California Management Review

Abstract

Incumbent firms struggle to renew themselves. Structural ambidexterity balances the exploitation of existing business with the exploration of new opportunities. But these inconsistent strategic agendas generate intense emotional challenges: Senior team frustration over conflicting priorities, board-driven pressures, hostile inter-unit emotions between exploitative and exploratory units, and precarious dynamics within exploratory teams. These emotional challenges undermine renewal efforts and are an underappreciated cause of organizational decline. Senior teams can address them by fostering emotional engagement with the future, expanding organizational identity, instilling discipline in exploration, and embedding empathy and self-awareness. CEOs can transform emotional hurdles into sources of innovation and renewal.

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