Balancing Exploitation and Exploration for Strategic Flexibility in IT-enabled Business Model Transformation of Traditional Enterprises: An Ambidextrous Perspective

There is growing recognition that information technology (IT)-enabled business model transformation is a distinctive source of sustainable competitive success for traditional enterprises. In this context, strategic flexibility is an important catalyst for IT-enabled business model transformation. During the process of strategic flexibility, a key challenge for traditional enterprises is to balance exploitation of current resources and exploration of future resources. In this article, we examine this balance through an ambidextrous perspective in order to understand how it is achieved in the development of strategic flexibility. A case study is conducted on a large-scale well-known clothing manufacturing company in China attaining success in IT-enabled business model transformation. In our study, a process model is proposed to depict an incremental and iterative development to achieve exploitative and explorative balance, which contains four stages based on business model life cycle. The study’s theoretical and practical contributions and future research directions are discussed.