Exploring social capital architectures enabling emergence of business unit ambidexterity

Abstract

Attaining business unit ambidextrous capability is a desirable achievement. It is even more desirable now than ever before, owing to the increasingly complex environments with which firms must contend. The literature identified firm adaptability as a key strategic capability. Failure to adapt could lead to obsolescence. Ambidexterity has mostly been regarded as a firm-level capability that is normally developed from ambidextrous human capital. An alternative path was theorised, postulating that specialised human capital could also be a source of ambidextrous capability through social capital mechanisms. The literature, however, has identified the lack of research at the lower levels of the firm. This research, therefore, aims to explore how specialist human capital could be a source of business unit ambidexterity through social capital mechanisms. This knowledge will enable managers to have a good grasp of the mechanisms and design work systems that could build this capability. This study followed a qualitative case study design approach to get an in-depth understanding of the social mechanisms that enable the development of ambidexterity within the case context. Twelve interviews with specialist managers from the engineering and forestry business unit of the case firm were carried out. The managers represented the junior, middle and senior management levels. The interview transcripts were analysed using the directed content analysis with new codes inductively coded during the transcription analysis process. The study findings concluded that business unit ambidexterity is a complex construct to operationalise. The study identified the key processes that complemented each other and facilitated the development of business unit ambidextrous capabilities. A model that integrates the key processes emerged from the study. The model offers mechanisms at three firm levels that complement each other: individual human capital level, business unit social capital, firm-level organisational capital, and human resources practices that cut across all levels. A strong cooperative social climate underpinned by trust creates a supportive environment that facilitates knowledge sharing and exchange. The model integrates the key elements identified in the study as crucial to the development of business unit ambidexterity and managers could use it as a guideline when they are building business unit ambidextrous capabilities based on specialist human capital.