Abstract
The adaptability of organizations to their environment has always been a key concern in both organizational theory and management practice. Different from the single perspective of previous studies, this research adopts an integrated, outside-in perspective. Employing an agent-based simulation model (ASM) and a multiple regression model (MRM), we examine the impact of the intensity of exploitative and exploratory practice on organizational adaptability, as well as the moderating effect of environmental dynamism and organizational absorptive capacity. The results of the research show that (1) the stable environment prefers organizations with a practice strategy of high exploitation and low exploration; (2) environmental dynamism inhibits the impact of both exploitative and exploratory practices on organizational adaptability; and (3) organizational absorptive capacity significantly reinforces the link between the intensity of exploitative practice, as well as exploratory practice, and organizational adaptability. The study investigates the external alignment of organizational exploratory and exploitative practices with environmental dynamism and internal fit with absorptive capacity. The findings provide new insight into the question of how organizations can resist the erosion of environmental dynamism through strategic alignment and capacity development.
Highlights
Organizational adaptability to the environment has long been the theme of extensive attention by researchers in organizational theory and strategic management, as well as business managers [1]
Managers can adjudge that organizational adaptability has gained strength according to the improvement in company performance at a certain stage, but they do not have the means to identify the maximum value of organizational adaptability, due to the bounded rationality [40]. erefore, here, we use an approach similar to Chanda and Ray’s [38], which regards the value within a 1% range of the largest one as optimum. e optimal value of organizational adaptability reflects the level of managers’ expectations and satisfaction with organizational performance
5.1. eoretical Implications. is paper emphasizes the negative impact of environmental dynamism on organizational adaptability but does not suggest that organizations are powerless against changes in reality, as the population ecology theory [7] would have us believe
Summary
Organizational adaptability to the environment has long been the theme of extensive attention by researchers in organizational theory and strategic management, as well as business managers [1]. E exploration of the complex relationship among environment, strategy, and organizational adaptability had its roots in the internal organization Whether it is the design school [4], the planning school [5], or the positioning school [6], their focus is all on the relationship between organizational strategy and structure. Ey have conducted in-depth researches on the question of whether strategy determines structure or structure determines strategy based on population ecology theory [7], contingency theory [8], institutional theory [9], etc. Another school of research focuses on the relationship between the environment in which an organization operates and its strategy. Relevant studies have acknowledged the role of organizational resources and capabilities in determining organizational strategy. e concept of dynamic capabilities [13] developed on Complexity this basis provides the theoretical support for companies to gain through-cycle, sustainable competitive advantage
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