The performance effects of balancing exploration and exploitation within and across governance modes

Uriel Stettner, Dovev Lavie

Research output: Contribution to conferencePaperpeer-review

Abstract

Acknowledging interdependence in firms' tendencies to explore versus exploit across governance modes, we claim that balancing these tendencies within each mode undermines performance as a result of resource allocation constraints, limits to specialization, and tension between conflicting routines. Nevertheless, by exploring in one mode while exploiting in another, firms can overcome these impediments and enhance performance. Furthermore, exploration via externally-oriented modes such as acquisitions or alliances enhances performance more than exploration via internal development. Analysis of 190 publicly-traded U.S.-based software firms furnishes support to these conjectures and sheds new light on Jim March's balance hypothesis.

Original languageEnglish
DOIs
StatePublished - 2011
Event71st Annual Meeting of the Academy of Management - West Meets East: Enlightening, Balancing, Transcending, AOM 2011 - San Antonio, TX, United States
Duration: 12 Aug 201116 Aug 2011

Conference

Conference71st Annual Meeting of the Academy of Management - West Meets East: Enlightening, Balancing, Transcending, AOM 2011
Country/TerritoryUnited States
CitySan Antonio, TX
Period12/08/1116/08/11

Keywords

  • Ambidexterity
  • Exploration and exploitation
  • Governance mode

All Science Journal Classification (ASJC) codes

  • Industrial relations
  • Management of Technology and Innovation
  • Management Information Systems

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