Abstract
We examine how two cognitive characteristics of a CEO—their construal level and cognitive flexibility—affect a firm’s ambidexterity, which is its ability to simultaneously pursue exploration and exploitation. Drawing on construal level theory and the paradox perspective in leadership, we argue that CEOs who think at more abstract levels are better able to flexibly adapt to the changing conditions of exploration and exploitation, and are thus more effective at achieving ambidexterity. We examined the proposed hypotheses in a sample of 344 Korean small- and medium-sized enterprises, using two-round (one-year lagged) and multi-respondent (CEOs and executives) survey data. We find that CEO construal levels lead to CEO cognitive flexibility, which in turn influences firm ambidexterity. This study provides new insights on how CEO cognitive capabilities can foster firm ambidexterity.
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