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The relationship among innovation, organisational ambidexterity and organisational performance

January 2019
International Journal of Business Innovation and Research 19(4):554

January 2019
19(4):554

DOI:10.1504/IJBIR.2019.10023208

Authors:

Bader Obeidat

University of Jordan

Esraa Amayreh

Applied Science Private University

Rateb Jalil Sweis

University of Jordan

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554 Int. J. Business Innovation and Research, Vol. 19, No. 4, 2019

The relationship among innovation, organisational

ambidexterity and organisational performance

Esra’a M. Alamayreh, Rateb J. Sweis* and

Bader Y. Obeidat

Department of Business Administration,

The University of Jordan,

Amman 11942, Jordan

Email: es_alamayreh87@yahoo.com

Email: r.sweis@ju.edu.jo

Email: b.obeidat@ju.edu.jo

*Corresponding author

Abstract: This review seeks to investigate the relationship among innovation,

organisational ambidexterity and organisational performance by reviewing the

related literature. The findings showed that the question of whether

ambidexterity leads to an improved organisational performance or not is still

barely developed and the results are still inconclusive. Although most

theoretical and empirical studies have verified the positive relationship between

organisational ambidexterity and innovation, and the positive relationship

between innovation and performance, there is a lack of empirical evidence in

the literature exists regarding these relations. As well, there is a paucity of

studies that explore the relationship among innovation, organisational

ambidexterity and organisational performance. Additionally, the findings

revealed that innovation has a mediating effect on the relationship between

organisational ambidexterity and organisational performance.

Keywords: innovation; organisational ambidexterity; organisational

performance.

Reference to this paper should be made as follows: Alamayreh, E.M.,

Sweis, R.J. and Obeidat, B.Y. (2019) ‘The relationship among innovation,

organisational ambidexterity and organisational performance’, Int. J. Business

Innovation and Research, Vol. 19, No. 4, pp.554–579.

Biographical notes: Esra’a M. Alamayareh obtained her Master’s degree from

the University of Jordan in Quality Management and Bachelor’s in Industrial

Engineering from the University of Jordan. She has experience in project

management field. She also served as a Production Engineer.

Rateb J. Sweis is a Professor of Project Management from the University of

Jordan, Department of Business Administration. He served as the Vice Dean of

the Jordan Institute of Diplomacy, an Advisor to the Minister of Finance and is

currently a faculty member in the Department of Business Management from

the University of Jordan. He has many published articles in the areas of quality

management, project management and productivity. He also has five published

books in operations management, project management and communications

management.

The relationship among innovation, organisational ambidexterity 555

Bader Y. Obeidat is a Professor in Strategic Management from the University

of Jordan, having obtained his PhD from the Durham University in the UK. He

is interested in many fields including strategic management, strategic decisions,

human resource management, and international business and management.

1 Introduction

As competition strengthens and the pace of change accelerates, organisations must renew

themselves by both exploiting (e.g., efficiency) current competencies and capabilities and

exploring (e.g., innovation) new ones (March, 1991; Tushman and O’Reilly, 1996; Renzl

et al., 2013). If an organisation focuses only on managing the short-term goals, it will

face the risk of becoming obsolete in the long-run. Inversely, over-focus on exploration is

expected to push the organisation to a cash crunch situation in the short-run (Sinha,

2016). Solving this tension forces organisation to become ambidextrous (Duncan, 1976;

Raisch and Birkinshaw, 2008; O’Reilly and Tushman, 2013; Palm and Lilja, 2017).

The dynamic nature of the business environment, and the need to deal with local and

worldwide competition challenges, encourages organisations to upgrade their flexibility,

efficiency and awareness through the innovation of products, services, processes and

behaviours (Reuvers et al., 2008). Organisations focus on innovation to permit attaining

new opportunities and better usage of its resources for converting innovative ideas into

successful outcomes (Niu et al., 2013). Innovation has been considered as one of the

significant factors that affect the organisational performance, value, competitive

advantages, and survival (Walker, 2004; Abdallah et al., 2016; Chuluuna et al., 2017;

Ghaben and Jaaron, 2017). Moreover, it includes the development of products that are

more effective and processes with the implementation of new knowledge and information

(Chuluuna et al., 2017; Ilori et al., 2017).

Organisations struggle to survive under conditions of high competition, and thus

mush achieve high levels of performance; it only though this level of performance that

they can grow and develop (Gavrea et al., 2011; Mehralian et al., 2016). In addition, the

potential success of a business depends on its performance, which means its ability to

implement strategies effectively to achieve the intended objectives (Randeree and

Al Youha, 2009; Sweis et al., 2016). Cao et al. (2009), Junni et al. (2013) and Birkinshaw

and Gupta (2013) comment that organisational ambidexterity and innovation concepts are

accepted as two factors that provide high organisational performance. Accordingly, this

review will explore the literature related to the relationship among innovation (product

and process innovation), organisational ambidexterity (exploitation and exploration), and

organisational performance.

2 Literature review

2.1 Organisational ambidexterity

Ambidexterity is used to describe organisations that are capable of exploitation-actions

and learning through a specific search, a refinement and upgrading of what already exists

and exploration: learning through totally innovative processes, planned research, or being

556 E.M. Alamayreh et al.

aligned with current activities, and being efficient enough to meet the demands while, at

the same time, adapting to and expecting future change (Moreno Luzon and Pasola, 2011;

Boumgarden et al., 2012).

In the opinion of O’Reilly and Tushman (2013), ambidexterity is defined as the

capability of an organisation to both explore and exploit; to compete in settled

technologies and marketplaces where efficiency, control, and incremental improvement

are valued and to compete in new technologies and marketplaces where flexibility,

self-sufficiency, and experimentation are required.

Organisational ambidexterity has been considered as something embedded in one’s

behaviour (Gibson and Birkinshaw, 2004), a way of modelling organisational structure

(O’Reilly and Tushman, 2004), top management team skill to engage in inconsistent

intellectual processes (Smith and Tushman, 2005), an organisational capability (O’Reilly

and Tushman, 2008), and a manager’s behavioural orientation (Mom et al., 2009).

Smith (2017) states that organisational ambidexterity involves two polar contraries:

exploitation versus exploration. On one side, exploitative methods focus on existing

customers and/or markets. On the other side, explorative methods focus on more creative

and innovative aspects, which can include new knowledge, experimentation, flexibility

and divergent rational.

Organisations that are good at reaching the appropriate balance between exploitation

and exploration have been characterised as ambidextrous organisations (e.g., Duncan,

1976). Asif and Vries (2014) assert that concentrating merely on exploitation can cause

failure to innovate and to address upcoming marketplace requirements, while

concentrating merely on exploration can lead to poor efficiencies and cause waste of

organisational resources. Thus, Levinthal and March (1993), Moreno Luzon and Pasola

(2011) and Chandrasekaran et al. (2012) note that the existence of both is needed since

the failure to manage these tensions can result in a success (competence) trap; too much

exploitation at the expense of exploration or a failure trap; too much exploration at the

expense of exploitation.

