Ambidexterity – managing innovation and core business simultaneously

These two very different basic logics do not work in parallel – at least not without proper management. Those who optimize routine processes hardly succeed in mentally detaching themselves from the established structures. Those who research and explore new business opportunities are often thwarted by rigid structures designed for efficiency.

• Contextual Ambidexterity
  Contextual ambidexterity combines exploitation and exploration within a unified structure. An example of this is Google, whose employees invest 20 percent of their working time in innovative topics away from day-to-day business. However, both strands need to be managed wisely by leaders.
• Structural Ambidexterity
  Structural ambidexterity is made possible by an organizational, and often also spatial, separation that allows simultaneous processing of exploitation and exploration. This is done, for example, by creating separate organizational units, each focusing on one of the two strands.

Both approaches place great demands on managers. Regardless of which path they choose, they must manage the two different basic logics and the resulting paradoxes intelligently and constructively.

Ambidexterity cannot be achieved in the blink of an eye and poses numerous challenges for the organization, its managers, and its employees. Why is it still worth the effort?

Organizations have a tendency of repeating past patterns of success. But at a certain point, these are no longer the right solution to the current problem. Framework conditions change and small adjustments made in previous years or even decades are no longer sufficient. Completely new routines, processes, ways of working or strategies are needed in order to be able to continue as an organization.

Ambidextrous organizations find it easier to recognize this point early on and adapt to it with innovative solutions.

Organizations that succeed in creating ambidexterity usually have some advantages over other organizations:

• They are more competitive because they are active in existing markets and also enter into new markets
• They are more adaptive, because the creation of ambidexterity is usually accompanied by structural adjustments that strengthen the adaptive capacity of the organization
• They ensure effective knowledge and information transfer, as the two strands of exploitation and exploration must be well linked to have full effect
• They teach their leaders to think ahead, as ambidextrous leaders always keep an eye on shaping the future. In addition, ambidextrous leaders turn into helpful impulse generators for the need for change in the organization
• They develop a modern, innovative corporate culture in which mistakes and breaking new ground are seen as learning opportunities, and provide space for creative thinking
• They are more characterized by trust, as employees take responsibility, especially in the exploratory strand, while managers learn to let go of the reins

On our website, you will find further information and corresponding consulting and service offers that will help you to establish structures and routines in your organization that enable and promote organizational ambidexterity: