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Paper 07

When Organizational Ambidexterity is Half-Committed

A reading brief on HP's struggle to escape its exploitation success trap and what half-committed organizational ambidexterity costs an incubation team.

Status
Class Reflection
Date
Oct 22, 2025
Reading
3 min

Abstract

HP recognizes the need to explore but keeps anchoring new bets to its hardware-revenue gravity. Without aligned incentives, structural separation, and real recombination, organizational ambidexterity stays aspirational, and incubation teams pay the price.

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00 / Paper

Recognizing the need to explore is not the same as committing to it.

In 2021, a new business unit within a Fortune 500 company formed a team and acquired a startup to position itself as a leader in shaping the post-COVID world. Fast-forward 4 years, and the incubation team is on their fifth pivot, treading water as it searches for new value propositions to generate short-term revenue.

This isn't a hypothetical, it's the dynamic my team faces every day as we cut through corporate red tape. HP Inc. is one of the less than 0.1% of companies that have survived for over 40 years (O'Reilly, 2011) and we are currently engaged in an internal battle to become more explorative. For decades, HP has excelled at manufacturing and assembling hardware, a truly exploitative focus that has led the company into a success trap as it recognizes the need to explore but lacks a strong track record in doing so (O'Reilly, 2011).

So why is HP struggling to find market success in an explorative space? The company would claim that it is strategically agile, although its investment portfolio suggests otherwise (Weber, 2014). It has yet to embrace true organizational ambidexterity (OA) (O'Reilly, 2011). In all-employee meetings, we frequently discuss how the future lies in software and recurring-revenue models. However, the messaging clearly identifies a foundation of traditional hardware sales. As O'Reilly (2011) mentions, management must align incentives and compensation, have exploratory teams be disconnected from the main business, and manage conflict of competing resources.

For HP to truly seek the rewards of OA, new teams must move away from revenue growth as a primary KPI and disconnect from the company's legacy processes, while also embracing structural recombination through re-organizations rather than maintaining separate goals (O'Reilly, 2011; Karim, 2015). It's clear that HP is testing the waters of OA, but without intentional execution and a clear cultural shift, it risks remaining stuck in exploitation, and not surviving the next 40 years.

01 / Why I explored this

A class reading brief, opinion-adjacent but sourced. Posting it so the seams between coursework and lived experience inside an incubation team stay visible.

02 / The question I was wrestling with

Why is HP struggling to find market success in explorative spaces despite recognizing the need to shift?

03 / Key insights

  1. 01

    Long-lived exploiters fall into a success trap: they recognize the need to explore but lack the muscle memory to actually do it.

  2. 02

    Real organizational ambidexterity requires aligned incentives, structurally separated exploratory teams, and active management of resource conflict, not just rhetoric about the future.

  3. 03

    Measuring incubation teams primarily on revenue growth quietly re-anchors them to the legacy business and kills exploration.

  4. 04

    Structural recombination via reorganizations beats maintaining parallel siloed goals when the parent company's gravity is hardware-shaped.

06 / Citations

3 citations▸
  1. Karim & Kaul (2015)

    Karim, S., & Kaul, A. (2015). Structural recombination and innovation: Unlocking intraorganizational knowledge synergy through structural change. Organization Science, 26(2), 439–455.link

  2. O'Reilly & Tushman (2011)

    O'Reilly, C. A., III, & Tushman, M. L. (2011). Organizational ambidexterity in action: How managers explore and exploit. California Management Review, 53(4), 5–21.link

  3. Weber & Tarba (2014)

    Weber, Y., & Tarba, S. Y. (2014). Strategic agility: A state of the art. California Management Review, 56(3), 1–8.link

08 / Future questions

  • — What concrete cultural and incentive signals indicate a company is genuinely committed to ambidexterity vs. just experimenting with it?
  • — If not revenue growth, what KPIs actually let an incubation team inside a hardware-anchored parent stay explorative?
← All research

End of paper 07