Consequently, there is no accurate ratio of exploration to exploitation that is better or

worse. Thus, organisations realise the necessity to keep a balance between modifying the

existing processes and exploring new opportunities by altering to new products, markets

and technology in order to define their present and future by choosing between the two

(Brown and Eisenhardt, 1998).

The truth is that organisations typically encounter a variety of competitive

marketplaces and that these will vary in the rates of exploration and exploitation required

(Ramachandran and Lengnick-Hall, 2010). Therefore, in order to achieve ambidexterity,

organisations need to handle the resulting tension between exploitation and exploration

by applying the most appropriate forms of ambidexterity. These forms are discussed in

the following section.

2.1.1 Forms of organisational ambidexterity

1 Contextual ambidexterity: This form is suggested by Gibson and Birkinshaw (2004).

It might be used to pursue exploration and exploitation by generating an

organisational context within which personnel can freely choose to explore or exploit

(Turner et al., 2013). However, it has its limitations. Chen (2017) assumes that a

single organisational context can enable both exploration and exploitation to flourish,

while exploration and exploitation may flourish in different organisational contexts.

The relationship among innovation, organisational ambidexterity 557

When new initiatives are not completely diverse from an organisation’s core

businesses, contextual ambidexterity can permit exploratory initiatives to arise in the

existing organisational context. When new initiatives are completely diverse from

the core business, contextual ambidexterity may not work. Hence, it is not practical

to assume a single organisational context to support both exploration and

exploitation. Liu et al. (2012) manifest that the integration within this form depends

on social and behavioural means, such as socialisation, culture, personal relations,

and behavioural norms.

2 Sequential ambidexterity: This form, proposed by Duncan (1976), enables

exploration and exploitation through sequential separation (Boumgarden et al., 2012;

Turner et al., 2013). Sequential ambidexterity is based on the idea that organisations

can emphasis their attention on exploitation during some periods and on exploration

during other periods. Sequential ambidexterity permits organisations to use different

managerial practices to manage projects at different phases. Although it is

challenging at the organisational level in the face of fast change (Tushman and

O’Reilly, 1996; Christensen and Overdorf, 2000), it is effective at the project level

(Blank, 2013). In order to achieve sequential ambidexterity at the organisational

level, Christensen and Overdorf (2000) state that organisations need to switch back

and forth between the dual polar contraries, exploration and exploitation, to

restructure strategies, and to processes accordingly. Such switches can cause

disturbance in organisations and may even demolish core organisational

competencies.

3 Structural ambidexterity: This form offered by Tushman and O’Reilly (1996), which

puts exploration and exploitation into structurally split business units – as it limits

exploitation to some units, and exploration to other – that are then coordinated by top

managers (Turner et al., 2013; Dutta and Guha, 2015; O’Reilly and Tushman, 2016).

It also allows different business units to use diverse strategies, structures, and

processes. Even though it is the most favourable and practical solution to chase the

organisational ambidexterity, it places vast job demands on top managers as different

units with different structures are required to be managed and new units should be

created when needed, and they should selectively intervene in these units (Chen,

2017; Heracleous et al., 2017).

4 Dynamic ambidexterity: This form is proposed by Chen (2017). It exploits all three

forms of ambidexterity at different organisational levels. First, it utilises structural

ambidexterity at the corporate level. Second, it recognises the value of contextual

ambidexterity at the business unit level. Third, it utilises sequential ambidexterity at

the project level. Furthermore, it enables organisations to recognise the benefits of

different forms of ambidexterity and mitigate their limitations. It also allows

organisations to accommodate the contrasting logics of exploration and exploitation

and to excel at both.

Previous studies (e.g., He and Wong, 2004; Andriopoulos and Lewis, 2009) refer to the

organisational ambidexterity in terms of exploitative and explorative innovation, while

other studies describe it in terms of exploitative and explorative learning (e.g., March,

1991; Cao et al., 2009).

558 E.M. Alamayreh et al.

2.1.2 Exploitation and exploration

Exploration and exploitation characterise two different concepts. According to March

(1991), things which are familiar to organisations and which are considered to be stable

can be exploited through selection, execution, and efficiency (exploitation). While

familiar things include activities such as mapping, monitoring, improving processes, and

ensuring conformance with accepted standards, unfamiliar things must be discovered

through exploration activities comprising of search and investigation (exploration).

Andriopoulos and Lewis (2009) state that exploitation focuses on refining current

processes, products/services with the aim of gradually improving efficiency with a

limited risk of innovation to permit incremental innovation. On the other hand, Chen

(2017) reveals that in exploitation, the organisational attention is focused on existing

businesses or existing ways of doing businesses and on employing available information

and capabilities to achieve short-term organisational aims and market positions. Thus,

exploitation involves low levels of uncertainty and has high rates of success.

Furthermore, exploitation is about meeting the challenges of nowadays (Maijanen and

Virta, 2017). Shirokova et al. (2013) believe that exploitation should include factors such

as investment in internal resources, valuing knowledge-related resources, organisational

learning, and developmental and transitional organisational change. On the other hand,

March (1991) defines exploration as an examination based on variation, risk assumption,

investigation, flexibility and innovation in developing new products, processes,

assessment criteria and technologies. His definition emphasises the belief that

organisations may have not yet achieved their maximum capabilities, and so they need to

stretch their existing capabilities (Wang and Chen, 2015), transform existing capabilities

(Teece, 2007), or develop new capabilities (Capron and Mitchell, 2009). Furthermore,

exploration focuses on discovering new potentials, maximising variance, essential

changes, and trial and error (O’Reilly and Tushman, 2008).

Chen and Katila (2008) observe that exploration and exploitation need not always be

competing activities, but can and should be complementary. Scholars identify different

ways of pursuing exploitation and exploration. One group has highlighted the structural

separation in organisations, where the organisational units involved in exploration are

physically separated from those pursuing exploitation (Tushman and O’Reilly, 1996).

However, more recently, another group highlights that organisations and their managers

should have a behavioural orientation toward dual capacities (Cao et al., 2009; Lee et al.,

2017).

With regard to evaluation, exploitation can be evaluated using traditional financial

metrics (Christensen et al., 2008; Christensen and Bever, 2014) because organisations

may be able to calculate the returns on investment for exploitative projects. However,

exploration cannot be evaluated by traditional financial metrics because such metrics may

underrate the value of exploration (Christensen and Bever, 2014). The progress of

exploration needs to be evaluated by internal learning and validation and by external user

interest and engagement (Croll and Yoskovitz, 2013).

2.2 Innovation

Organisations seek to upgrade their flexibility, efficiency and awareness because of the

dynamic nature of business environment and the need to deal with local and worldwide

competition challenges. This is translated to a greater need for continuous innovation of

The relationship among innovation, organisational ambidexterity 559

products, services, processes and behaviours (Reuvers et al., 2008). Organisations focus

on innovation to help them attain new opportunities and to better use its resources (Niu

et al., 2013).

Innovation is defined as new knowledge combined and implemented in new products,

processes and services (Afuah, 1998; Ilori et al., 2017). It is also defined as the creation

of new knowledge and ideas to facilitate new business outcomes (Plessis, 2007). While

Sawhney et al., (2006) argue that, it not only implies the generation of new products but

also the generation of a new method, brand, or business model. Furthermore, innovation

is not only a process, but also a mix of innovative components that includes the

unpredictable requirements from the environment, requirements of production procedure,

variation of industries and markets, as well as the composition of demographics

(Drucker, 1993).

