Exploration And Exploitation Essay

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The impact of exploration-exploitation is unpredictable and there is no general rule how to trade-off between these two learning in dynamic environments (Laureiro-Martínez, Brusoni, & Zollo, 2009). It is difficult to integrate both exploration and exploitation simultaneously to improve efficiency in short terms and innovation in long-term as different firm has a different way of thinking and routines for exploration compared to those needed for exploitation (Gupta et al., 2006). Understanding how both knowledge exploration and exploitation can be implemented is crucial. Pursuing both learning is depending on how these tasks are considered either as competing or complementary source for (Gupta, Smith, & Shalley, 2006) value creation that lead to firm performance. As such, the result of pursuing both explorative and exploitative learning towards firm performance is different. Whether it is in terms of its individual effect (Isobe, Makino, & Montgomery, 2004; Yu & Yang, 2011), interaction of both learning (Z.-L. He & Wong, 2004; Zhan & Chen, 2010), imbalance (Z.-L. He & Wong, 2004; Zhan & Chen, 2010) or balance effect (Z.-L. He & Wong, 2004; Lavie & Rosenkopf, 2006; J. Lee & Bae, 2012). In many researches, the focus of a domain can be single or multiple domains. A domain refers to the field of action or thought or region which have particular characteristic (http://dictionary.reference.com). According to (Y. Li, Vanhaverbeke, & Schoenmakers, 2008) domain can be categorized in terms of supply, demand and geographic domain. The authors propose domain function should clearly be identified to provide meaningful finding. Besides that, interaction of exploration and exploitation can be conceptualized either in multiple domai... ... middle of paper ... ...to balance exploration and exploitation: specialization and ambidexterity. However, this can be done in a broader system such as both learning are implemented in two firms instead of an individual firm. One firm may specialize in exploration, and the other specializes in exploitation by controlling the mutual complement resources to avoid waste of resources, to search continuous need for exploration and exploitation, and to obtain adequate compensation for their effort through low co-specialization. However, both exploration and exploitation may be merged through routine task to become more creative; maintain their individual culture and structure together, change employee job from routine to non-routine tasks. Thus, the role of ambiguity and role of conflict will weaken the role of specialization and this create disadvantage to firm (Hjelmgren & Dubois 2013).

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