8 minute read
Takeaway: Although the Ambidextrous Organization may have been a useful concept in the 1970s and 1980s when it was in its infancy, it is a constraint on design thinking in the present day and should be confined to history.
There has been much talk and even more published over recent years about the concept of the ‘Ambidextrous Organization’. The term has become synonymous with an organization design concept that delivers a strategic intent to be innovative and responsive on the one hand whilst continuing to deliver effectively and efficiently on the other; an organization that is efficient in its management of today’s business and also adaptable to coping with tomorrow’s changing demand, an organization that uses both exploration and exploitation techniques to be successful.
In today’s business environment it would be surprising to find an organization that doesn’t face this challenge, other than one whose sole strategic intent is to exploit existing markets and technologies by being a fast follower delivering low-cost generics through an operational excellence model.
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In doing so I reference what I consider to be key milestones in the development of the idea of ambidexterity, for the purposes of a short blog post I have referenced a few leading thinkers in the field. This is not a reflection on the immense value of the work of the many I have omitted, purely a shortage of space – I am more than happy to provide a full reference list for those who want to research this topic further.
A brief history of ‘Ambidextrous Organization’
1970’s
It is worth reminding ourselves that the term ‘Ambidextrous Organization’ entered the vocabulary of organization science in the 1970s, possibly first being headlined by Robert B Duncan in 1976[1].
In the same decade, university students were being introduced to the role of nature and nurture in human development and the theory of left brain/right brain dominance, both being presented as binary concepts; nature or nurture? left brain or right brain? Therefore, it should come as no surprise that the early organization design concepts of Duncan et al were to a large extent binary. In this traditional view of ambidexterity, organizations chose to split organizational boundaries or units between either explorative work or exploitative work with simple pass-offs across the boundaries. This was manifest by organization structures that included a separate and discreet ‘R&D’ style function, often geographically as well as organizationally separated from the rest of the company and the customer.
1990’s
The idea of the Ambidextrous Organization then lay comparatively dormant in the field of organization science for around twenty years until it then reemerged as a topic of research interest, perhaps in response to advances in technology and an ever-increasing pace of change?
Michael Tushman and Charles O’Reilly III had both explored the concept in earlier work but their joint paper [2] arguably brought it back to center stage. They hypothesized that organizational ambidexterity, which they defined as “The ability to simultaneously pursue both incremental and discontinuous innovation”, was required for long-term survival.
However, in further development of the concept, Tushmann and O’Reilly highlighted the fact that the so-called Ambidextrous Organization presented a design challenge when hosting contradictory structures, processes, and cultures within the same organization. They recognized that the designer is faced with much more than a binary choice about where to put boundaries around work and that the designer must develop mechanisms that integrate the apparently conflicting objectives of continuously improving the way work is done vs starting again on something new. Still, even in the mid-’90s, there is very little reference to the customer in the development of design choices.
21st Century
Come the 21st century, with its ever-increasing pace of change enabled by better and cheaper technology driven by increasing customer demands, the simple explore vs exploit dichotomy was considered no longer sufficient to explain how organization structures were evolving. In 2004 Julian Birkinshaw and Cristina Gibson [3] proposed that the two facets of Organizational Ambidexterity, exploring and exploiting, should be reimagined under one of two categories – structural and contextual.
We are now seeing the idea of multi-capability teams being introduced to address the boundary issues that had been identified earlier.
Finally, in this whistle-stop tour of the evolution of the concept, we land in 2019 where Jan Ossenbrink, Joern Hoppmann and Volker H. Hoffmann have introduced the concept of hybrid ambidexterity to explain their observed situation of organizations facing multiple strategic choices, leading the organization to invest in initiatives that combine elements of both structural and contextual ambidexterity – hybrid ambidexterity.
The future of ambidexterity?
Back in the 1970s when everything that drove a business strategy was moving much more slowly the concept of ambidexterity worked well for organization designers. Making a binary design choice to draw a boundary around ‘explore’ work and a boundary around ‘exploit’ work with an R&D department, staffed by specialists and isolated from the customer, taking charge of product development served most organizations well. If only the choices we have to make today were still that simple!
Researchers in the field of organization science have recognized that the world has become more complex and have tried to explain this by further developing the ambidexterity concept, increasing the design choices and latterly allowing choices to be combined to further increase the number of options through the hybrid ambidexterity concept.
It is clear that those who research the topic are increasingly struggling to force fit their findings into a binary concept, even when they create new linguistic subsets to enable a better fit. If, as organization designers, we start off with the Ambidextrous Organization as a design goal we are immediately limiting our design choices. In the 21st Century the reality is that being ambidextrous is not enough, most business’ strategies will contain goals to explore new market opportunities whilst exploiting through both effectiveness and efficiency their core business. Being able to explore and exploit at the same time has moved from being a differentiator in the 1970s to being a point of entry today. To succeed, organizations need to be multifaceted, as well as exploring and exploiting to get into the game, they need a compelling customer value proposition to differentiate themselves and win, be that being; product leaders, customer intimate, low-cost, agile, omnichannel, etc.
Part of the art of organization design is in helping teams make the right decisions at the right time in the design process. Recognizing that no organization can be best at everything our role is to help them decide what their primary customer value proposition is. This decision helps drive future decisions about the design criteria for an operating model that will differentiate the organization in its chosen markets.
This is no longer an explore v exploit or a bit-of-both decision, the concept of ambidexterity should be confined to history as we move forward with concept designs that optimize the integration of work to deliver multi-faceted business strategies focused on differentiation through the eyes of the customer.
Conclusion
In conclusion, it is the view of this author that although the Ambidextrous Organization may have been a useful concept in the 1970s and 1980s when it was in its infancy, it is a constraint on design thinking in the present day and should be confined to history.
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Peter Turgoose is a Senior Consultant at ON THE MARK.
OTM is the leading global boutique organization design consultancy with offices in the USA and UK. With over 450 successful redesigns and operating model modernizations completed, OTM is owner of the industry’s most integrated, comprehensive and holistic organization design solution. OTM enables its clients to realize their future ambitions.
[1] Duncan, R. (1976). The ambidextrous organization: Designing dual structures for innovation. Killman R. H., Pondy L. R., and Sleven D., (eds.) The Management of Organization Design. New York: North Holland. 167-188.
[2] Tushman, M. L. & O’Reilly III, C. A. 1996. Ambidextrous organizations: Managing evolutionary and revolutionary change. California Management Review, 38(4): 8-30.
[3] Birkinshaw, J and Gibson, C. (2004) ‘Building Ambidexterity into an Organisation’, MIT Sloan Management Review 45(4) pp 47-55
[4] Ossenbrink, J. Hoppmann, J. and Volker H. Hoffmann, V. H. (2019) ‘Hybrid Ambidexterity: How the Environment Shapes Incumbents’ use of Structural and Contextual Approaches’ Organization Science 2019