Walkera et al. (2015) reveal that organisations can both generate and adopt

innovation. Generation is a process that results in an outcome – a new product, service,

technology, or practice for its own use or for delivery to the market. While adoption is a

process that explains, how an organisation acquires and uses a technology, product, or

practice for the first time.

Baregheh et al. (2009) and Tidd and Bessant (2011) affirm that the concept

of innovation is certainly not a one-time phenomenon, but a long and snowballing

process of a large number of organisational decision-making practices. These practices

range from the creation stage of a new idea, which consists of three sub-stages:

knowledge awareness, creation of attitudes toward innovation, and decision, to the

implementation stage, which consists of two sub-stages: initial and continued

implementation.

The aim of innovation is not to find a gap in the marketplace, but to find a future

gap in it. Thus, this indicates that an idea for an innovation needs to carry future-

evidence (Duin and Graaf, 2010). Many studies have recognised the benefits

of innovation as its contribution to industrial growth (Nagji and Tuff, 2012;

Benaim, 2015). Furthermore, these benefits lead to the dynamic growth of the

organisation’s economic value. It results in an increase in the employment as well as in

its profit. In addition, it enhances the organisation’s performance and help organisations

maintain their position in the marketplace (Ilori et al., 2017). Likewise, Plessis (2007)

reveals that innovation aims at improving internal business processes and structures

and creating market-driven products and services. Furthermore, Webste (2004) states

that innovations can decrease the production cost, enhance the quality of

products, capture or generate new product markets and diminish the organisation’s

dependence upon unreliable factors of production. Additionally, other scholars such as

Roger and Martha (2010) and Kaivi-Oja (2011) stress the benefits of innovation by

clarifying that it is a priority and a crucial factor in achieving customer value. Therefore,

the creation of something new is no longer an elective choice but a requisite facing all

organisations.

Hafkesbrink and Evers (2010), Hafkesbrink and Schroll (2011) and Zhang and Yao

(2016), discuss three models of innovation. The first model is the closed one. It involves

carrying out innovation activities as an enterprise can rely merely on its own strength.

The second model is the open one, where the valuable ideas can come from inside

and outside the organisation and can go to market from inside and outside it. The third

model is the embedded innovation. It means the crucial capacity of an organisation to

560 E.M. Alamayreh et al.

coordinate organisational structures, cultures, and processes with open collaborative

learning procedures in nearby communities. Nevertheless, Leitner et al. (2016) cite

different innovation models such as open, user, crowdsourcing, and community

innovation.

In order for innovation to be successful within an organisation, Alves et al. (2007)

and Freeman et al. (2015) stress that a number of key components should be available.

These components consist of the input resources, which are knowledge, talent and

capital. Additionally, enabling resources such as infrastructure, connections and networks

plays a big role in strengthening the organisation’s knowledge resources, talent and

capital through the engagement with other factors. Moreover, innovation flourishes in

organisations with a culture that is exposed, trusting, supportive, encouraging to

risk-taking, and learning from failure. In addition, the structure is closely linked to culture

as it includes organisational, management and bureaucratic structures. On the other hand,

Ghaben and Jaaron (2017) states that the fundamental limitation to innovation is the

absence of powerful management.

Doran and Jordan (2016) identify four types of innovation. The first type is, new to

market (NtM) product innovation – where innovation is defined as the generation of a

new good/service to marketplace that is not already provided by its competitors. The

second is new to the firm (NtF) product innovation, where innovation is defined as the

generation of a new or a crucially improved good/service to the organisation’s market

which is already made available by the competitors. The third is process innovation, and

the fourth is organisational innovation, where innovation is defined as new methods for

organising procedures, work responsibilities and decision-making or relations with other

organisations.

In his extensive literature about innovation, Buenechea-Elberdin (2017) states that

the concept has been measured according to the results of innovation in terms of

the outcome of the innovation process, such as new products, services, processes

or managerial practices (e.g., Wu et al., 2007; Hsu and Fang, 2009). Also based on

the process of innovation; which focuses on the methods of innovation (e.g., Aramburu

and Sáenz, 2011; Aramburu et al., 2015). The degree of radicalism, which is related

to the degree of modification of the developed innovation (e.g., Ramezan, 2012;

Wang and Chen, 2013; Aas et al., 2016). Further, the innovative character

or innovativeness focuses on an organisation’s desire and purpose to innovate

(e.g., Kipkirong and Kiptanui, 2015).

The various types of innovation identified in the literature include product,

process, organisational and marketing innovations. Mothe et al. (2010) divide innovation

into two categories: technological (e.g., product and process) and non-technological

(e.g., organisational and marketing) innovation. According to Pantano (2016) and

Hua et al. (2017), innovation is divided into two different forms, process innovation

and product innovation. Forés and Camisón, (2016) merely focus on product innovations,

whereas Ilori et al. (2017) evaluate innovation in terms of technological, market

and organisational/administrative characteristics. While Roy et al. (2015) and

Abdallah et al. (2016) emphasis on two types of innovation that are, technical (product

and process) and management innovation. Whereas, Habidin et al. (2015), stress only

process innovation.

Additionally, product and process innovation is considered one of the significant

measures for assessing sustainable development and competitiveness of organisations (Li

and Ni, 2016).

The relationship among innovation, organisational ambidexterity 561

2.2.1 Product innovation

Incremental and radical innovation in products/services is critical for organisation’s

sustained competitive advantage and survival (Sumo et al., 2016). Product innovation

refers to the delivery of differentiated, improved or new products/services in the

marketplace (Palacios et al., 2008). According to the Organization for Economic

Cooperation and Development (OECD, 2005) it is referred to as the introduction of

products/services that are new or significantly upgraded with respect to their

specifications or planned uses. As a result, this comprises significant improvements in

technical specifications, components and materials, combined software, consumer

friendliness or other functional features.

Therefore, purposes of product innovation may be to develop new products, improve

product characteristics, or improve product quality to support delivering a better value to

the customer (Lager, 2002; Sorescu et al., 2003; Chenavaz, 2012; Chang et al., 2012;

Visnjic et al., 2016; Anning-Dorson’s, 2017). New products frequently require the

improvement of new equipment (Hullova et al., 2016). This includes activities such as the

technical design, R&D, and commercial activities involved in the marketing of a new or

an upgraded product (Alegre et al., 2006).

Gunday et al., (2011) and Slater et al. (2014) highlight that product innovation is

generally realised as a vital element of competitiveness, rooted in the organisational

products, service, structure, operations and processes. They also state that this type of

innovation is significant as main tools of growth strategies, which are required to enter

new marketplaces and increase the existing marketplace share.

As noted by Spanjol et al. (2012), product innovation outcomes are determined by the

type of market motivations that organisations choose, besides the explanation frame of

the organisation, which determines how the motivations are managed. The product

innovation work is mainly driven by the market needs and ultimately by external

customers. Thus, the product innovation work is mainly effectiveness-driven (Bergfors

and Larsson, 2009).

