The moderating effect of contextual ambidexterity on the relationship between organisational resilience and firm performance in the context of disruptive events

Abstract

Globally, there is an increase in disruptive events such as natural disasters and pandemic diseases (Mithani, 2020), reflecting the increasing complexity of human development. There is a need to understand the functioning of firms during these events. While contextual ambidexterity and organisational resilience are established research areas, there is limited inquiry on the relationship between these constructs to maintain firm performance in the adaptation to these disruptive events, motivating the need for this study. The aim of the study was a quantitative evaluation of the moderating role of contextual ambidexterity on the relationship between organisational resilience and firm performance in coping with disruptive events. The study context was the response of firms to the COVID-19 pandemic as an instance of a disruptive event. The results revealed that within the study context, organisational resilience and contextual ambidexterity had weak positive relationships with firm performance. It was shown that neither contextual ambidexterity, exploitation or exploration had a moderating effect on the relationship between organisational resilience and firm performance in the context of disruptive events. This study illustrated the close relationship between contextual ambidexterity and organisational resilience as organisational capabilities during disruptive events. Rather than a moderating variable, contextual ambidexterity was postulated as an antecedent for organisational resilience. This study highlighted the critical role of the business context in assessing how firms respond to these events. It was postulated that firms could have benefitted from a more focussed approach on either exploitation or exploration, suggesting that an ambidextrous response is not always appropriate. This study contributes to the literature on disruptive events by understanding the capabilities required to effectively respond to these events.