Managerial Social Networks and Ambidexterity of SMEs: The Moderating Role of a Proactive Commitment to Innovation

• Date: 01 December 2015
• Published date: 01 December 2015
• DOI: http://doi.org/10.1002/hrm.21703

Human Resource Management, December 2015, Vol. 54, No. S1. Pp. S201–S221

© 2015 Wiley Periodicals, Inc.

Published online in Wiley Online Library (wileyonlinelibrary.com).

DOI:10.1002/hrm.21703

Correction added on June 5, 2015, after first online publication: In Figure 1, the key listed the solid line as corresponding to low

levels of managerial proactiveness and the dashed line as corresponding to high levels of managerial proactiveness, and this was

corrected to the reverse.

Correspondence to: Ciaran Heavey, University College Dublin, Lochlann Quinn School of Business, Belfield, Dublin 4,

Ireland, Phone: +353-1-7164742, E-mail: Ciaran.Heavey@ucd.ie

MANAGERIAL SOCIAL NETWORKS

AND AMBIDEXTERITY OF SMES:

THE MODERATING ROLE

OF A PROACTIVE COMMITMENT

TOINNOVATION

CIARAN HEAVEY, ZEKI SIMSEK, AND BRIAN CURTISFOX

Organizational research suggests that ambidexterity is attainable if top manag-

ers cultivate collective behavioral routines that enable them to synthesize large

amounts of information and decision alternatives, and manage confl ict and ambi-

guity. However, the type of information and knowledge sources that enable top

managers to meet the knowledge demands of ambidexterity remains poorly

understood. Toward that end, we argue that the extensiveness of top managers’

social networks inside and outside the fi rm, on an integrative basis, can offer

the dual knowledge benefi ts conducive to ambidexterity. Because ambidexterity

entails the fi rm’s departure from existing products, technologies, and practices, we

further argue that the contribution of extensive networks to ambidexterity is con-

ditional upon the collective volition of top managers to parlay extensive network

opportunities into innovative pursuits. From a study of CEOs and top manage-

ment teams in SMEs operating in technology-based industries, we fi nd support

for both a network extensiveness effect and the moderating role of a proactive

commitment to innovation in shaping this effect. ©2015 Wiley Periodicals, Inc.

Keywords: ambidexterity, managerial social networks, managerial proactiveness

Organizational scholars have long sought

to describe and explain how firms dex-

terously cultivate strategic orientations

for exploitation and exploration, other-

wise known as an ambidextrous orien-

tation (Birkinshaw & Gupta, 2013; Kostopoulos

& Bozionelos, 2011; Turner, Swart, & Maylor,

2013; C. L. Wang & Rafiq, 2014). While the major

focus of scholarly attention has been on charting

the structural, contextual, and temporal founda-

tions of ambidexterity, it is also recognized that

top managers play a central role, particularly in

assessing and integrating the knowledge require-

ments for exploitation and exploration. Indeed,

because firms exhibit inertial and path-dependent

tendencies in their knowledge processes toward

the pursuit of either exploitation or exploration

(e.g., Rosenbloom, 2000; Tripsas & Gavetti, 2000),

S202 HUMAN RESOURCE MANAGEMENT, DECEMBER 2015

Human Resource Management DOI: 10.1002/hrm

On an integrative

basis, the

extensiveness of top

managers’ networks

is likely to provide

the dual knowledge

foundations

necessary for

engendering

ambidexterity.

extent to which top managers are responsive in

sensing opportunities for exploitation and explo-

ration from their ties inside and outside the firm

(Patel, Messersmith, & Lepak, 2013). At the same

time, fortune favors prepared top managers who

are able to match those opportunities with appro-

priate and timely commitments (W. M. Cohen &

Levinthal, 1989). Thus, the contribution of mana-

gerial networks to ambidexterity will likely depend

on the extent to which top management teams

demonstrate “proactive commitment to innova-

tion,” or the ability to match proactiveness with

the requisite commitments needed to sense and

seize opportunities.