In their study, Nørskov et al., (2015) identify five product characteristics that

influence implementation decisions, which are complexity, trial-ability, compatibility,

observability and relative benefit. On the other hand, Engelman et al. (2017) measure

product innovation using influence indicators – which measure the influence of the

product innovation based on the business performance. In addition, they use the output

indicators – which measure the degree of the implementation of the product innovation

within the organisation.

2.2.2 Process innovation

Process innovation is concerned with the introduction of new mechanisms into an

organisation’s operations such as input resources and task specifications (Afuah, 1998).

Moreover, Troilo (2014) illustrates that process innovations are a recombination that lead

to new ways of delivering current products to the marketplace. Additionally, Onodera

et al. (2016) refer to process innovation as the improvement in the production process and

technologies of current products and through new processes of production in order to

reduce product cost, or to upgrade the product’s quality and performance through

technological innovation. Therefore, process innovations require organisations to apply

technology in order to increase the efficiency of product development and marketing. An

562 E.M. Alamayreh et al.

organisation’s concentration in quality control and reengineering may stimulate the

organisation to improve efficiencies and therefore emphasise the implementation of

process innovations (Bergfors and Larsson, 2009).

Per Doran and Jordan (2016), process innovation comprises of three elements: first,

new or significantly-upgraded techniques of manufacturing or producing goods/services,

second, new or significantly-upgraded logistics, delivery or distribution techniques for

inputs or goods/services, third, new or significantly upgraded supporting activities for

processes.

2.3 Organisational performance

Organisational performance is considered a key aspect in many research in management

literature since it plays a crucial role in developing, implementing, and monitoring a

strategic plan as well as in setting the future direction of the organisation

(Teeratansirikool et al., 2013). Thus, the possible success of a business depends on its

organisational performance, which is referred to as its ability to effectively and efficiently

implement strategies to accomplish the desired goals (Randeree and Al Youha, 2009). In

other words, organisational performance includes the measurement of the actual

outcomes or outputs of an organisation compared to the envisioned outputs (Richard et

al., 2009). Besides, Wheelen and Hunger (2010) define it as a reflection of the means

through which an organisation exploits tangible and intangible resources to accomplish

its goals. Moreover, Ho (2008) and Koohang et al. (2017) define it as an indicator that

measures how well an organisation achieves its aims.

As identified by Lebans and Euske (2006), organisational performance is the measure

of an organisation’s progress and development. Accordingly, continuous performance is

the aim of any organisation because only by performance, organisations are able to

develop and progress. Thus, for Hamon (2003) organisational performance involves

strategic planners, operations, finance, and legal and organisational development. Also

Semuel et al. (2017) refer to organisational performance as the ability of an organisation

to attain high profits, product quality, a large market share, and good financial results.

The organisational performance needs to be measured along both the work unit and

the organisational levels, necessitating information and compatible dimensions for

planning, tracing, analysis and improvement. As a result, the performance measures

chosen in Antony and Bhattacharyya (2010) and Koohang et al. (2017) studies are

competitiveness, innovativeness, productiveness, creativeness, effectiveness, efficiency

and profitability. Measures for organisational performance can be divided into financial

and non-financial measures as their base (Nzuve and Omolo, 2012; Abdalkrim, 2013).

However, Wang et al. (2015) use five key measures, specifically: finance and customer,

internal business, work satisfaction, pay and benefits, and innovation and technology.

Moreover, Chen and Ling (2010) use five items to assess the organisational performance,

which are profit growth, returns of sales, returns of asset, returns of earning, and

organisation’s reputation.

In today’s competitive marketplace, organisations must be able to assess their goals

through performance measurement approaches, such as unit cost, profit, and quality

performances. They should also make sure to setup appropriate strategies to achieve their

goals. As a result, Mehralian et al., (2017) categorises performance measures into four

major groups, which are financial, customer, internal business processes, and learning

and growth. While Ho (2011) and Jeong et al. (2014) examine organisational

The relationship among innovation, organisational ambidexterity 563

performance on two aspects: financial performance and market performance – where

organisational performance refers to the extent to which the organisation executes in the

market share, profit ratio, and customer satisfaction. On the other hand, Minna (2014)

and Wang et al. (2016) conceptualise organisational performance as financial and

operational performance due to the inferences they hold for competitiveness and survival.

Saleh and Sweis (2017) and Abdallah et al. (2016) focus only on the operational

performance of the organisations.

Camison and Villar-Lopez (2012) argue that traditional financial performance is the

index that is most frequently used to measure the performance of the organisation by

researchers. Nevertheless, Ramezan et al. (2013) state that traditional performance

measures, which are mostly financial, are considered insufficient as they focus only on

short-term accomplishments, reward or inadequate behaviour, and lead to management

frustration and conflict, which in turn affect the organisation’s ability to create a

competitive advantage.

2.3.1 Financial performance

Financial or objective measures are generally based on data in financial statements and

accompanied notes (Hamdam et al., 2012). These measures are more tangible, and they

include profit, profit growth rate, return on equity (ROE), return on sales and return on

assets (ROAs), etc. It is also referred to as the extent to which the organisation executes

in relative profitability, return on investment, and total sales growth (Bhatt and

Bhattacharya, 2015).

Bani-Hani et al. (2009) state that organisations adopt financial measures because they

generate accountability and provide feedback on organisational operations, which allows

evaluating whether organisations have met the target profitability and made practical

financial decisions for the business. This information helps organisations become more

effective and efficient in planning, budgeting and evaluating. Wang et al. (2016) call for

satisfying the stakeholders, especially in the short-term. According to them, an

organisation should attain the desired financial performance, which is mainly focussed on

the ROAs, the return on investment, the growth of sales, and so on.

Bakotić (2016) selects several financial indicators that are: the total asset turnover,

the current asset turnover, revenues over expenses ratio, the ROA, the ROE, the return on

capital employed (ROCE), revenue per employee, earnings before taxes per employee,

and labour costs per employee. On the other hand, Qu et al., (2017) and Borlea et al.

(2017) measure organisational financial performance merely as the ROAs (i.e., the ratio

of total profits to total assets). Chi and Lin (2011) use three financial indicators, namely:

ratio of ROE, ratio of ROA, and net profit margin (net income after taxes/revenue). They

consider that both ROE and ROA have been widely used in research since they are good

indicators of profitability in terms of determining how effectively organisations use their

funds and asset to develop the size of the business. In addition, the net profit margin is an

indicator of profitability that reflects how effectively organisations transform the revenue

profit into an actual one. Moreover, as a high profit margin indicates a high margin of

safety (Hua et al., 2017). An organisation’s performance is measured by the added value

(AV), which is a financial performance measure calculated as the difference between

output (total sales) and input (the cost of materials, components and services)

(Díaz-Fernández et al., 2015).

