Strategic Ambidexterity and Platform Firm Performance
Journal
IEEE Transactions on Engineering Management
Journal Volume
71
Start Page
11407
End Page
11420
ISSN
0018-9391
1558-0040
Date Issued
2024
Author(s)
DOI
10.1109/TEM.2024.3416406
Abstract
Successful organizations thrive by achieving a balance between maintaining alignment in their current operations and being adaptable enough to navigate a constantly changing business environment. This study aims to fill a critical gap in the understanding of how ambidexterity strategies impact the performance of platform business models. Currently, there is limited knowledge of the potential synergies or tradeoffs that may arise from the simultaneous implementation of exploration and exploitation strategies. We argue that strategic combinations of platform exploration with capabilities exploitation may not always yield advantageous results. Our analysis, based on panel data of 1183 cases from U.S. platform companies, supports most of the hypotheses. The findings reveal that both market and product-oriented exploration undertaken by platform firms positively impact performance. However, ambidextrous strategies, which emphasize both exploration and exploitation within and across functional domains, lead to negative performance outcomes. These empirical results offer new insights into the ambidexterity paradoxes concerning adaptability and alignment within the platform context. Our findings suggest that managers should adopt a sequential approach to ambidexterity instead of a simultaneous one. This study contributes to the literature on ambidexterity and platform strategy, encompassing research on the consequences of ambidexterity, organizational adaptation, cross-boundary perspectives, and platform capabilities.
Subjects
Ambidexterity
exploitation
exploration
firm performance
platform
Publisher
Institute of Electrical and Electronics Engineers (IEEE)
Type
journal article