Innovation ambidexterity: balancing exploitation and exploration for startup and established restaurants and impacts upon performance

This study was designed to examine how important a balance between exploitation (proximity to existing technologies, products and services) and exploration (proximity to existing consumer segments) representing innovation ambidexterity, would be for improved restaurant performance. Also investigated was whether or not innovation ambidexterity played different roles in performance with respect to stages of business life cycles represented by startup and established restaurants. Using data obtained from 317 owners and managers of independent casual dining restaurants, a nonlinear approach was adopted to test our hypotheses. Results supported the significant and positive relationship between innovation ambidexterity and restaurant performance. More specifically, balancing exploitative and exploratory innovation was significantly and positively associated with startup restaurant performance. However, its relationship with established restaurant performance was not significant. Results also confirmed that exploitative innovation was more important than exploratory innovation for startup restaurants, while exploratory innovation was more important for established restaurants.