Decision tree for adaptation after radical changes: linking dynamic capabilities, ambidexterity, and strategic alliances

We developed a decision tree that integrates relevant organizational adaptation theories to respond to radical changes. The understanding of organizational adaptation often requires a combination of multiple theoretical lenses, especially considering today’s radical changes in technologies, markets, and regulations. However, the research streams on adaptation and change are often disconnected and we lack a unifying adaptation framework that might reveal the synergistic contribution of each theoretical perspective to the problem. To fill this important lacuna, we integrate four relevant scholarly perspectives on the topic: dynamic capabilities, ambidexterity, vertical alliances, and horizontal strategic alliances. Our main contribution is an integrative decision tree that unveils when and why each perspective is most appropriate to respond to radical changes. Our research also unpacks dynamic capabilities theory by suggesting when ambidexterity, vertical, and horizontal alliances are appropriate to integrate the upper-level theory of dynamic capabilities, and how they can overcome some of its limitations. The paper also clarifies that, in order to adapt ambidextrously after radical changes destroying core and/or complementary assets, companies need specific alliance strategies.