Building dynamic capability through sequential ambidexterity: a case study of the transformation of a latecomer firm in China

Abstract Sequential ambidexterity is a specific dynamic capability which can play an important role in the technological catch-up of latecomer firms with limited knowledge and resources. Through a longitudinal case study, the trajectory of a latecomer firm's transformation from a generic technology manufacturer to a world-class innovator is analysed. This paper finds that sequential ambidexterity can be the basis of building dynamic capability, which enabled a latecomer to become a market leader through three major transitions. It shows how the building of dynamic capability through sequential ambidexterity is dependent on four mechanisms: senior manager cognition of the environment; organization learning orientation; organization structure design; and process reconfiguration. Building dynamic capability is also dependent on alignment between these mechanisms within the firm. Theoretically, the paper enhances understanding of the micro-foundations of developing dynamic capability through sequential ambidexterity. It also suggests that three contingent dimensions in determining the optimal approach to ambidexterity are: (i) industry leading versus catch-up firms, (ii) the scale of the firm, and (iii) the diversity of the downstream market. Furthermore, the paper provides practical insights for latecomer firms seeking to catch-up with industry leaders.