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81
Organizational ambidexterity: Balancing exploitation and exploration for sustained performance
- Organization Science
, 2009
"... doi 10.1287/orsc.1090.0428 ..."
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Speed and Search: Designing Organizations for Turbulence and Complexity
, 2005
"... We use an innovative technique to examine an enduring but recently neglected question: How do environmental turbu-lence and complexity affect the appropriate formal design of organizations? We construct an agent-based simulation in which multidepartment firms with different designs face environments ..."
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Cited by 57 (6 self)
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We use an innovative technique to examine an enduring but recently neglected question: How do environmental turbu-lence and complexity affect the appropriate formal design of organizations? We construct an agent-based simulation in which multidepartment firms with different designs face environments whose turbulence and complexity we control. The model’s results produce two sets of testable hypotheses. One set pinpoints formal designs that cope well with three different environments: turbulent settings, in which firms must improve their performance speedily; complex environments, in which firms must search broadly; and settings with both turbulence and complexity, in which firms must balance speed and search. The results shed new light on longstanding notions such as equifinality. The other set of hypotheses argues that the impact of individual design elements on speed and search often depends delicately on specific powers granted to department heads, creating effects that run contrary to conventional wisdom and intuition. Ample processing power at the bottom of a firm, for instance, can slow down the improvement and narrow the search of the firm as a whole. Differences arise between our results and conventional wisdom when conventional thinking fails to account for the powers of department heads—powers to withhold information about departmental options, to control decision-making agendas, to veto firmwide alternatives, and to take unilateral action. Our results suggest how future empirical studies of organizational design might be fruitfully coupled with rigorous agent-based modeling efforts.
The fit between product market strategy and business model: Implications for firm performance
- Strategic Management Journal
, 2008
"... We examine the fit between a firm’s product market strategy and its business model. We develop a formal model in order to analyze the contingent effects of product market strategy and business model choices on firm performance. We investigate a unique, manually collected dataset, and find that novel ..."
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Cited by 51 (4 self)
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We examine the fit between a firm’s product market strategy and its business model. We develop a formal model in order to analyze the contingent effects of product market strategy and business model choices on firm performance. We investigate a unique, manually collected dataset, and find that novelty-centered business models—coupled with product market strategies that emphasize differentiation, cost leadership, or early market entry—can enhance firm performance. Our data suggest that business model and product market strategy are complements, not substitutes. Copyright 2007 John Wiley & Sons, Ltd.
Organizing for innovation: Managing the coordination-autonomy dilemma in technology acquisitions
- Academy of Management Journal
, 2006
"... Large, established firms acquiring small, technology-based firms must manage them so as to both exploit their capabilities and technologies in a coordinated way and foster their exploration capacity by preserving their autonomy. We suggest that acquirers can resolve this coordination-autonomy dilemm ..."
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Cited by 39 (5 self)
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Large, established firms acquiring small, technology-based firms must manage them so as to both exploit their capabilities and technologies in a coordinated way and foster their exploration capacity by preserving their autonomy. We suggest that acquirers can resolve this coordination-autonomy dilemma by recognizing that the effect of struc-tural form on innovation outcomes depends on the developmental stage of acquired firms ’ innovation trajectories. Structural integration decreases the likelihood of intro-ducing new products for firms that have not launched products before being acquired and for all firms immediately after acquisition, but these effects disappear as innova-tion trajectories evolve. The ability to produce multiple product innova-tions in quick succession is critical in high-velocity environments (Brown & Eisenhardt, 1997). Many companies adopt external development strategies in order to avoid the time-consuming, path-depen-dent, and uncertain processes of internally accu-mulating capabilities for producing streams of in-
The Effects of Slack Resources and Environmental Threat on Product Exploration and Exploitation
- Academy of Management Journal
, 2008
"... In a U.S. sample of nonprofit professional theaters, we examine how slack resources interact with environmental threat appraisal to influence product exploration and exploitation. We find systematic variation depending on the extent to which a resource is rare and absorbed in operations, and the ext ..."
