Abstract
Drawing on relevant literature, this study investigates the process of realizing innovation ambidexterity (IA) by proposing a theoretical model and adopting a specifically integrated mechanism with the aim to resolve strategic dilemmas in ambidextrous organizations (AOs). We analyzed a sample of 136 cross-sectional surveys collected from business managers of 132 medium- and high-tech firms in China by employing a structural equation model combined with moderation analysis to test our hypotheses. Our findings indicate that the second-order theoretical model fits the data well and AO, represented by a higher-order construct, positively affects IA. Instead of structural ambidexterity, balanced contextual ambidexterity and radical performance management can be effectively applied as the factors of the second-order construct; the design comprising balanced contextual ambidexterity and performance management is thus helpful in resolving strategic dilemmas. Our findings demonstrate that Chinese firms, as technology latecomers, are more inclined to conduct near-radical innovation. The risk of exploration crowding out exploitation efforts exists in Chinese high-tech firms. Furthermore, we provides greater insights into the moderating impact of intra-organizational practice on IA based on the fact that performance measurement balance (PMB) did not directly influence the achievement of IA and clarifies the positive role that PMB plays in improving IA.
Highlights
This study pertains to ambidexterity in organizational innovation
Discriminant validities related to Model 2 to Model 5 could not be supported based on the criteria of Fornell and Larcker (1981) because there is no evidence of discriminant validity for every comparison when the squared correlation between any two constructs are compared against their individual average variance extracted (AVE)
Focusing on innovation management and performance improvement of ambidextrous organizations (AOs), the aim of this study is to investigate whether an AO could be conceptualized in a unique, integrated way as a second-order construct encompassing balanced contextual and performance management (PM) approaches in order to manage the
Summary
As for the notion of ambidexterity, it refers to the integration and reconciliation of both exploitative and exploratory activities, which can produce incremental and radical innovations, respectively (Smith and Tushman, 2005; Jansen et al, 2012). Organizational ambidexterity refers to an organization’s capacity to address contradictory objectives (Gibson and Birkinshaw, 2004; Kauppila, 2010; Birkinshaw and Gupta, 2013). According to Bedford et al (2016), innovation ambidexterity is achieved incremental and radical innovation outcomes. The achievement of IA may Performance Management in Ambidextrous Organizations involve multiple objectives, including contradictory ones. March (1991) insists that firms face the strategic dilemma of binary decision-making because exploitative and exploratory activities compete for scarce resources. Prior dilemmas research indicates that conflict associated with ambidextrous innovation activity is higher in organizations that engage in simultaneous exploration and exploitation (Smith, 2014; Bedford et al, 2016). Recent studies point out that ambidextrous innovative practices are challenging for small and medium-sized enterprises due to their serious financial constraints and information asymmetries (Barbaroux, 2014)
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