564 E.M. Alamayreh et al.

2.3.2 Operational performance

The operational performance reflects the success factors of an organisation from

executing adaptations such as quality control and cost management. It can lead to a

competitive advantage on the long-term (Wang et al., 2016). It also refers to the ability of

an organisation to reduce its management costs, order-time, and lead-time through

improving the effectiveness of using raw material and distribution capacity (Heizer et al.,

2008). The term also has a significant meaning for organisations as it helps them improve

the effectiveness of production activities and create first-class products, which leads to

increased revenue and profit for organisations (Kaynak, 2003).

According to Manikas and Terry (2010), operational performance can be considered

as either internal or process performance. Nevertheless, Flynn et al. (2010) refer to it as

the improvement in the response of an organisation to a dynamic environment, which is

related to its competitors. On the other hand, others define it from marketing factors, such

as reputation and customer acceptance (Wu et al., 2008).

Yet, Luo et al. (2011) refer to it as non-financial/economic aspects, which consist of

visible outcomes, such as customer satisfaction, customer loyalty, and support for local

communities, which are related to a business organisation’s social/societal relations. In

addition, competitive success factors, such as new product introduction and innovation,

product/service quality, productivity, and marketing effectiveness, can lead to operational

efficiency. However, the most widely used measures of operational performance in the

literature are cost, quality, delivery (respond time), and flexibility (e.g., Joshi et al., 2003;

Flynn and Flynn, 2004; Phan et al., 2011).

3 The relationship between organisational ambidexterity and

organisational performance

Previous studies argue that the ambidextrous approach is correlated to organisational

performance. However, the empirical outcomes of these studies are contradictory. Some

researchers have argued that these activities do not necessarily guarantee performance

and that the relationship between ambidexterity and performance is more complex

(Simsek, 2009; Sirén et al., 2012).

Organisational scholars argue that the organisation’s ability to balance between

exploitation and exploration is crucial for long-term survival and competitive advantage

(March, 1991; Levinthal and March, 1993; Cao et al., 2009; Birkinshaw and Gupta, 2013;

Junni et al., 2013; Turner et al., 2013; O’Reilly and Tushman, 2013). Many empirical

studies have tested this argument and agreed with it (Lubatkin et al., 2006; Chen and

Ling, 2010). Similarly, He and Wong (2004), based on a sample of 206 manufacturing

organisations, find that ambidextrous organisations with a high degree of exploratory and

exploitative result in a higher sales growth. Additionally, a case study done by Gibson

and Birkinshaw (2004) suggests that the benefit of an ambidextrous organisation is much

more than cost; since it would reduce controlling and monitoring costs, the organisational

performance accordingly improves.

Ambidexterity suggests that the synergistic mixture of exploration and exploitation

can drive the overall performance (Lin et al., 2007; Cao et al., 2009; Chandrasekaran

et al., 2012; Junni et al., 2013; Mom et al., 2015) which in turn lead to an advanced and

more sustainable financial performance (Simsek et al., 2009).

The relationship among innovation, organisational ambidexterity 565

On the other hand, Venkatraman et al. (2006) did not find empirical support for the

ambidexterity-performance relationship. Alike, Bierly and Daly (2007) find that

ambidextrous organisations do not lead to enhanced performance. Whereas some studies

discover that, the interface of exploration and exploitation is negatively related to the

organisational performance (e.g., Atuahene-Gima, 2005; Lavie et al., 2011). Some other

studies have shown an inverted U-shaped relationship between ambidexterity and

performance (e.g., Uotila et al., 2009; Caspin-Wagner et al., 2012; Wei et al., 2014).

4 The relationship between organisational ambidexterity and innovation

Researchers have used the concept of ambidexterity to refer to an organisation’s ability to

excel at contradictory types of innovation: at exploiting current products to permit

incremental innovation and at exploring new probabilities to support additional radical

innovation (Smith and Tushman, 2005; Lubatkin et al., 2006; Andriopoulos and Lewis,

2009; Enkel et al., 2016). Additionally, innovation can be directed towards the

exploitation of existing knowledge and skills or the exploration of new knowledge and

skills (March, 1991). Therefore, the two concepts are generally related and connected.

According to Danneels (2002), O’Reilly and Tushman (2004) and Jansen et al.

(2006), organisations that aim to sustain innovation need to operate in two ways

concurrently. They first need to provide stability to their present products and processes

by building in efficiency, reliability and consistency in their procedures

(incremental/exploitative innovations). Then they need to investigate, explore and create,

to shape the bases for the creation of new products/services and processes

(radical/exploratory innovations).

O’Reilly and Tushman (2013), conclude that in dynamic environments,

organisational ambidexterity seems to be positively associated with increased

organisation’s innovation. Moreover, He and Wong (2004) provide empirical evidence on

the positive influence of ambidexterity in the framework of technological innovation

(product and process). Outcomes from the case study conducted by Michl et al. (2013)

disclose that there is a relationship between realising organisational ambidexterity and a

higher overall innovative performance.

Likewise, Zhou et al. (2016) realise that the exploitation of the current properties,

assets and resources in innovation methods and the exploration of new technologies and

markets to capture current, as well as new opportunities, are important for organisations

operating in a changing environment to achieve ambidexterity, and to be successful. In

addition, the significance of exploration and exploitation lies in their potential for

sustaining a competitive advantage by enabling incremental and radical innovation

(Gibson and Birkinshaw, 2004).

Indeed, previous research proposes that exploration and exploitation activities have

different roles in the innovation process and affect different innovation outcomes.

Exploration seems to be more vital for accomplishing differentiated and innovative

outcomes, while exploitation is more expected to contribute to cost efficiency and profit

advances as well as to efficiency in generating the product, and to the product’s quality

(Kim and Atuahene-Gima, 2010; Molina-Castillo et al., 2011; O’Cass et al., 2014).

Both theoretical and empirical studies verify that the ambidextrous capabilities,

comprising explorative and exploitative capability, are the significant learning abilities

566 E.M. Alamayreh et al.

for organisations to achieve innovation (Benner and Tushman, 2003; Gupta et al., 2006).

Thus, both capabilities can be beneficial to innovation (Atuahene-Gima, 2005). Other

studies conclude that excelling at both exploitation and exploration is crucial to ensure an

effective product development (e.g., Sheremata, 2000). On the other hand, Yalcinkaya

et al. (2007) find that whereas exploitation capabilities are negatively related to the

degree of product innovation, exploration capabilities positively influence the degree of

product innovation.

Many studies conclude that ambidexterity is positively associated with innovation

(Eisenhardt and Tabrizi, 1995; Adler et al., 1999; McGrath, 2001; Katila and Ahuja,

2002; Rothaermel and Deeds, 2004; Yang and Atuahene-Gima, 2007; Rothaermel and

Alexandre, 2008; Burgers et al., 2009; Sarkees and Hulland, 2009; Tushman et al., 2010;

Phene et al., 2012).

In brief, most of theoretical and empirical studies verify the positive relationship

between organisational ambidexterity and innovation.

5 The relationship between innovation and organisational performance

Connecting innovation with organisations’ growth and performance is yet a test to inquire

about. It is hard to detect the impact of new products and processes on organisations’

performance, since it might take quite a while amongst innovation and the financial pick

up of organisations (Faria and Mendonca, 2011).

Innovative organisations can develop new products faster than non-innovative ones.

