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The Performance Consequences of Ambidexterity in Strategic Alliance Formations: Empirical Investigation and Computational Theorizing

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Author Info

  • Zhiang (John) Lin

    ()
    (School of Management, University of Texas at Dallas, Richardson, Texas 75080)

  • Haibin Yang

    ()
    (Department of Management, City University of Hong Kong, Kowloon, Hong Kong)

  • Irem Demirkan

    ()
    (School of Management, University of Texas at Dallas, Richardson, Texas 75080)

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    Abstract

    Although alliance studies have generally favored an ambidextrous approach between exploration and exploitation, they tend to overlook a firm's characteristics, its industry constraints, or the dynamic network in which the firm is embedded. This study examines the ambidexterity hypothesis and its boundary conditions with a unique research method. We not only analyze empirical data from five U.S. industries spanning eight years, but also expand theoretical insights to the network level by building a computer simulation model. Both our empirical and simulation results reveal the contingencies of the ambidexterity hypothesis in alliance formation. Our findings show that although an ambidextrous formation of alliances benefits large firms, a focused formation of either exploratory or exploitative alliances benefits small firms. In an uncertain environment an ambidextrous formation enhances firm performance but so does a focused formation in a stable environment. Finally, the simulation model demonstrates that a firm's centrality and structural hole positions in network relations can moderate the relationships between alliance formation choices and firm performance, and that the ambidexterity hypothesis may be limited to the earlier stage of the network. Our study provides critical evidence into the viability of adopting a dynamic network perspective in understanding the ambidexterity hypothesis and advancing strategic alliance research beyond static and dyadic levels.

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    File URL: http://dx.doi.org/10.1287/mnsc.1070.0712
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    Bibliographic Info

    Article provided by INFORMS in its journal Management Science.

    Volume (Year): 53 (2007)
    Issue (Month): 10 (October)
    Pages: 1645-1658

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    Handle: RePEc:inm:ormnsc:v:53:y:2007:i:10:p:1645-1658

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    Related research

    Keywords: alliance formation; ambidexterity hypothesis; social networks; empirical analysis; computer simulation;

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    Cited by:
    1. Li, Peter Ping, 2010. "Toward a learning-based view of internationalization: The accelerated trajectories of cross-border learning for latecomers," Journal of International Management, Elsevier, vol. 16(1), pages 43-59, March.
    2. Yamakawa, Yasuhiro & Yang, Haibin & Lin, Zhiang (John), 2011. "Exploration versus exploitation in alliance portfolio: Performance implications of organizational, strategic, and environmental fit," Research Policy, Elsevier, vol. 40(2), pages 287-296, March.
    3. Subramanian, Annapoornima M. & Lim, Kwanghui & Soh, Pek-Hooi, 2013. "When birds of a feather don’t flock together: Different scientists and the roles they play in biotech R&D alliances," Research Policy, Elsevier, vol. 42(3), pages 595-612.
    4. Heinrichs, Simon & Walter, Sascha, 2013. "Don’t Step Into Your Parent’s Shoes – How Exploitation and Exploration Affect Spin-out Growth," EconStor Preprints 68591, ZBW - German National Library of Economics.
    5. Vanhaverbeke, Wim & Li, Ying & Van de Vrande, Vareska, 2009. "The dual role of external corporate venturing in technological exploration," MPRA Paper 26488, University Library of Munich, Germany, revised 2010.
    6. O'Reilly, Charles A., III & Tushman, Michael L., 2013. "Organizational Ambidexterity: Past, Present and Future," Research Papers 2130, Stanford University, Graduate School of Business.
    7. Jansen, J.J.P. & Tempelaar, M.P. & van den Bosch, F.A.J. & Volberda, H.W., 2008. "Structural Differentiation and Ambidexterity: The Mediating Role of Integration Mechanisms," ERIM Report Series Research in Management ERS-2008-072-STR, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus Uni.
    8. Zhongfeng Su & Jingyu Li & Zhiping Yang & Yuan Li, 2011. "Exploratory learning and exploitative learning in different organizational structures," Asia Pacific Journal of Management, Springer, vol. 28(4), pages 697-714, December.
    9. Prange, Christiane & Verdier, Sylvie, 2011. "Dynamic capabilities, internationalization processes and performance," Journal of World Business, Elsevier, vol. 46(1), pages 126-133, January.

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