The role of identity for achieving organizational ambidexterity in incumbent firms

Paul, Alexander; Antons, David (Thesis advisor); Paluch, Stefanie (Thesis advisor)

Aachen : RWTH Aachen University (2023)
Dissertation / PhD Thesis

Dissertation, Rheinisch-Westfälische Technische Hochschule Aachen, 2023


While a substantial body of research has addressed the challenges of companies when pursuing organizational ambidexterity - the dilemma of balancing short-term profits with longterm competitiveness - from different perspectives, the current research landscape on ambidexterity seems to lack vital answers to pressing firm challenges. While the issue of ambidexterity has gained significant attention, the long-term trend of declining corporate longevity of S&P 500 firms is projected to reach 15.7 years in 2028 - one of the lowest lifespans observed in the history of this index. Firms therefore seem to struggle with the dynamic market environment nowadays and either cannot find the right answers to their challenges or their current pain points are not yet represented within the organizational ambidexterity literature. Therefore, this dissertation is about how organizations can manage and solve the tension between devoting enough resources to ensuring their future competitiveness while at the same time ensuring efficient operations and profits in the short-term. Research on organizational ambidexterity has largely focused on the necessary requirements firms need to tackle for achieving a balance between exploring the new and exploiting the known. From this, past studies derived three systematical ways for achieving organizational ambidexterity which comprise structural segmentation of business units, sequential separation of firm activities, and providing individuals with the context for pursuing ambidexterity on their own - each coming with distinct characteristics and prerequisites. The objective of this dissertation is to clear the fog on the topic of organizational ambidexterity and identify why companies seem to have a rough ride ensuring their long-term survival in these volatile times. In the three independent research essays provided in this dissertation, I identified two specific challenges of organizations when it comes to balancing exploration and exploitation. With essay 1, I qualitatively dig into the prerequisites for achieving individual ambidexterity, showing that our current understanding of how individuals integrate exploration and exploitation needs to go beyond role switching behaviors. Instead, individuals may rather need to construct an "ambidextrous" role identity based on organizational demands and personal influences. In essay 2, I validate these findings using regression analyses of survey data. I find that individuals who augment organizational role demands with personal characteristics can achieve higher levels of ambidexterity than individuals who perceive solely explorative or exploitative role and personal identities. Essay 3 then revolves around how organizations can integrate the activities of explorative business units into their core operations. My findings highlight that a company’s ability to integrate explorative activities may depend on its capability to facilitate organizational identity change. I derive four boundary factors that influence organizational identity change and show why companies can find it very difficult to change their identity even when new market demands have been recognized from an early stage. Overall, the findings of my dissertation prepare firms to better tackle the paradoxical tensions arising from balancing exploration and exploitation. By identifying unaddressed challenges within the organizational ambidexterity literature, this dissertation provides a new lens on how companies should navigate the dilemma of exploring new businesses while exploiting their current market position.