They are pioneers in taking advantage of market opportunities, which results in their

improved organisational performance (Brown and Eisenhard, 1995). Nam (2007)

concludes that that organisational innovation is likely to be a solid facilitator for

organisational performance; it is likely to be a mediator of internal/external management

factors that affect organisational performance. Furthermore, it has a positive, direct, and

significant mediating impact on organisational performance. Innovation has long been

considered one of the key determinants of organisation’s value, performance, and

survival (Walker, 2004; Chuluuna et al., 2017).

Innovation researchers argue that different innovation methods are first used in

several organisations, and then yield performance in two ways. The first way focuses on

cutting cost and it increases productivity using technology advancement, while the

second way aims at increasing sales by improving the product itself (Martínez-Ros and

Labeaga, 2009). According to Lyon and Ferrier (2002), innovation is frequently

considered an important way of achieving a superior performance in competitive

environments by producing an upgraded market position.

On the other hand, Damanpour et al. (2009) have shown that a primary reason for the

positive effect of innovation on an organisation’s performance is that organisations

innovate to obtain the advantages resulting from being first and from achieving better

performance. Moreover, innovation is crucial not only because it affects the feasibility of

organisations, but also because it influences the social and economic variations, sustains

competitive advantages, survives organisations and improves their performance

(Kalmuka and Acar, 2015).

The literature on innovation has largely agreed that the continuous practice of product

innovation is considered an important determining factor of sustained organisation

performance, renewal and success (Cheng et al., 2010; Slater et al., 2014; Lonial and

The relationship among innovation, organisational ambidexterity 567

Carter, 2015). Therefore, organisations that offer improved products to meet the needs of

target customers and market them quicker and more efficiently than their competitors are

in a superior position to obtain higher performance and generate sustainable competitive

advantages (Alegre et al., 2006). Also, Wu et al. (2014) suggest that product innovation

has the capability to enhance both the organisation’s financial and non-financial

performances. Likewise, a study conducted by Hilman and Kaliappen (2015) concludes

that both the process and the service innovation are positively related to the performance.

Additionally, per Liao et al. (2015), the proof demonstrates that organisational innovation

features, including innovation assets, capabilities, and the strategies to integrate external

resources, emphatically influence organisational sale performance.

So far, a positive relationship between innovation and financial performance can be

expected for at least three reasons. First, organisations responding to customer demands

and impulsive consumer choices are more likely to attain higher levels of sales and

organisation growth (Srinivasan et al., 2009). Second, continuous innovation can produce

indirect benefits due to being able to recognise and obtain new knowledge with possibly

new innovations leading again to financial benefits (Cohen and Levinthal, 1990). Third,

the penetration of sectors with high financial margins can permit the offsetting of

potential costs related to targeting and attracting new customers (Bayus et al., 2003).

Additionally, numerous studies have discussed the relationship between innovation

and organisational performance. For instance, Cheng et al. (2010) conclude that process

innovation has a greater impact on solving conflicts among employees, while product

innovation has a greater impact on organisational performance. Moreover, Camisón and

López (2010) concludes that organisations that pursue manufacturing flexibility should

develop innovation competencies to gain an improvement in the organisational

performance. In addition, from a knowledge-sharing point of view, Appel-Meulenbroek

(2010) illustrate that knowledge sharing enhances the innovation ability, which

eventually facilitates organisations to reach their goals. Likewise, Abdallah et al. (2016)

find that both types of innovation (managerial and technological) have a direct influence

on operational performance. Thus, there is an obvious relationship between

organisational innovation and organisational performance.

Some studies find that innovation does not affect performance (e.g., Birley and

Westhead, 1990; Heunks, 1998; Cembrero and Sáenz, 2018), whereas other studies have

find that innovation is negatively related to performance (e.g., McGee et al., 1995;

Vermeulen et al., 2005). Additionally, Hashi and Stojcic (2010) and Damanpour and

Aravind (2011) emphasise that the relationship between innovation and performance has

not been fully explained, and more empirical studies are still needed in order to clarify it.

Furthermore, Park and Kwon (2018) reveal that the influences of open innovation

strategy on organisation performance are minimal in the manufacturing industry.

In summary, there is a consensus among the majority of empirical studies on the

positive relationship between innovation and performance.

6 Discussions, conclusions and recommendations

The purpose of this review is to explore the literature related to the relationship among

innovation, organisational ambidexterity, and organisational performance.

568 E.M. Alamayreh et al.

Even though some studies find that organisational ambidexterity is seen as an

important predictor of organisational performance, (e.g., Junni et al., 2013; Mom et al.,

2015). Other studies find that ambidexterity does not necessarily guarantee performance

and that the relationship between ambidexterity and performance is more complex (Sirén

et al., 2012). Therefore, the question whether or not ambidexterity leads to an improved

organisational performance is still barely developed, and the results are still inconclusive.

Additionally, there is a clear gap in the existing literature concerning the effect of

innovation types (product and process innovation) on financial and operational

performance (Abdallah et al., 2016). Although most theoretical and empirical studies

have verified the positive relationship between organisational ambidexterity and

innovation, there is a lack of empirical evidence in the literature exists that regarding the

effect of organisational ambidexterity on innovation (e.g., Sarkees and Hulland, 2009;

Tushman et al., 2010; Phene et al., 2012). There is also a paucity of studies that explore

the relationship among innovation, organisational ambidexterity and organisational

performance (e.g., Benner and Tushman, 2003; He and Wong, 2004), and they find that

innovation has a mediating effect on the relationship between organisational

ambidexterity and organisational performance.

Consequently, it is recommended for future research to study the mediating effect of

innovation on the relationship between organisational ambidexterity and organisational

performance. Alternatively, studies need to be conducting on whether there is a

moderating effect of innovation on the aforementioned relationship. It is also

recommended to managers to understand the importance leadoff leading their

organisations toward ambidexterity since it will affect their organisational performance

and the innovation plans.

Acknowledgements

The authors are grateful to the editor and blind reviewers of the International Journal of

Business Innovation and Research for their valuable comments and feedback.

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Strategic knowledge, IT capabilities and innovation ambidexterity: role of business process performance

Article

Jan 2024
IND MANAGE DATA SYST

Purpose The research aims to identify the impacts of strategic knowledge (SK) and information technology capabilities (ITC) on innovation ambidexterity (IAM) through business process performance (BPP). Design/methodology/approach The research framework is developed based on the theoretical grounding of resource orchestration (RO) (SK and ITC) impacts on IAM. The structural equation modeling (SEM) technique was used to test the research framework on a sample of 441 responses from Brazilian firms. Findings The results suggest that SK and ITC facilitate BPP, resulting in IAM. The findings also suggested differences in path coefficients in the SK and ITC of the business value generation process framework under environmental turbulence (ET). Finally, a strong SK of ITC is especially important in enabling BPP and IAM in large firms. Another case of most manufacturing and service firms demonstrated that both SK and ITC are essential to impacting IAM through BPP mediation. Practical implications The findings provide insight into how professionals can think and plan carefully to align SK and ITC for achieving balanced innovation and improving BPP in the dynamic business environment. Originality/value The study establishes a relationship between SK, ITC, BPP and IAM. The study developed novel constructs of SK and ITC and tested them, which gives new insight and links among the constructs.

