Exploitation and exploration in the transition to electric vehicles: predictors of the ambidextrous design choice - an analysis of the German automotive supply industry

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Abstract:

After 100 years of relative stability, the automotive industry will undergo a discontinuous and long-term transformation due to the transition to electric vehicles. In addition to the continuous improvement of traditional business models and existing technologies (exploitation), innovative business models and new technologies must be developed and adapted (exploration) simultaneously. But automotive companies are reluctant to pursue both objectives of exploitation and exploration. This, because both objectives require different standards of leadership, corporate governance, corporate culture, organizational architecture and other relevant factors. Thus, opposite management logics are necessary simultaneously. Hence, for a successful transition to electric vehicles, a two-handed approach of exploitation and exploration - so-called ambidexterity - is essential.

Although ambidexterity literature represent useful propositions and theoretical insights, how to achieve exploitation and exploration sequentially or simultaneously, less is known about potential predictors of the ambidextrous design choice. To fill this research gap, we analysed potential predictors of the ambidextrous design choice of the German automotive supply industry in the transition to electric vehicles. Against this background we identified organization size, main strategy orientation, perceived environmental dynamism, perceived competitive intensity, pace of technology change, expected complexity of different ambidextrous designs, impact of stakeholders and shareholders as well as expected ambidexterity costs (coordination costs, integration costs) as potential predictors of the ambi-dextrous design choice. Our analysis using a multinomial logit model reveals that organization size, perceived environmental dynamism, perceived competitive intensity, pace of technology change, expected complexity of different ambidextrous designs and expected ambidexterity costs (coordination costs, integration costs), but not the main strategy orientation within business units as well as the impact of stakeholders and shareholders are appropriate predictors of the ambidextrous design choice of German automotive suppliers.

The analysis and its results will be summarized in the conference paper. Following that, further investigation of potential predictors of the ambidextrous design choice as well as possible performance effects will be conducted.