Realizing the potential of the ambidextrous firm

Sustaining innovation in the face of pressures to be cost-competitive and make effective use of existing resources is not a new challenge, but recent acceleration of competition has pushed this issue high on the agenda for managers and researchers. Organizing and managing the “ambidextrous” company – a firm that excel in exploring new areas of productive knowledge and exploiting existing capabilities – has emerged as a major concern of strategic management. In this paper, we explore coordination problems that make it difficult for firms to realize their potential as ambidextrous competitors. Organizations may possess superior skills for both exploration and exploitation yet fail to achieve competitive capabilities. Ambidexterity often involves high levels of differentiation within organizations and creates critical challenges for coordination.