Standardized individuality versus individualized standardization: the role of the context in structurally ambidextrous organizations

Sustaining success requires the integration of the contradicting aims of short-term efficiency and long-term innovation. Coupling exploitation and exploration is therefore a major challenge for organizations. Small and medium-sized enterprises (SME) suffer particularly from resource constraints for nurturing both learning modes concurrently. In this paper, we draw on empirical case-study evidence of a globally operating SME to show how managing the interplay of organizational structure and context enables firms to combine exploration and exploitation for achieving ambidexterity. Our findings show that creating ambidexterity requires firms to manage different tensions on multiple levels. In particular, we distinguish between the learning dimension and the flexibility dimension of ambidexterity. The learning dimension refers to balancing incremental and radical innovations, while the flexibility dimension refers to balancing alignment and adaptability in terms of a firm’s organizational design. Both dimensions have to be balanced simultaneously to create organizational ambidexterity. We show how the creation of a common frame of reference enables the behavioral integration of exploration and exploitation and the formation of knowledge bridges at multiple levels of the organization in a structurally ambidextrous firm. Further, our findings suggest that dealing with tensions between incremental/radical innovation and adaptability/alignment refers to managing a “second-order”-balance between exploration and exploitation.