To test this, we undertook a series of regression analyses, which showed that (a) ambidexterity is correlated with performance, (b) organizational context is correlated with ambidexterity, (c) organizational context is correlated with performance and, the critical step, (d) when ambidexterity and organizational context For a full description of the research and statistical analyses, please refer to C.B. Lloyds TSB Bank Plc, based in the United Kingdom, delivered spectacular shareholder returns throughout the 1980s and 1990s, in large part through CEO Brian Pitman’s single-minded focus on return on equity. This group met quarterly to discuss issues, share best practices and collaborate on marketing plans.On a routine visit to the head office in St. Louis, a Canadian plant manager for a large consumer products company heard discussions about plans for a $10 million investment in a new tape manufacturing plant. The correlation between organizational context and ambidexterity across the 41 business units was highly significant (The second hypothesis argued that ambidexterity would mediate the relationship between organizational context and performance.

Faced with impending deregulation, however, Cowes’ country-club culture put the company in a noncompetitive position. In lower-performing companies, front-line employees rated elements of organizational context an average of 1.5 points lower on a 7-point scale than did their top-management counterparts. However, despite the plethora of research output on ambidexterity, very few studies are actually providing insights into what specific behaviors and leadership styles accomplish ambidexterity and how organizational constraints influence ambidextrous leadership. Tushman and C.A. The communication of the message was, in the words of one executive, “doggedly consistent.”At the same time, the company developed what one executive called a “deep desire to adapt.” The seven strategic goals were updated every two or three years, the organization had an informal style of management in which expressing alternative views was encouraged and managers developed a self-critical approach, always looking to improve. The memo explicitly stated that “the stress of billable hours is dehumanizing and verging on an abdication of our professional responsibilities.”Scotch Inc. (not its real name), one of the largest consumer products companies in the world, provides another example of burnout. Scotch had grown quickly during the late 1990s through a strategy of focusing on a small number of core brands and rolling them out quickly on a global basis. In our survey analysis, Oracle employees emphasized goal setting, individual performance appraisal and risk management; Renault employees highlighted capital allocation, recruiting and vision. Sumantra Ghoshal and Chris Bartlett define context as the often invisible set of stimuli and pressures that motivate people to act in a certain way.Ghoshal and Bartlett argue that four sets of attributes —stretch, discipline, support and trust — interact to define an organization’s context. Managing complexity well can create three major benefits: Higher returns. The module worked so well that operations managers in several other countries subsequently adopted it.These four attributes — which collectively describe an ambidextrous employee — have several important commonalities. Exploration refers to innovation, whereas exploitation addresses cost efficiency. The first argued that a supportive organizational context — characterized by a combination of performance management and social support — would be associated with a higher level of ambidexterity. Eventually, performance suffers as exhausted and disenchanted employees have neither the capacity nor the incentive to execute or innovate. The emphasis on performance management had led to solid growth, but executives were concerned about where the next phase of growth would come from.

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