We test these arguments in a study of CEOs

and their top management teams from a diverse

sample of small- to medium-sized firms in

technology-based industries. We contribute to

research on the managerial antecedents of ambi-

dexterity by demonstrating how the extensiveness

of managerial networks helps to meet the dual

knowledge requirements of ambidexterity. We

then add nuance to this account by demonstrat-

ing that the path to ambidexterity from networks

is not straightforward, and is complemented by a

proactive commitment to innovation for greater

ambidexterity.

Theory and Hypotheses

Although exploitation and exploration are both

viewed as essential to the long-term survival and

prosperity of firms (Junni, Sarala, Taras, & Tarba,

2013), their combined pursuit demands complex

knowledge inputs and routines from the top man-

agement team (Lavie, Stettner, & Tushman, 2010).

Whereas exploitation entails the use and develop-

ment of existing knowledge, exploration involves

the development of new knowledge (Levinthal &

March, 1993). While top managers use a variety of

knowledge sources, they are particularly reliant on

their network of ties inside and outside the firm

(Aguilar, 1967; Daft, Sormunen, & Parks, 1988;

McDonald, Khanna, & Westphal, 2008; McDonald

& Westphal, 2003). For example, during our data

gathering phase, we spoke to the CEO of a tech-

nology manufacturing company who reported

that he spends several days a month in the fac-

tory, building ties with employees, which helped

him develop more tacit knowledge of operations

and deeper insights into potential applications of

the firm’s competences. In a complementary fash-

ion, his close ties to customers and governmental

agencies permitted insight into the performance

of existing technologies, which provided him

with ideas for refining existing designs and creat-

ing new designs in response to emerging customer

needs. In this way, top managers’ social networks

disrupting the self-reinforcing momentum toward

a single knowledge orientation is one of the more

important roles of top managers in engendering

ambidexterity.

Based on the recent insight that social net-

works help to position top managers and firms at

the crossroads of information sources for exploi-

tation and exploration (Cao, Simsek, & Zhang,

2010; Kang, Snell, & Swart, 2012; Simsek, 2009),

we propose that a managerial social capital per-

spective can enrich understanding of how top

managers access and mobilize the dual knowl-

edge requirements of ambidexterity. In particu-

lar, we argue that the extensiveness of managerial

networks—defined as the strength of their ties

with actors inside and outside the firm—provide

knowledge benefits conducive to ambidexter-

ity (e.g., Cao et al., 2010; Simsek, 2009). Within

the organization, ties with employees and man-

agers in various functional units and divisions

such as marketing, engineering, and

research and development (R&D)

serve as a communication and influ-

ence channel that help top manag-

ers recognize, access, and interpret

firm-specific knowledge. Outside

the firm, top managers’ ties with

customers, suppliers, competi-

tors, financial agencies, industrial

authorities, and government bodies

serve as conduits for knowledge that

can shape managerial views of the

environment and expand the range

of ideas, information, and decision

alternatives available for consider-

ation (e.g., Cao et al., 2010). On an

integrative basis, the extensiveness

of top managers’ networks is thus

likely to provide the dual knowledge

foundations necessary for engender-

ing ambidexterity.

However, while network extensiveness can

explain how top man agers gain access to knowl-

edge, it does not adequately account for the extent

to which, and under what conditions, top man-

agers mobilize and utilize knowledge afforded by

an extensive network to meet the dual require-

ments of ambidexterity. Because opportunities for

exploitation and exploration are fleeting and call

for the timely dedication of firm resources, the

contribution of extensive networks to ambidexter-

ity may ultimately be conditional upon the col-

lective will or volition of top managers to parlay

network knowledge and opportunities into ambi-

dextrous pursuits. We argue that this managerial

will is rooted in two core behavioral proclivities.

First, managerial proactiveness likely shapes the