Combining competence building and leveraging: Managing paradoxes in ambidextrous organizations

The competitive arena in business environments has changed in many ways. The globalization of markets, rapid technological change, shortening of product life cycles, and the increasing aggressiveness of competitors require firms to respond flexibly and rapidly (Grant, 1996; Volberda, 1996). Not just fast-moving, high-tech industries have been facing these changes; even industries that were supposed to be stable are heating up (D’Aveni, 1994). As competition intensifies and the pace of change accelerates, firms are increasingly confronted with a tension between exploiting existing competences and exploring new ones (Floyd & Lane, 2000; Levinthal & March, 1993; March, 1991). Firms seek to adapt to environmental changes, explore new ideas or processes, and develop new products and services for emerging markets. In addition, they need stability to leverage current competences and exploit existing products and services (Benner & Tushman, 2003; Sanchez & Heene, 1996).