Ambidexterity vs. Disruption: How Does Your Company Adapt To Change?
Have you ever written with the hand that you are not naturally predisposed to using? For most people, it is not only very uncomfortable but also renders less than useful results. However, sometimes we find ourselves in crisis situations that force us to use ‘the other hand’. As awkward as this can be initially, it usually improves with time and often exposes a flexibility to adapt you didn’t know you had. For the most part humans avoid change and working outside of their comfort zones, like the proverbial plague.
The Balance of Change
There is a fine line between enough change to bring about positive results and too much change resulting in upheaval. Nature is a finely tuned change machine. Tides and seasons come and go with an innate equilibrium. However, sometimes an imbalance results in extreme deviations and disasters occur. Interestingly, the upheavals in nature often bring necessary change – a kind of rebooting. As much as we resist the prospect and discomfort of change in life and in business, it is often critical to our survival. On a global scale, we see examples of change daily. Revolutions and technological innovations constantly change the way the world works. This extends to personal change too. Despite our innate aversion to change, one indisputable fact remains –it brings growth – if we embrace it. People and organizations with deeply ingrained beliefs often find this the hardest, with dire consequences. Research shows that smaller adaptable entities have the best chances of survival. In fact, they are optimized to thrive in seasons of environmental disruption. That is the power of ambidexterity.
Juggling two perspectives
Harvard professors Michael Tushman and Charles O’Reilly III gave life to the concept of an ambidextrous organization in 1996. Their thesis, based on extensive research, was that balancing exploitation and exploration was the key to survival.
Successful exploitation harvested the rewards of existing core strengths. While minimizing change and conflict, this also enhanced productivity and preserved identity. Conversely, a focus on exploitation by other companies took on a more future-orientated stance. Failures were recognized as opportunities for innovation and exploring new concepts and identities. The inherent conflict and uncomfortable changes this courageous path brought, were embraced along with a vision for a new identity. Clearly, organizations that are able to be ambidextrous and effectively balance exploitation and exploration, will be optimized for surviving and thriving in times of change.
In practice, this would translate into intentionally sustaining existing customer and asset bases, while actively pursuing new products, markets and concepts. Professors Tushman and O’Reilly likened this ambidexterity to juggling. For most people, juggling is an impossible art that few aspire to. However, in the context of business it is a survival skill. The juggler’s secret is his appreciation for different perspectives as opposed to multi-tasking. Unfortunately, many already overwhelmed leaders settle for isolating manageable aspects of ambidexterity.
Three Typical Approaches to Ambidexterity
This approach treats exploration and exploitation independently. Imagine a juggler throwing two balls in the air, but each ball remains in its hand of origin. In the context of business, this could be the creation of new units in isolation of the core business, or fragmented research and development initiatives.
Other leaders exercise both exploitation and exploration, but independently and at different times. For a juggler, this would be defined by a sporadic ability to juggle. Statistics show that this pattern is largely crisis-driven, as opposed to a strategic plan.
A successful juggler can juggle different objects from hand to hand, as often and as long as necessary. In business, this represents a collaborative environment which maximizes the combined creativity, innovation, skill and energy of every member of the organization.
So, How Do you Become an Ambidextrous Organization?
Research shows that effective ambidexterity is primarily defined by three key characteristics, namely structure, leadership and culture.
Ambidextrous organizations are structured for an equilibrium of freedom and autonomy, without compromising necessary controls. Excellent financial controls and individual accountability create a safe environment which is conducive to information sharing and creative collaboration. Especially within small, individual groups with well-defined purposes. Teams are unified by the vision and strategy of the organization. The ethos of this structure is one of collective strength and flexibility, where people assets are interchangeable as and when situations require. This has the positive spin-off of expanding individual skill sets and experiences too.
One of the strongest aspects of organizational ambidexterity, is that it allows people the freedom to take the initiative to innovate. When organizations foster a culture in which people are able to explore and express their creativity with openness and enthusiasm, there is less opportunity for destructive fear and defensive aggression. Each participant is governed and guided by the organizations vision and values.
The prevailing mindset in an environment like this, is one of collective strength and security. With a good understanding of their position and function in the organization, people recognize that everyone’s contribution is vital, and feedback becomes a positive tool. Research has also shown that this lends itself to long-term job stability, which ensures a great return on investment on employee training and experience for the company as well.
The essence of ambidextrous organizations’ leadership is an openness to learning and innovation. It is not defined by arrogance and bureaucracy, but rather by an intentional desire to enhance and harness the collective innovation of the team. Mistakes and past failures are used only as a means of learning to make the future better for everyone. This involves risk and a willingness to allow each person a measure of autonomy.
Ambidextrous leadership understands that nobody is perfect and that creative unchartered territory is sometimes paved with failure. The focus is not on elusive perfection, but rather on a 70% success rate. Not surprisingly, this is the hardest aspect of ambidexterity to apply because leadership has traditionally been more rigid. Ironically, this kind of leader’s power lies in his ability to let go of control and to equip others to be more effective and accountable.
Understandably, leadership is the glue that holds the autonomous units together in a constructive way. Known as navigators of the innovation process, these leaders facilitate connection and communication between all units. This essential leadership role can be filled by a person, or a team, according to the needs of the organization. Leaders who are most successful in this role, usually possess a wide range of skills and diverse knowledge of the areas essential to the working of the organization and the nature of their business. Of course, all this is useless without the ability to relate to people and to foster a spirit of unity among all participants.
It goes without saying that focusing on concurrent exploration and exploitation demands effort and requires resources. Remember trying to write with your other hand? It’s awkward and uncomfortable, but with perseverance, it can be done well.
It doesn’t end with simply accomplishing the art of exploration and exploitation. Integration of the lessons and rewards is critical to success. This includes the ability to recognize that some changes may or may not be appropriate to a specific time or situation. Sometimes a creative approach is required to tailor the lessons to your unique business environment.
Sadly, too many organizations only recognize the need to implement ambidexterity when they find themselves in the storm. Already under pressure, the prospect is often overwhelming and they simply take no action at all. Others, only act in response to a crisis. By all accounts, forward-thinking organizations who intentionally implement these principles as a strategy, stand to get the most value from the Ambidextrous model. Corporate Alchemists provide the means tools to help your company develop into an ambidextrous organizations, so that it can compete and thrive in the global economy.