How to Become an Ambidextrous Leader
A few
pages into Lead
and Disrupt: How to Solve the Innovator’s Dilemma (Stanford University Press, 2016), business
professors Charles A. O’Reilly III and Michael L. Tushman present two lists of
companies. At first glance, there doesn’t seem to be too much difference
between them. Each features 27 companies, most with familiar names and long
histories, such as GM, Siemens, and Lego.
The second list includes some dead companies
— such as Circuit City and Bethlehem Steel — and some companies that are
shadows of their former selves, such as RadioShack. But the histories of the companies
on the first list reveal that many of them have experienced their fair share of
hard times, too. For example, the French media conglomerate Vivendi endured a
period of turmoil after a series of aggressive acquisitions in the late 1990s.
Nevertheless, O’Reilly, the Frank E. Buck Professor of Management at Stanford’s
Graduate School of Business, and Tushman, the Paul R. Lawrence MBA Class of 1942 Professor of
Business Administration at Harvard Business School, see a clear difference in
the success of the companies on the two lists. And they peg leadership as its
source.
The companies
on the first list, they contend, “had ambidextrous leaders who
were able and willing to exploit existing assets and capabilities in mature
businesses and, when needed, reconfigure these to develop new strengths.” The
companies on the second list were not so lucky. Their leaders, say the authors,
“were rigid in one way or another — unable or unwilling to sense new
opportunities and to reconfigure the firm’s assets in ways that permitted the
company to continue to survive and prosper.”
Putting
the support for that contention aside, ambidextrous leadership is a beguiling
concept. Maybe RadioShack and Circuit City would still be leading electronics
today if, decades ago, their leaders had asked the question that O’Reilly and
Tushman say all ambidextrous leaders ask: “How can we both exploit existing
assets and capabilities by getting more efficient andprovide for
sufficient exploration so that we are not rendered irrelevant
by changes in markets and technologies?”
As the
book’s subtitle suggests, ambidexterity also might offer a solution to Clayton M. Christensen’s innovator’s
dilemma, as well as to the challenge of
simultaneously addressing the conflicting
dictates of exploitation and exploration posed by Stanford organizational expert James G. March. Perhaps an incumbent
company won’t get caught flat-footed by a new player using a technology that’s
barely created a blip in the marketplace if it’s already trying to figure out
how to put that technology to work. Further, the ambidextrous incumbent might
have an advantaged position with regard to resources. After all, it has a core
business that can fund and staff its efforts, while a new player has to scare
up external financing/bootstrap its way to scale.
The challenge, of course, is transforming the
concept of ambidexterity into an organizational capability. And here, O’Reilly
and Tushman provide some nuts-and-bolts advice. Structurally, they call for: a
clear strategic intent that identifies and embraces both exploitation and
exploration opportunities; the funding and nurturing of new ventures by senior
management; a separation between existing and new businesses; and the vision,
values, and culture that support “a common identity between the
explore-and-exploit units.”
The authors also define leadership principles
that support ambidexterity. Senior leadership teams need to have a shared
strategic aspiration that unites them in the pursuit of exploitation and
exploration opportunities. They need to set a strategic balance between these
inherently conflicting efforts, and then cope with tensions that arise from the
conflict between them without losing that balance. They need to evaluate and
judge exploitation and exploration efforts differently, which will require them
to be inconsistent in their actions across units. Finally, they need to
allocate the dedicated blocks of their time to work on the individual units.
O’Reilly
and Tushman’s practical recommendations are the best reason to readLead and
Disrupt, even though their case for ambidexterity as the Holy Grail of
corporate longevity is not entirely convincing. But if you are trying to patch
the holes that sink corporate ships, ambidexterity seems like a good attribute
to have. When the situation calls for all hands on deck, it’s helpful to have
both left and right hands working.
Theodore Kinni
http://www.strategy-business.com/blog/How-to-Become-an-Ambidextrous-Leader
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