This paper aimed to specify an organizational form suited to distributed ambidexterity. We showed that ambidexterity poses paradoxes in each of the four basic organizational subsystems suggested by Parsons—values, norms, authority structure, and capabilities. We argued that these paradoxes could be resolved by synthesis if action is based on what Weber called value-rationality. We pointed to ways in which, notwithstanding Weber’s own skepticism, a robust organization could be built around value-rationality through the deployment of managerial techniques—developed since Weber’s time—that help institutionalize value-rationality as the appropriate form of action.
The core of the paper showed how such a value-rational organization could support DA by allowing the organization to reach a synthesis of each of the key organizational paradoxes of ambidexterity. First, the paradox in values subsystem lies in DA’s need for values that simultaneously celebrate both creativity and efficiency. When values that continuously orient members to the organization’s ultimate purposes are institutionalized as an “ethic of contribution” in the organization’s culture, strategy content, and strategy process, the result is a sense of shared purpose that encourages all members to see these ultimate values as superordinate, and to embrace the challenge of synthesizing the subordinate goals of creativity and efficiency.
Second, in the norms subsystem, DA paradoxically requires simultaneously organic and mechanistic norms of interaction and communication. We argued that formalized procedures can be designed under norms of substantive rationality through various forms of “interactive process management and design,” and that under these conditions, the result is a set of norms that are widely experienced as enabling in the pursuit of the common goals, thus synthesizing the virtues of organic and mechanistic systems to support DA.
Third, in the authority subsystem, DA requires a paradoxical combination of local autonomy and centralized control. We argued that the value-rational organization could ensure that authority—whether dispersed or centralized—was based on a widely-acknowledged ability to contribute to the organization’s shared purposes, and that the resulting pattern of “participative contingent centralization” would enable DA.
Finally, in the capabilities subsystem, DA requires a paradoxical combination of deep and broad individual skills. We argued that value-rational organizations could aim to recruit people with this unusual combination, and leverage their members’ desire to contribute to the organization’s shared purposes to steer individuals’ skill formation paths towards the development a T-shaped combination of breadth and depth that supports the DA effort.
We offered illustrations of each of these causal paths from prior literature and from Kaiser Permanente. Clearly however, our arguments need empirical testing: we see that as an important next step. Our theory suggests two basic models to be tested: first, controlling for various exogenous factors, distributed ambidexterity should be more likely to be achieved where organizations more closely resemble the value-rational form; and second, where organizations attempt to build distributed ambidexterity, and conditional on an external context that rewards the results of ambidexterity, business performance should be better where this strategy is associated with the adoption of the value-rational organizational form.
As concerns the boundary conditions that limit the applicability of the value-rational form, the key issue is the balance between the performance benefits and the “organizational overhead” costs of this form relative to alternative forms. We anticipate that its implementation would prove less cost-effective in organizations pursuing one-dimensional strategies where alternative forms would offer greater net benefits. The causality might, of course work in reverse too: if an organization can implement a value-rational form, this might incline it to adopt a strategy that leverages DA.
In a more speculative vein, future research might also consider whether the value-rational form, rather than being just one organization design option among several, represents instead an evolutionary advance beyond those others. In this perspective, if a social innovation process has yielded management techniques that allow organizations to institutionalize value-rationality, perhaps this organizational form might become an efficient solution to the challenges facing a broader range of organizations, including ones whose primary strategic goal is more narrowly focused on either exploitation or exploration.
Our account of the value-rational organizational form needs to be expanded by closer consideration of it overhead costs and intrinsic risks. Without a clearer understanding of these downsides, our model risks being treated as a utopian panacea. It is clear even from the account that we have offered that the value-rational form depends on reliable mechanisms for establishing and updating reputations, but we know that these mechanisms are vulnerable to opportunistic manipulation. The high level of participation in value-rational organizations requires considerable meeting time, but such meetings are costly and burdensome. The value-rational form requires openness to diversity, difference, and disagreement, but it offers little assurance these will not explode the collectivity or seal the organization off from the outside world as a closed sect.
Our theorizing is also limited in that we have not addressed the individual cognition, motivation, emotion, or behaviors implicit in our causal model. An important next step in the line of research we have proposed would be to develop a multi-level model that allows us to see how the value-rational organizational form shapes individual behaviors, and then how these individual behaviors aggregate to generate ambidextrous outcomes. Andriopoulos and Lewis (2009) nested-levels approach seems like a fruitful path in that endeavor. Moreover, in building this multi-level theory, it would be useful to differentiate more finely among the various ways in which the paradoxes of exploitation and exploration can be synthesized. Smith and Lewis (2011). For example, we could differentiate three types of organizational tensions—dilemma, paradox, and dialectic: dilemma takes us back to a pure trade-off relationship, but the psychological experience of a DA synthesis will surely differ depending on whether DA takes the form of a persistent paradox lived in ongoing tension or a dialectical integration sufficient unto itself.
More generally, our argument has functioned at a fairly high level of abstraction, and the effective achievement of DA likely depends on more concrete features of the organization, such as specific organizational structures or leadership styles. Future research should explore the ways in which value-rationality interacts with some of these more concrete features to enable ambidexterity.