Role of ambidexterity and learning capability in firm performance. A study of e-commerce industry in India
| Date | 12 November 2018 |
| DOI | https://doi.org/10.1108/VJIKMS-10-2017-0073 |
| Published date | 12 November 2018 |
| Pages | 517-536 |
| Author | Sanjay Dhir,Swati Dhir |
| Subject Matter | Information & knowledge management,Knowledge management,Knowledge management systems |
Role of ambidexterity and
learning capability in firm
performance
A study of e-commerce industry in India
Sanjay Dhir
Department of Management Studies, Indian Institute of Technology Delhi,
New Delhi, India, and
Swati Dhir
International Management Institute, New Delhi, India
Abstract
Purpose –This study aims to comprehend the ambidexterity and organizational learning capability
constructin the Indian E-commerce industry context.
Design/methodology/approach –The survey method was adopted for this study. A survey was
circulatedamong the personnel working in E-commerce companies in India.The focus was on people working
in managerialpositions and had at least three years of experiencein the same industry.
Findings –This paper investigates the link between two dimensions of ambidexterity, i.e., exploration,
exploitation and learningcapability in firm performance. The paper also establishes the moderating effect of
the learningcapability on the two dimensions of ambidexterity and firm’s performance.
Research/limitations/implications –Our focus was to cover most of the E-commerce companies,yet
to generalize the research the analysis needs to be conducted with even more E-commerce companies.
Although we took extraordinarycare to gather data from multiple resources and discarded the data that was
incompleteor was from lower level employees yet, we need a larger sample to establish the causal claim of our
model.
Practical/implications –We reason that learning capabilityof a firm impacts the two dimensions and
firms shouldfocus both on external and internal knowledgeto benefit from the ambidexterity efforts.
Social/implications –Learning capability influences a firm’s performance and has managerial
implications. The analysis’resultson the India based ecommerce companiesdiffers from prior research done
in more developedcountries and other industries.
Originality/value –No prior research has been done from this perspectivein the Indian context, and thus
our work opens up new avenues for researchers to look at.Keywords Ambidexterity, Firm performance,
Learningcapability
Keywords Ambidexterity, Firm Performance, Learning Capability
Paper type Research paper
1. Introduction
Organizational ambidexterity has acquired a central spot in organizational literature. The
firm’s ability to employ strategies of exploration (look for new opportunities) as well as
exploitation (using existing competencies) is known as organizational ambidexterity
(Tushman and O’Reilly, 1996;He and Wong, 2004;Lubatkin et al., 2006). Ambidexterity
leads to better firm performance. However, there is a critical uncertainty with respect to the
nature of the ambidexterityconstruct (Cao et al., 2009).
Study of
e-commerce
industry in
India
517
Received2 November 2017
Revised13 March 2018
25June 2018
28August 2018
Accepted30 September 2018
VINEJournal of Information and
KnowledgeManagement Systems
Vol.48 No. 4, 2018
pp. 517-536
© Emerald Publishing Limited
2059-5891
DOI 10.1108/VJIKMS-10-2017-0073
The current issue and full text archive of this journal is available on Emerald Insight at:
www.emeraldinsight.com/2059-5891.htm
The two concepts of exploitation and exploration put conflicting demands of
resourcesonanorganization(
Dai et al., 2017;March, 1991). In this context, there is a
tradeoff between the two, and ambidexterity involves managing a middle ground
(Smith and Tushman, 2005;Kabongo and Boiral, 2017). An alternative view has
emerged that the two activities are independent of each other so that organizations can
simultaneously maintain high levels of both (Gupta et al., 2006). Thus, ambidexterity is
explained as a firm’s ability to pursue exploitation and exploration together and not as
a balancing act between the two (Wu and Wu, 2016;Beckman, 2006;Lubatkin, et al.,
2006).
Thus, broadly, the research agrees that ambidexterity is the current application of
exploration and exploitation,but there is a lack of consensus on how the two are matched or
when it comes to the combined effect (Bandeira-de-Mello et al., 2016;Cao, Gedajlovic and
Zhang, 2009). This difference with respect to the fundamental build has prompted various
strategies to operationalize the ambidexterity form, which makes it very hard to contrast
studies and to build a core concept(He and Wong, 2004;Lubatkin et al.,2006). Owing to this
conceptual ambiguity, it becomes unclear to managers regarding how to leverage and
manage explorationand exploitation activities.
In this paper, we have investigated the linkage between ambidexterity, organizational
learning capability and firm performance and established the moderating effect of the
learning capability on the two dimensions of ambidexterity and firm’s performance on
the one hand. We also attempt to provide clarity to the conceptual ambiguity for future
theorization, implementation of results and implications for managers on the other hand.
The Indian way of doing business has been transformed with the advent of the e-
commerce industry in India. In the last four years, the B2C segment of the e-commerce
has grown significantly leading to the creation of multiple unicorns (CII and Deloitte,
2016). The rapid adoption of digital technology will lead to a rise of investors and online
companies from the Indian subcontinent (CII and Deloitte, 2016;Khanra and Dhir, 2017).
The homegrown startups have shown tremendous growth, and international players like
Amazon and Alibaba have increased the competition (ASSOCHAM and Deloitte, 2015).
E-tailers are providing innovative services/offerings to differentiate themselves –30-day
replacement warranty, 1-day delivery, cashback offers, mobile wallets, free trials, cash on
delivery and 3D technology –to try and imitate the brick and mortar experience.
Furthermore, the Indian consumers are armed with smartphones and have turned it into
an online shopper’s paradise, with the retail forecasted to grow at an 11 per cent CAGR
BY 2020 (ASSOCHAM and Deloitte, 2015). E-commerce has become a driving force
behind companies, creating a new customer base in areas that were unreachable even
though it accounts for less than 2 per cent of the total spending on retail (ASSOCHAM
and Deloitte, 2015).
2. Literature review
According to March (1991), exploitation is a firm’s capacity to use existing resources,
whereas exploration is a firm’s ability to investigate new opportunities. Both the activities
are crucial for a company to maintain the competitive advantage. As the two activities are
critically linked to each other,researchers have started studying ambidexterity as a pursuit
of both (Tushman and O’Reilly, 1996;Lubatkinet al.,2006). Following the abovementioned
argument in our literature review, we note that the concept of ambidexterity is accepted as
one of the key ability for organizations’sustainable competitive advantage and is gaining
importance in academic writing and research(O’Reilly and Tushman, 2008). To understand
the process of ambidexterity, there are many studies from different disciplines in the
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