextrous’ organizations (for example, Duncan, 1976; Tushman and...
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