– The purpose of this paper is to report on lab experiments conducted to determine what impact managerial top-down knowledge transfer has on a middle manager’s individual ambidexterity and decision performance.
– The authors designed an experimental approach using a business simulator to test the hypotheses with middle managers. The methodological approach provides the authors with a framework to enhance the middle manager’s understanding of how to attain superior short-term financial results by exploiting current resources, in addition to mastering new strategies to avoid a potential business bankruptcy.
– The results suggest that top-down managerial knowledge inflow benefits middle manager strategic decision making, as well as his/her short- and long-term performance. Nonetheless, the best short-term results were achieved by those middle managers that mastered both exploitation and exploration activities simultaneously.
– The contribution of this paper is to identify and test a control mechanism called top-down inflows that enhance middle manager’s ability to exploit current resources to increase financial performance, and exploring new strategies to avoid a business bankruptcy.
