Explore or exploit? How explorative and exploitative IT capabilities affect new product development process performance

This study investigates how explorative and exploitative IT capabilities drive performance across concept development, product development, and implementation stages of the new product development (NPD) process, and how environmental dynamism re-weights their effects. Drawing on survey data from 279 German innovation professionals and employing PLS-SEM alongside a polynomial-regression/response-surface analysis, we first show that treating IT exploration and IT exploitation as distinct dimensions uncovers their separate and joint contributions to stage-level outcomes. Both capabilities positively influence each NPD stage, but exploration yields its greatest marginal benefit during implementation, whereas exploitation exerts a steady effect across all stages. Response-surface results reveal that optimal performance is achieved not at a rigid 50:50 balance but at a context-sensitive, slightly exploitative-leaning ratio whose ideal position shifts as projects progress. Finally, environmental dynamism amplifies the value of explorative IT capabilities while attenuating that of exploitative IT capabilities. In turbulent settings firms benefit from heavier IT investment in exploration, whereas stable environments favor exploitation. These findings advance ambidexterity theory by challenging perfect balance assumptions, opening the NPD black box to reveal stage-specific digital mechanisms, and positioning environmental turbulence as a first-order boundary condition for IT strategy.