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Our study explores the critical role played by organizational ambidexterity capabilities in the link between Big Data Analytics, strategic innovation capabilities, and innovation performance. We developed a conceptual framework based on resource-based and dynamic capabilities views to examine the direct and indirect relationships among main variables. We used a quantitative approach to collect data from 172 Saudi IT and Telecom firms. We then employed structural equation modeling through Smart-PLS to test the study hypotheses. Our findings revealed that Big Data Analytics and strategic innovation capabilities have a significant impact on organizational ambi-dexterity and then on innovation performance. Ambidexterity capability mediates between big data analytics capabilities and innovation performance and between strategic innovation capabilities and innovation performance. Our study contributes to the literature on Big Data and innovation. It offers valuable insights into the potential impact of big data analytics, strategic innovation, and ambidexterity capabilities on innovation performance. It demonstrates how significantly boosting a firm’s capabilities for improved firms' innovation performance can potentially enhance performance outcomes (e.g., competitiveness and sustainability). These findings provide managers with meaningful implications regarding innovation performance that can be achieved by leveraging these important resources and capabilities.

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This research examines the effect of knowledge management on organizational performance, with dynamic capability as a mediating variable. A quantitative research approach was applied. A survey was conducted using purposive random sampling. Data were collected manually by using a questionnaire. SmartPLS3 was used to analyze the data. The results showed that dynamic capability has been verified to mediate the relationship between knowledge management and performance. Greater knowledge management leads to higher performance, especially if the mediated dynamic capability is also greater. The managerial implications were that knowledge management and dynamic capability have prominent roles in organizational performance. Knowledge management and dynamic capability allow managers to optimize their creativity and innovation to develop ideas, which helps maximize the growth of organizational performance. The results supported the knowledge-based view (KBV). KBV serves as the foundation for comprehension of knowledge-based organizational theory. Knowledge significantly affects sustainable performance.

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Pradeep Paraman

The challenges of the global business environment foster small medium-sized enterprises (SMEs) to continuously improve their performance in the level of vulnerability to possible impacts and interruptions in their operations that may affect their sustainability. Resilience strategies and ambidextrous capabilities have become important determinants of organizational performance, which has developed as an emerging area of interest in supply chain management in recent years. SMEs are one of the major contributing sectors to the Malaysian economy. Therefore, SMEs have been forced to survive in the current market situation to ensure higher economic growth and competitiveness. The resilience strategies and ambidexterity capabilities are important determinants of SMEs’ performance. As such, this study aims to examine the relationship between proactive resilience strategies, ambidextrous capabilities, and the performance of SMEs in the manufacturing sector, drawing on the dynamic capabilities perspective. A quantitative research design is adopted, a structured survey questionnaire is used, and data are collected from 351 SMEs in the manufacturing sector. Partial least squares structural equation modeling (PLS-SEM), Smart PLS 3.0 is used to test both direct and mediating results. The findings of this study suggested that proactive resilience strategies may have a significant influence on organizational performance of SMEs. Ambidextrous capabilities also act as a strong mediator between proactive resilience strategies and organizational performance. These findings contribute to the dynamic capabilities literature by highlighting the importance of proactive resilience strategies and ambidextrous capabilities in enhancing the positive impact on organizational performance in SMEs. This study provides a plausible explanation of two important management mechanisms for enhancing organizational performance sustainability. The relationships between proactive resilience strategies, ambidextrous capabilities, and organizational performance are malleable. This study also suggests that fostering formal and informal relationships might hold the key to the sustainable performance of SMEs in the long term. This study’s practical contributions are improving the knowledge and performance of supply chain systems for SMEs in the manufacturing sector and enhancing their competitive power in domestic and international markets.

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The study investigates how the alignment at the processing levels between information systems (IS) strategy, through strategy-as-practice approach, and innovation influences corporate performance (CP) under environmental uncertainty from 856 Brazilian firms by PLS-SEM. The results indicated that all approaches of alignment between IS strategy and innovation have strong influences on CP. The alignment with ambidextrous innovation had a 62% higher contribution on CP than alignment between exploitative innovations. Additionally, exploitative innovations had positive effects on CP under high hostility environments; and explorative and ambidextrous innovations had positive large and strong effects on CP under high dynamic environments.

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Jun 2023
Int J Bus Innovat Res

As an emergent phenomenon offering pathways towards sustainability, the sharing economy is a generic category representing multiple entrepreneurial ventures or sharing-based programs (SBPs). To become viable, SBPs must position themselves regarding, and obtain legitimacy from, other stakeholders. The nature of this self-presentation strategy and legitimacy granting process is mostly unknown. This paper aims to fill this gap by analysing how 40 SBP present themselves and the nature of legitimacy granted by 95 stakeholders to four prototypical SBPs. Results reveal that SBPs claim to be a part of a global movement, acting as agents of change in contemporary matters: the widespread prevalence of information technologies; the desirability of empowering people; social cohesion as a requirement in a globalised world; sustainability as a precondition of a more auspicious world. External audiences have granted legitimacy to SBPs through four types of legitimation: sameness, distinctiveness, cognitive and, to a less extent, socio-political.

Disclosure of Organizational Ambidexterity Activities and Earnings Quality in Oman

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Purpose: This study examines the association between organizational ambidexterity disclosure (OAD) and earnings quality (EQ) in terms of earnings persistence (PER) and value relevance (VR). Theoretical framework: Organizational ambidexterity disclosure (OAD) is one type of forward-looking disclosure (FLD) which includes all information about exploration and exploitation activities. In accounting, the study is interested in how (OAD) affects the firm’s earnings quality. Design/methodology/approach: This study uses the secondary data of non-financial industrial and services firms listed on the Muscat Securities Market (MSX) in Oman for a 5-year period from 2017–2021. The study uses generalized least square (GLS) and feasible general least squares (FGLS) regressions to test the hypotheses and find the results. Findings: Results of the GLS and the robust results of FGLS show that OAD has a positive and significant effect on earnings persistence (PER) and value relevance (VR) and the coefficient of VR is stronger than the coefficient of PER, indicating the importance of OAD on the earnings quality as new evidence in the area of accounting. Research Implications: The results provide crucial implications for researchers, investors, policy makers and managers. The study provides potential leverage points for those responsible for shaping the disclosure and transparency because of it insights on when OAD impacts EQ. Originality/value: This study offers a novel resource-based perspective to explain how Omani firms achieve higher sustainable and value relevance earnings by investing in OA. It also provides new evidence about how an ambidextrous firm improves the sustainable and value relevance earnings.

