Where does it come from? Formation of innovative ambidexterity within SMEs in turbulent times

This study investigates how small and medium-sized enterprises (SMEs) achieve and manage innovative ambidexterity through their dynamic capability, addressing potential imbalances in changing environments under resource constraints. Employing a comparative case study approach, the research draws on qualitative, in-depth interviews with CEOs and founders of four Russian SMEs operating in the Information Technology (IT) sector, selected from a larger cohort. Key capabilities were identified for each phase of the dynamic capability process. In the sensing phase, essential capabilities include cultivating dynamic technological and marketing skills, problem-solving proficiency and commitment to continuous learning with real-time awareness. In the seizing phase, the emphasis shifts to enhancing capabilities through learning, fostering innovation-driven culture, empowering employees, providing continuous training, promoting active collaboration at all levels, and recognizing achievements through team rewards. During the reconfiguration phase, adaptive decision-making, resource and coordination flexibility and future-oriented innovation and partnerships become critical. These capabilities contribute to a balance of exploratory and exploitative innovation within SMEs enabling the achievement of innovative ambidexterity. Throughout this process, potential imbalances are managed by leveraging critical capabilities such as clear goal-setting and performance feedback, culture of openness, trust, and mutual support, and adaptive decision-making with wise allocation of firm-specific resources. Through our findings, we advance the understanding that ambidexterity is achievable for resource-constrained SMEs in uncertain environment under external constraints, offering insights into dynamic capabilities that enable such attainment.