Ambidexterity in Networks: The Effect of Pooling Knowledge From Different Network Structures

Abstract

Firms within a network may interact in two nearly opposite structures: structural holes and network closures. We propose that these two network structures align with different search activities. Structural holes relate to exploratory knowledge search, while closures favor exploitative knowledge search. We posit that ambidexterity between these search activities through different network structures allows firms to improve their innovativeness and performance. We test our hypothesis with a sample of 205 biopharmaceutical firms within a network of licenses agreements. Our results support the ambidexterity hypothesis in different network structures. Implications derived from our study shed light on the network designs to promote firm innovativeness.

Keywords: ambidexterity, networks, exploration, exploitation, biopharmaceutical industry, innovation

JEL Classification: O31, D21, D23