Physical environment and employee commitment: a moderating role of work autonomy

Article

Jan 2022

The purpose of this paper is to examine the impact of physical environment on employee commitment with a moderating role of work autonomy. The questionnaire was formed on the basis of previously validated methods. 269 employees from various information technology (IT) companies were interviewed. Confirmatory factor analysis (CFA) is used to establish the reliability and validity measurements and a moderated structural equation modelling (MSEM) is used to test the hypothesis. The result of the study showed an optimistic influence of work autonomy on physical environment and employee commitment. Since the study was undertaken in IT firms, the generalisation of the same across other sectors is not possible and therefore a scope for further studies. The research tries to bring a three dimensional model highlighting the importance of work autonomy combining physical environment and employee commitment. Keywords: physical environment; PE; work autonomy; WA; employee commitment; EC; confirmatory factor analysis; CFA; moderated structural equation modelling; MSEM. DOI: 10.1504/IJBIR.2022.122490 International Journal of Business Innovation and Research, 2022 Vol.27 No.4, pp.446 - 461

Physical Environment and Employee Commitment: A Moderating Role of Work Autonomy

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Something Old, Something New: A Longitudinal Study of Search Behavior and New Product Introduction

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Managing Innovation is the bestselling text for graduate and undergraduate students and a classic in the field. Emphasizing practical, evidence based tools and resources, this title provides students with the knowledge base to successfully manage innovation, technology, and new product development. The holistic approach addresses the interplay between the markets, technology, and the organization, while relating the unique skill set required to manage innovation and innovation processes.

Managing exploration and exploitation in a media organisation – A capability-based approach to ambidexterity

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This study contributes to emerging research on management of organisational tensions in the media industry. We approach the topic by utilising the concept of ambidexterity, which has hardly been applied to media organisations. The goal of this study is to provide a capability-based approach to organisational ambidexterity. Thus, we offer a new approach for analysing media management by operationalising ambidexterity with operational and dynamic capabilities. The study analyses what kinds of tensions ambidexterity creates between managerial operational and dynamic capabilities. The empirical analysis is based on interviews with top-level managers at the Finnish Broadcasting Company, Yle, during 2013/14. The approach is qualitative. The results are presented by using our theoretical approach of combining exploration and exploitation (ambidexterity) with sensing and seizing (dynamic and operational capabilities).

Lead and Disrupt: How to Solve the Innovator's Dilemma, Second Edition

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A STUDY OF THE PRACTICE OF THE LEARNING ORGANIZATION AND ITS RELATIONSHIP TO PERFORMANCE AMONG KENYAN COMMERCIAL BANKS

Article

Jul 2012

The objective of the study was to investigate the extent of the practice of the learning organization within the Kenyan commercial banks and determine the relationship between the aforementioned practice with organizational performance. The study adopted a descriptive survey design. It was a census survey comprising all the 43 banks licensed to operate in Kenya under the banking Act. The sample frame included all the commercial banks listed in the Central Bank of Kenya website. The 43 banks were further divided into 3 tiers based on profitability for the year 2008 as indicated in the Banking Survey 2009. Primary data was collected using a structured questionnaire while secondary data regarding organizational performance was obtained from the banking survey 2009. The data collected was analysed using descriptive statistics in terms of frequency and percentage tabulations, cross tabulations and Pearson’s correlation coefficient to determine the relationship between the practice of the learning organization and organizational performance. The study established that most Kenyan commercial banks had to a large extent adopted the following practices adopted by most organizations: development of information systems designed to inform and empower, formative accounting control, learning approach to strategy development, participative policy making, reward flexibility and supportive leadership. The practices least adopted were the ones involved in enabling structures, creating a learning climate and boundary workers as environmental scanners. Findings indicate that there is an inverse relationship between the practice of the learning organization and organizational performance. This would suggest that there are other factors that have to be taken into account to determine and explain this discrepancy, hence the need for further study. In conclusion, the study established that two thirds of the Kenyan banks had adopted the practices of the learning institution. The study also indicates that there is a tendency for Kenyan commercial banks to focus on certain aspects of the learning organization instead of seeing the whole picture and focusing on the organization as a dynamic entity. Interest in the learning organization has been stimulated by the need to attain sustainable competitive advantage The researcher recommends that the Kenyan commercial banks should embrace more systematic, definite and concrete steps towards adopting a learning culture, in order to survive the onslaught of competitive forces in the global market. The study suggests further investigation into whether the practices were adopted as part of a systematic strategy to develop the banks as learning organizations or whether they were simply adopted on an ad hoc basis for purposes of expediency and organizational survival. Key words: learning organization, organizational learning culture, performance indicators, sustainable competitive advantage, global business environment.

The Antecedents, Consequences, and Mediating Role of Organizational Ambidexterity

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Effects of innovation types on firm performance: an empirical approach in South Korean manufacturing industry

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Identifying and assessing innovation factors in construction projects in Palestine: An empirical study

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Jan 2017

There seems to be scarcity in the current literature of empirical studies that explores project management innovation capabilities in developing countries in terms of factors potentially affecting its exploitation. This research aims at investigating, assessing, and discussing potential drivers, barriers, enablers and impacts for project management innovation processes in the context of Palestinian construction projects using a mixed methods approach. Based on systematic literature review and semi-structured interviews with construction projects experts, a specially designed project management innovation assessment survey has been conducted with managers within construction projects' firms operating in the West Bank region of Palestine. A total of 1,000 surveys were electronically distributed, out of which 360 surveys returned usable data. The results of the analysis show that managers in the construction sector often perceive cost reduction as the most critical driver for project management innovation, and that the rewarding system is the main enabler for innovation, while the main barrier to innovation is the lack of effective management and the main impact of innovation is creating a competitive advantage. The value of this paper is the identification of project management innovation's affecting factors in developing countries, and how innovation dynamics intersects with organisational well-being in such environments.

The relationships between soft/hard total quality management practices and operational performance in Jordanian manufacturing organisations

Article

Jan 2017

The relationships between soft/hard total quality management practices and operational performance in Jordanian manufacturing organizations Abstract: Previous studies in the field of total quality management (TQM) reported mixed results regarding their relationships with performance. This study, therefore, seeks to investigate the relationships between soft/hard TQM practices and operational performance in Jordanian manufacturing organizations. A questionnaire survey was distributed among the population of the research which consisted of (170) Jordanian manufacturing organizations, certified by ISO 9001 certification. Data obtained from the respondents were then statistically analyzed using simple and multiple linear regression analysis to test the research hypotheses. The results of this study confirmed the importance of soft and hard TQM practices to operational performance, and showed that soft TQM practices were more significant than hard TQM practices in their relationships with operational performance. Based upon this results, Jordanian manufacturing organizations should formulate a strategy that considers the importance of soft TQM practices for improving operational performance, and undertaking an integrative paradigm in implementing TQM. Keywords: Total quality management; Soft practices; Hard practices; Operational performance; Manufacturing organization; Jordan.

Innovation development in service firms: A three-model perspective

Article

Jan 2017

Thomas Anning-Dorson

This paper develops a three-model approach through the dynamic capability view to showcase the forms and dimensionalities service innovation could take. The paper explains that the different resource and capability-base for firms provide the source of variation for innovation. These capabilities allow service firms to create and implement innovation through their service mix that represents basic competitive tools for service engagement, interaction with customers and through the market as a result of external capability activation. The approach recommends the development of innovation with the service mix which is the basic competitive tool for service firms; through the customer-firm interface that enables value co-creation; and the market that allows the firm to capitalise upon its external capabilities. These service innovation dimensions therefore determine how well a service firm performs on the market in both the short and long-term.

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