Your Strategy Needs a Strategy
Ambidexterity is the ability to apply multiple approaches to strategy either concurrently or successively, since many firms operate in more than one strategic environment at once. Ambidexterity is not another color on the strategy palette; it is a technique for using the five approaches to strategy in combination with one another. The four approaches to ambidexterity—separation, switching, self-organization, and external ecosystems—depend on the degree of diversity and dynamism of the environment.
Most large businesses operate in multiple environments that change quickly over time—spanning many increasingly diverse geographies and product categories—and that are supported by a wide range of enabling functions. This diversity requires firms to be ambidextrous, because no single approach to strategy is applicable to a large firm in its entirety and over time.
The right approach to ambidexterity depends on how many different environments the firm faces (diversity) and how often those environments change (dynamism). A separation approach means that different approaches to strategy are managed top-down and are run independently from one another in different divisions or geographies. Firms applying a switching approach manage a common pool of resources that switch among the five approaches to strategy. Self-organization means that each unit chooses the best approach to strategy. In an ecosystem approach, firms source different approaches to strategy externally through players that specialize in the needed approach.
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