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

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  • 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)

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.

Suggested Citation

  • Zhiang (John) Lin & Haibin Yang & Irem Demirkan, 2007. "The Performance Consequences of Ambidexterity in Strategic Alliance Formations: Empirical Investigation and Computational Theorizing," Management Science, INFORMS, vol. 53(10), pages 1645-1658, October.
  • Handle: RePEc:inm:ormnsc:v:53:y:2007:i:10:p:1645-1658
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    File URL: http://dx.doi.org/10.1287/mnsc.1070.0712
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. 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.
    2. Dai, Ye & Du, Kui & Byun, Gukdo & Zhu, Xi, 2017. "Ambidexterity in new ventures: The impact of new product development alliances and transactive memory systems," Journal of Business Research, Elsevier, vol. 75(C), pages 77-85.
    3. Francisco García-Lillo & Mercedes Úbeda-García & Bartolomé Marco-Lajara, 2016. "Organizational ambidexterity: exploring the knowledge base," Scientometrics, Springer;Akadémiai Kiadó, vol. 107(3), pages 1021-1040, June.
    4. Justin J. P. Jansen & Michiel P. Tempelaar & Frans A. J. van den Bosch & Henk W. Volberda, 2009. "Structural Differentiation and Ambidexterity: The Mediating Role of Integration Mechanisms," Organization Science, INFORMS, vol. 20(4), pages 797-811, August.
    5. 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.
    6. 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.
    7. repec:eee:iburev:v:26:y:2017:i:5:p:942-958 is not listed on IDEAS
    8. 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.
    9. Rachel Bocquet & Caroline Mothe, 2015. "Can a governance structure foster cluster ambidexterity through knowledge management? An empirical study of two French SME clusters," Post-Print hal-01132584, HAL.
    10. Massimo Colombo & Liliana Doganova & Evila Piva & Diego D’Adda & Philippe Mustar, 2015. "Hybrid alliances and radical innovation: the performance implications of integrating exploration and exploitation," The Journal of Technology Transfer, Springer, vol. 40(4), pages 696-722, August.
    11. repec:eee:respol:v:46:y:2017:i:5:p:881-897 is not listed on IDEAS
    12. O'Reilly, Charles A., III & Tushman, Michael L., 2013. "Organizational Ambidexterity: Past, Present and Future," Research Papers 2130, Stanford University, Graduate School of Business.
    13. 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.
    14. repec:bla:stratm:v:38:y:2017:i:2:p:384-394 is not listed on IDEAS
    15. Prange, Christiane & Verdier, Sylvie, 2011. "Dynamic capabilities, internationalization processes and performance," Journal of World Business, Elsevier, vol. 46(1), pages 126-133, January.
    16. Uriel Stettner & Dovev Lavie, 2014. "Ambidexterity under scrutiny: Exploration and exploitation via internal organization, alliances, and acquisitions," Strategic Management Journal, Wiley Blackwell, vol. 35(13), pages 1903-1929, December.
    17. Christine Chou & Steven O. Kimbrough, 2016. "An agent-based model of organizational ambidexterity decisions and strategies in new product development," Computational and Mathematical Organization Theory, Springer, vol. 22(1), pages 4-46, March.
    18. Yanfeng Zheng & Haibin Yang, 2015. "Does Familiarity Foster Innovation? The Impact of Alliance Partner Repeatedness on Breakthrough Innovations," Journal of Management Studies, Wiley Blackwell, vol. 52(2), pages 213-230, March.
    19. 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.
    20. Koen H. Heimeriks & Christopher B. Bingham & Tomi Laamanen, 2015. "Unveiling the temporally contingent role of codification in alliance success," Strategic Management Journal, Wiley Blackwell, vol. 36(3), pages 462-473, March.
    21. Michele Cincera & Pierre De Clercq & Thomas Gillet, 2015. "Optimal Openness Level and Economic Performance of Firms: Evidence from Belgian CIS Data," iCite Working Papers 2015-14, ULB -- Universite Libre de Bruxelles.

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