Examining ambidexterity strategies: organic development vs. mergers and acquisitions - a comparative analysis of organisational growth approaches

Abstract

Ambidexterity reflects the organisational capability to harmonize exploitation and exploration activities seamlessly. Some organisations achieve this state by using internal mechanisms to further explore, others are keener on pursuing external options, like M&A. While the academic research literature delving into the concept, creation and examples of organisational ambidexterity is abundant, there is a literature gap in the extrusion of factors that compare and provide a better positioning towards internal or external ambidexterity. This study, through the main research question: “What are the supporting and disruptive factors between internal (organisational) and external (M&A) ambidexterity in organisations?”aims to investigate which factors contribute to the birth and further development of exploration through internal means and which would indicate a better organisational fit through ambidexterity by external means. To answer this pressing question, we opted for qualitative research and conducted several semi-structured interviews with high level managers and industry professionals from companies that either innovate internally, use M&A as the primary exploration utility, or do both. Once we had conducted the interviews, we transcribed and coded them according to Mayring's theory of qualitative analysis. We discovered multiple factors that could lead to the birth of either the internal or external type of ambidexterity, which we then condensed in five overarching aspects comparing them with internal and external ambidexterity creation. Because of the small concentration of literature taking into consideration this comparison, it is difficult for organisations that are in search of guiding to know which path is better suited to them. Organisations that have a culture of experimentation, that can accept the risks of their experiments, know their identity and have leaders that through their faith in them push them to be better and more innovative, and moreover provide them with the right organisational structure and resources are the ones where the growth of internal ambidexterity is the right choice. If M&A is the answer to one’s ambidexterity quest, then the organisations should be flexible, with a welcoming, integrating culture and leaders that are set on collaboration outside of their companies’ boundaries.