Effect of Ambidexterity on Contestants’ Creative Performance in Open Innovation Contests

Abstract

Innovation contests have been increasingly used to address innovation problems of seeker firms. However, seeker firms complain about low-quality submissions obtained from these contests. Research suggests low-quality submissions may result from contestants’ over-reliance on exploiting experience in solving similar contests. A more balanced approach in submissions involving exploitation and exploration (i.e., individual ambidexterity) will likely enhance creative performance. However, how ambidexterity affects contestants’ creative performance in innovation contests remains obscured. On the one hand, ambidexterity can have synergistic benefits. On the other hand, ambidexterity is costly to employ. We argue that when a contestant invests in cultivating individual ambidexterity, the benefits initially outweigh the costs, leading to enhanced creative performance. However, the costs may outweigh the benefits as individual ambidexterity increases, undermining creative performance. The overall relationship between individual ambidexterity and creative performance in open innovation contests follows an inverted U-shaped pattern. Creative performance was evaluated based on three dimensions—winning rate, submission novelty, and submission usefulness. Two analyses were used to test this relationship. In Analysis 1, we examined a panel dataset comprising 61,152 observations collected over 12 months from 5,096 contestants on a large innovation contest platform. Results support the hypothesis of an inverted U-shaped relationship between individual ambidexterity and contestant winning rate. In Analysis 2, we randomly subsampled 500 contestants from the sample used in Analysis 1. The subsample made 3,168 submissions, which were evaluated for submission novelty and usefulness by 14 experienced contestants (i.e., domain experts). The analysis results demonstrate that individual ambidexterity has an inverted U-shaped relationship with submission novelty but a positive linear relationship with submission usefulness. This work contributes to the literature on individual ambidexterity by identifying the inverse U-shaped relationship in creative contests and demonstrates how ambidexterity affects the three dimensions of creative performance. Suggestions for enhancing creative performance are also proposed.