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Cited by 36 (0 self)
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In a U.S. sample of nonprofit professional theaters, we examine how slack resources interact with environmental threat appraisal to influence product exploration and exploitation. We find systematic variation depending on the extent to which a resource is rare and absorbed in operations, and the extent of perceived environmental threats. Absorbed, generic resources are associated with increased exploitation and decreased exploration. Unabsorbed resources, both generic and rare, result in higher exploration and lower exploitation, but only when perceived environmental threat is high. Overall, results reveal pragmatic decision making balancing the benefits of superior strategic position against the risks of jeopardizing viability. The overall strategic emphasis of an organization is reflected in investments of resources in activities and processes that promote exploration or exploitation (Siggelkow & Levinthal, 2003). Exploration creates novel competencies that enable ongoing innovation and generally results in superior longterm returns (Geroski, Machin, & Van Reenen, 1993). These benefits are balanced by the higher level of risk inherent in exploratory activities, which require significant investments with uncertain payoffs (Gupta, Smith, & Shalley, 2006). Exploitation creates value through existing or minimally modified competencies that sustain longterm viability following successful exploration. Successful exploitation provides a buffer from the shocks of exploration and entails less risk than
Internationalising in small, incremental or larger steps? Harry G Barkema and Rian Drogendijk
- Journal of International Business Studies
, 2002
"... We argue that companies may enter foreign environments either incremen-tally, as suggested by long-established theory, or by taking larger steps that may result in lower initial performance but, through learning and experience, lead to increased performance in future expansions. This idea is corrobo ..."
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Cited by 21 (0 self)
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We argue that companies may enter foreign environments either incremen-tally, as suggested by long-established theory, or by taking larger steps that may result in lower initial performance but, through learning and experience, lead to increased performance in future expansions. This idea is corroborated by the experience of Dutch companies entering into Central and Eastern Europe. We also find that expansion steps may be too large, thereby limiting the exploration of foreign environments. Our study suggests that sequential internationalisation strategies do still matter, and that companies have to balance exploitation and exploration in internationalisation. Journal of International Business Studies (2007), doi:10.1057/palgrave.jibs.8400315
Patterned Interactions in Complex Systems: Implications for Exploration
, 2006
"... Scholars who view organizational, social, and technological systems as sets of interdependent decisions have increasingly used simulation models from the biological and physical sciences to examine system behavior. These models shed light on an enduring managerial question: how much exploration is ..."
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Cited by 19 (2 self)
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Scholars who view organizational, social, and technological systems as sets of interdependent decisions have increasingly used simulation models from the biological and physical sciences to examine system behavior. These models shed light on an enduring managerial question: how much exploration is necessary to discover a good configuration of decisions? The models suggest that, as interactions across decisions intensify and local optima proliferate, broader exploration is required. The models typically assume, however, that the interactions among decisions are distributed randomly. Contrary to this assumption, recent empirical studies of real organizational, social, and technological systems show that interactions among decisions are highly patterned. Patterns such as centralization, small-world connections, power-law distributions, hierarchy, and preferential attachment are common. We embed such patterns into an NK simulation model and obtain dramatic results: holding fixed the total number of interactions among decisions, a shift in the pattern of interaction can alter the number of local optima by more than an order of magnitude. Thus, broader exploration is far more valuable in the face of some interaction patterns than in the face of others. We develop simple, intuitive rules of thumb that allow a decision maker to examine two interaction patterns and determine which requires greater investment in broad exploration
Organizational Design and Restructuring in Response to Crises: Lessons from Computational Modeling and Real-World Cases
"... Organizations are occasionally faced with technology-based and accident-triggered crises that may cause costly disasters if not handled properly. Questions arise: How should organizations, with their complex processes and human involvement, be designed if they are to perform well in such crises? Wou ..."
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Cited by 18 (1 self)
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Organizations are occasionally faced with technology-based and accident-triggered crises that may cause costly disasters if not handled properly. Questions arise: How should organizations, with their complex processes and human involvement, be designed if they are to perform well in such crises? Would organizations benefit from structural changes during crises? From a neo-information processing perspective that views organizations as composed of cognitively restricted, socially situated, and task-oriented actors, we argue that the causes and consequences of crises may be better understood through the systematic examination of both environmental and organizational factors. We address our research questions using a rather unique approach: a matched analysis of 80 real organizational cases and 80 computer-simulated organizations. The findings show that a crisis can present critical challenges to organizational performance both externally and internally, and that there is no design guarantee that a high-performing organization will continue to perform well during a crisis situation. In addition, when organizations restructure to adapt to crisis situations, they often face the serious challenges of having to understand not only the external environment, but also organizational design traps. Key words: organizational performance; organizational design; computational modeling; real-crisis cases Whether theories of organization can be applied to nonconventional events or crisis situations has largely been assumed but certainly not fully explored (Carley
Contextuality within Activity Systems and Sustainability of Competitive Advantage
"... Pennsylvania is gratefully acknowledged. ..."
