How do IT misalignments and IT ambidexterity imbalances lead to organizational agility? Substitution, complementarity, and contingency interdependencies with a configurational approach

• Configurational study of IT ambidexterity and IT alignment components for agility. • Unveils interdependencies between exploitation/exploration in IT/business domains. • Complementarity between IT and business explorative capabilities for high agility. • Substitution between IT and business exploitative capabilities for high agility. • Contingent (positive/negative) effects of IT exploitation upon other capabilities. • Four propositions for future research capture the three types of interdependencies. • Explains why certain IT misaligned and non-ambidextrous firms achieve agility. • Reconciles past inconsistent findings. • Demonstrates more pathways to agility than current literature. • Prevents theoretical overdetermination. • Provides insights beyond current research on IT ambidexterity and IT alignment. Two main and separate Information Systems (IS) research streams have investigated the link between information technology (IT) and organizational agility via the concepts of IT ambidexterity and IT alignment. This study examines IT ambidexterity and IT alignment for agility by breaking down each concept and investigating questions regarding the balance between exploitation and exploration alongside those of fit between the IT and business domains. To do so, we apply configurational theory inductively to empirically identify and theorize how interdependencies between capability types (i.e., exploitation and exploration) and domains (i.e., IT and business) lead to agility. A fuzzy set qualitative comparative analysis (fsQCA) of data gathered through a survey of manufacturing SMEs unveils three specific forms of interdependencies: (1) complementarity of exploration between the IT and business domains; (2) substitution of exploitation between the two domains; and (3) contingent effects (positive vs. negative) of each, IT exploitation and IT exploration, depending upon the intensity of the remaining elements. These interdependencies enable the derivation of four theoretically meaningful propositions for future research that reconcile inconsistent findings in both research streams. Overall, this study contributes beyond past research focused on either IT ambidexterity or IT alignment by providing a compelling parsimonious theoretical explanation of how – and which – IT misalignments and imbalances between exploitation and exploration lead to high agility and which do not. These insights are also of high practical value, as they provide manufacturing SMEs with more options to reach agility.