The effect of IT ambidexterity and cloud computing absorptive capacity on competitive advantage

Purpose: Founded on the concept of organizational ambidexterity and the competing value model, the purpose of this paper is to develop an information technology (IT) ambidexterity framework to underscore the importance of a balanced and harmonious IT environment in enterprise cloud adoption. Design/methodology/approach: With survey responses from 165 IT executives in a managerial position who are in charge of cloud computing implementation, partial least square method is used to test the research model. Findings: Cloud absorptive capacity plays an important role for firms to secure a competitive advantage. The synergy of the two capabilities (flexibility and control), which have conflicting characteristics, contributes to the enhancement of cloud absorptive capacity and leads to a firm’s knowledge accumulation and performance. Research limitations/implications: This study is the very first attempt that empirically establishes the relationship between a firm’s competitiveness and cloud computing absorptive capacity. This study provides a comprehensive framework that integrates ambidexterity theory with the competing value framework (CVF) with extending the concept of absorptive capacity that is bounded within an organizational perspective into a cloud computing context. Practical implications: Firms should treat cloud computing as a strategic consideration to secure a competitive advantage in the contemporary business environment. For a firm’s performance, a dual governance structure, that encompasses flexibility and control, is required to achieve competitive advantage from cloud computing adoption. Originality/value: To facilitate organizational effort in achieving a harmonious cloud environment, the authors propose a comprehensive ambidexterity framework integrating the CVF approach. This framework maps IT ambidexterity onto the CVF. As CVF considers internal and external factors that ambidexterity theory does not cover, integrating two theories can provide more comprehensive implications and discussions regarding cloud computing adoption.