Abstract
Innovation ambidexterity is especially complex for young technology-based firms because they are resource-challenged and knowledge deficient in strategic terms; but they possess considerable scope for entrepreneurship. Strategic entrepreneurship may provide a solution. Incubators emerged as a policy solution precisely due to this dilemma. We conceptualise that strategic entrepreneurship, as a synthesis of opportunity-seeking and advantage-seeking behaviours of young technology-based firms, can affect both explorative and exploitative innovation activities in these firms and expect that subsequent innovation ambidexterity affects profitability. Our empirical analyses reveal complex and competing interrelationships that both ease and exacerbate the tensions associated with innovation ambidexterity. We contribute to theory by testing strategic entrepreneurship as it applies to innovation ambidexterity and evidence behaviours that contribute to its foundations. To entrepreneurs and managers, we offer a set of prescriptions for innovation ambidexterity in young firms that accounts for the complementarities between complex and theoretically opposing constructs.
Highlights
Young technology-based firms face two fundamental challenges connected to their liabilities of newness
Ambidexterity is necessary to increase the efficiency of processes, improve operations management and create value that may eventually help these firms to attain legitimacy, accountability, reliability and short-term sustainability; while pursuing new opportunities and building creative services and products for medium-to-long-term viability in the face of rapid technology development driven by intense competition in technology industries
We generated data from incubating, young technology-based firms. Such firms have reasons to be engaged in innovation and strategic entrepreneurship, and the context is advantageous because incubators offer immediate opportunities for young firms to start networking, offering opportunities to access relational resources and develop relational embeddedness with like firms
Summary
Young technology-based firms face two fundamental challenges connected to their liabilities of newness. Ambidexterity is necessary to increase the efficiency of processes, improve operations management and create value that may eventually help these firms to attain legitimacy, accountability, reliability and short-term sustainability (exploitation); while pursuing new opportunities and building creative services and products for medium-to-long-term viability in the face of rapid technology development driven by intense competition in technology industries (exploration). Both of these activities are at odds with each other (March, 1991). A potential solution lies in strategic entrepreneurship: the extent to which a firm marries opportunity-seeking and advantage-building behaviours (Kuratko and Audretsch, 2013; Mazzei et al, 2017; Withers et al, 2018)
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