Virtuous Cycles of Ambidexterity: Zalando's Secret to Business Success - Essay Sample

Introduction

Today, given the abundance of technological innovation, it has become more critical for companies to become successful on more than one front; exploitation and exploration. On average, the Virtuous Cycles of Ambidexterity defines the paradigm during which a company attempts to engage both exploitative and explorative functions, simultaneously. This approach, adopted by Zalando, allows the companies that adopt them to surge ahead of their competition. The main driving factor of chasing the ambidexterity narrative is basically to capture the powers of opportunity cost. Chasing competencies across two fronts, as opposed to across only one, allows for organizations like Zalando to discover opportunities where they otherwise would not have found any, as well as make the most of their current resources and circumstances. The costs that come from the company forsaking other opportunities become eliminated.

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Zalando, as a company, has been able to achieve both close ties amongst its staff corps as well as the ability to implement novel ideas, a combination of capabilities that have been traditionally difficult for companies to achieve. For most traditional companies, they often have close ties amongst their staff corps, which elevates the company’s ability to implement emergent ideas, yet which limits the company's capacity for new innovative ideas to rise to the top. Similarly, companies that have found ways for the best ideas to rise to the top have found themselves in the scenarios where the ties between their staff members are not as strong as they could be, which handicaps the firm's ability to implement them and undertake these proposed changes.

The exciting thing about Zalando is that the company has somewhat managed to manage both the unity and close ties amongst its team members that allow for the implementation of ideas and strategy, as well as keeping just the right amount of mutual respect and experimentation amongst their staff members that provide for the best ideas to rise to the top to stand the chance of implementation. This defines the very nature of the virtue of ambidexterity that Zalando has been able to establish quite strongly. Amongst the most notable ways through which they can do this is by encouraging community members to float ideas that ultimately stand the chance of implementation. Besides, this is achieved by the companywide objectives to exploit existing resources while simultaneously exploring new opportunities at innovation.

Exploration is the type of work that is driven by creativity, and which determines the future endeavors that the company undertakes. At the same time, exploitation is the type of work that aims to improve upon existing processes. While explorative work brings up new ways of doing things, upending old systemic orders, exploitative work looks at existing operations. It aims to optimize them for the long term benefit of the company at hand. Zalando’s exploitative efforts include a sizing department that churns through the clothing of various sizes, with the ultimate goal of providing customers with their correct sizes as quickly and as accurately as possible (Sohl, Vroom & Fritza, 2020). The sizing problem presents the biggest headaches for clients served by Zalando. As such, it is solving the sizing problem would one of the single most significant moves made by Zalando to improve the overall customer experience.

An example of Zalando's exploratory efforts is the adoption of a multi-sided platform, which aims to bring together different fashion brands and retail stores to sell their wares on the platform built by them Zalando. The selling point for this multi-faceted platform is that it is an innovative way to make sales. Its advantages include increased efficiency for every seller and retail shop on the platform.

Figure SEQ Figure \* ARABIC 1 Graphic Indicating Virtuous Cycles of Ambidexterity in an organization.

Research QuestionThis submission aims to explore how Zalando seeks to become the fashion industry's market leader through digital platforms and to apply the theoretical strategy of ambidexterity.

Theoretical Framework

The process of attaining organizational ambidexterity must not be confused for a smooth, conflict-less, and ideal process. More often than not, the struggle to achieving organizational ambidexterity will be accompanied by tensions, despite the entire process e...