Research summary: This study suggests that strategy and organizational scholars seeking to analyze the impact of exploitation on exploration would benefit by moving away from the generally assumed unitary perspective on exploitation. Specifically, we propose a multifaceted perspective on exploitation by theoretically and empirically distinguishing between repetitive exploitation versus incremental exploitation. We argue that repetitive exploitation can impede exploration and delay firms' responses to environmental changes, while incremental exploitation can impel exploration and accelerate firms' responses to environmental changes. We test our arguments using extensive longitudinal data from the hard disk drive (HDD) industry, and our supportive empirical findings highlight the relevance of our distinction between the two types of exploitation and their very different effects on exploration. Managerial summary: This study offers a solution to the puzzle of why many believe firms cannot excel at advancing existing practices and developing new initiatives, typically described as the trade‐off between exploitation and exploration. We introduce the distinction between repetitive and incremental exploitation and show that only the former type of innovation generates rigidity toward exploration, whereas the latter actually promotes exploration. More specifically, our evidence from the hard disk drive industry shows that those firms emphasizing incremental innovation (as opposed to repetition of their existing practices) were most likely to remain explorative over time, whereas firms emphasizing more repetitive innovation proved less open to changes. We discuss the implications of our findings as suggesting that firms seeking to optimize their innovativeness over the long term should strive to remain active in incrementally innovating their existing practices. Copyright © 2015 John Wiley & Sons, Ltd.

This study investigates the longevity implication of exploration. An analysis of 1980-1999 data from the hard disk drive industry suggests that exploitation to the exclusion of exploration generally undermines firms’ long-term viability. However, this general pattern does not guarantee the long-term benefit of each individual exploration attempt. Depending on how long an exploration process overlaps an exploitation process, the longevity implication of exploration varies: If the temporal overlap is too long or too short, a firm tends to lose its longevity; however, if the temporal overlap remains at a moderate level, a firm can extend its longevity.

Purpose – The purpose of this paper is to investigate the longevity implications of exploitation and exploration. It examines the main effect of exploitation, the main effect of exploration, and the interaction effect of exploitation and exploration on organizational longevity. Design/methodology/approach – This study employs Cox Proportional Hazard Model in analyzing 20-year data from the hard disk drive industry. Findings – Exploitation, independent of exploration, has a positive impact on organizational longevity. Exploration, independent of exploitation, has a curvilinear impact on organizational longevity. Jointly, exploitation weakens the curvilinear relationship between exploration and organizational longevity. Research limitations/implications – This study challenges the dualistic view that exploitation is for “current viability” and exploration is for “future viability.” It suggests that firms need to actively engage in (instead of compromise) both exploitation and exploration in order to prolong their lifespan despite the counter force triggered by the negative dynamics between exploitation and exploration. Practical implications – In order to prolong organizational longevity, firms need to fully engage in (but not compromise) their existing product-market domains, actively explore (but not over-explore) their new product-market domain, and to embrace (but not avoid) the tension between exploitation and exploration. Originality/value – This study is one of the few that systematically and empirically examined the longevity implications of exploitation and exploration. It adds specificity and precision to the understanding of how exploitation and exploration, independently and jointly, affect organizational longevity.

When to enter the first learning alliance has strategic implications for firms' long term success. However, research on timing of the first learning alliance is rare. As one of the few empirical studies on this issue, this paper aims to fill the gap by asking what the implications are when firms launch their first learning alliance at different points of time. Empirical results support the central proposition that if firms enter the first learning alliance too early or too late, they tend to rush into a second learning alliance in a short period of time. In the long run, they will lose the ability to innovate. Overall, this study has fundamental implications for organizational learning in particular and theory building in general.