Creating competitive advantages: Interactions between ambidextrous diversification strategy and contextual factors from a dynamic capability perspective

Hsing Er Lin, I. Chieh Hsu, Audrey Wenhsin Hsu, Hsi Mei Chung

Research output: Contribution to journalArticle

Abstract

Is competitive advantage sustainable? We argue that firms can create temporary and consecutive competitive advantages by pursuing an ambidextrous strategy. This depends on the capability of firms to achieve simultaneous related and unrelated diversification during periods of turbulence. However, the manner by which firms exploit and develop resources and capabilities remain a major gap in the empirical literature on the diversification–competitive outcomes relationship. Adopting a dynamic capability perspective, we examine why and how the simultaneous pursuit of ambidextrous diversification creates temporary and consecutive competitive advantages. Employing longitudinal data for 2010–2015 to test our hypotheses, we find that an ambidextrous strategy has a curvilinear influence on advantages creation in terms of efficiency and effectiveness. These effects vary by interactions with R&D investments and firm-specific uncertainty. Finally, the impact of the three-way interactions among firm-specific uncertainty, ambidextrous diversification, and R&D investments on efficiency takes the form of a U-shaped curve.

Original languageEnglish
Article number119952
JournalTechnological Forecasting and Social Change
Volume154
DOIs
Publication statusPublished - 2020 May

All Science Journal Classification (ASJC) codes

  • Business and International Management
  • Applied Psychology
  • Management of Technology and Innovation

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