Opening a black box: The moderating effect of managing dualities on the relation between explorative and exploitative activities and business performance in manufacturing firms

Abstract

Research on ambidexterity and continuous innovation predominantly assumes a positive relationship between ambidextrous behaviour and business performance in manufacturing firms. Scholars agree that this positive effect is moderated by the firm's capability in aligning explorative and exploitative activities through the management of dualities (MoD). Direct empirical evidence for this relationship is yet still missing, with the management of dualities (MoD) being treated as a black-boxed construct. In this article, we open this black box by defining the elements of the MoD construct as connectedness, involvement, coordination and strategic alignment. We then test the assumption that MoD moderates the relationship between exploitative and explorative activities and business performance with data from a survey with 188 manufacturing firms. We find different direct and moderating effects for connectedness, involvement and coordination over business performance, but not for strategic alignment. Based on our analysis, we present a differentiated first explorative picture of the choices, benefits and trade-offs associated with managing dualities in manufacturing firms.