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It has been argued that strategic leadership plays a crucial role in mediating between forces for exploration such as innovation and change, and inertial forces for exploitation of the status quo. In mediating these contradictory forces, strategic leaders need to make decisions and take actions that enable and encourage the firm to balance exploration as well as exploitation. The purpose of this study is to investigate how strategic leaders create an organization culture within which the contradictory forces for exploration and exploitation vie. Although it has been argued that strategic leadership plays a crucial role in fostering exploration and exploitation, this is the first study to empirically investigate the multiple roles that leaders need to play in creating a culture that in turn, facilitates exploration and exploitation activities in the form of incremental and radical product and process innovation. By doing so, our study contributes to our understanding of ambidexterity by identifying the multiple roles that leaders play, as well as the role organization culture plays in mediating the leadership and ambidexterity relationship. Using empirical data derived from a research study of 125 firms in Taiwan, we applied multiple regression analyses-the Sobel and Bootstrapping approach to test our hypotheses that: 1) strategic leadership directly impacts on a knowledge-sharing culture, 2) a knowledge-sharing culture directly impacts on innovation ambidexterity, and 3) organizational culture mediates the strategic leadership and innovation ambidexterity relationship. All three of our hypotheses were supported.
Date of Publication: Aug. 2011