1. Introduction
Over the past decade, artificial intelligence (AI) has become prevalent in sustaining our daily lives. This has increasingly attracted the attention of researchers in academia, business, and governance. However, the business environment is continuously evolving. A firm that dominates the AI industry one day could cease to exist the next day. Therefore, firms need to innovate products and processes in a volatile environment to survive, grow, and sustain competitive advantages [
1].
Exploration and exploitation of ambidexterity are two key components to obtaining greater product innovativeness [
2]. This allows firms to reconfigure their assets and develop new skills to address emerging threats and opportunities [
3]. However, few studies have examined the leaders of ambidextrous organizations. Based on contingency theory studies, followers are affected by the behavior and characteristics of leadership in the context of innovation creation [
4]. According to Schaubroeck et al. [
5], leaders are responsible for allocating and controlling organizational resources. The degree of effectiveness with which these resources are allocated is a key determinant of the level of investment in R&D activities within an organization [
6]. This study investigates how the ambidextrous leadership model affects product innovativeness. The ambidextrous leadership model proposed by Rosing et al. [
7] introduces two types of leadership behavior: opening and closing, which respectively emphasize exploration and exploitation. This model highlights the importance of the flexible application of both leader behaviors based on situational demands, as supported by Zacher and Rosing [
2]. Several promising pieces of evidence demonstrate a positive correlation between these two factors, indicating that ambidextrous leadership contributes to better innovation performance [
2,
8]. Additionally, Tuan Luu [
9] contends that the emotional equilibrium between the continuity and fluctuation of employees can be promoted by an ambidextrous leadership style, leading to reduced employee unease toward uncertainty and enhanced self-assurance to engage in innovative and risk-taking activities. Consequently, ambidextrous leadership has the potential to cultivate proactive, innovative, and risk-taking behaviors in firms.
A large body of literature finds that firms experience a failure rate of approximately 40% in their product innovations due to the absence of a focus on the ever-changing market environment [
10,
11]. Accordingly, organizational agility (OA) is closely linked to dynamic capability, a critical success factor for firms operating in unpredictable business environments [
12,
13]. OA empowers firms to promptly respond to valuable market information when making product innovation decisions and efficiently execute new innovation plans [
10]. Two examples are Dell EMC’s accelerated IT innovation and Apple’s strategically fast investment in the Apple Watch, which captured 75.5% of the global smartwatch market share [
14].
Nevertheless, in an ever-changing world marked by geopolitical upheavals, global talent shortages, and the complexities of big data management, high-tech organizations constantly face new challenges in sustaining their competitiveness and relevance. Rosing et al. [
7] point out that limited research demonstrates how leaders can effectively balance exploring new opportunities by exploiting current advantages. Consequently, there is limited practical and theoretical knowledge on how leaders can effectively implement ambidexterity to enhance product innovativeness. The underlying drivers are little understood. In other words, does ambidextrous leadership directly impact product innovation or work through intermediate mechanisms [
6,
15]? Hughes et al. [
16] argue that there is a lack of rigorous empirical analysis and inadequate demonstration in the literature regarding the importance of ambidextrous leader behaviors in the innovation process.
Li et al. [
15] advocate that leaders must be capable of flexibly adjusting their behaviors to suit the evolving spatial situations and distinct qualities of their subordinates, such as their abilities, expectations, roles, and personalities. Therefore, there is a certain level of alignment between ambidextrous leadership and OA. Aurélio de Oliveira et al. [
17] assert that leadership plays a crucial role in determining employees’ and teams’ agility and flexibility, which are essential factors affecting organizational performance. Denning’s [
18] study on strategic management highlights that agility is the driving force behind innovation. Several studies also indicate that leaders can deploy agility by establishing organizations that can adapt their structure, redistribute resources, and hire employees primed to embrace and navigate change. This implies that OA could act as a mediating factor between ambidextrous leadership and product innovativeness. However, achieving OA is challenging for most firms despite its crucial role [
10,
19]. Whether ambidextrous leadership plays a vital role as an OA antecedent remains ambiguous. Few studies focus on developing OA for product innovation despite its recognized importance [
20]. Studies in the field of entrepreneurship have primarily focused on investigating the relationship between a firm’s performance and its entrepreneurial orientation. However, the relationships between product innovativeness and the moderating effects of entrepreneurial orientation, synergistically working on ambidextrous leadership and OA, were underexplored.
The primary objective of this study is to assess the factors contributing to product innovativeness in firms operating in the AI industry. Furthermore, this study aims to elucidate a suitable mechanism to explain the potential connections between these crucial organizational factors. Particularly, the purpose of this study is to (1) explore the impact of ambidextrous leadership on product innovativeness, (2) examine the role of OA as a potential mechanism in the possible linkages, and (3) explore the moderating effect of entrepreneurial orientation on the intercorrelations among these factors.
From an academic perspective, this study makes several contributions to existing research. First, it highlights the significance of Rosing et al.‘s [
7] model of ambidexterity and leadership in product innovation. Second, by offering a better understanding of the role of leadership in OA, this study helps organizations adapt and respond to changing circumstances, which is essential for achieving long-term success. This study provides practical guidance for companies, such as encouraging them to create customized training programs for leaders to enhance OA and boost product innovation. It also offers valuable AI insights for R&D decision-making and suggests ways to enhance efficiency and effectiveness in long-term AI product development.
This study is organized as follows. The following section presents a literature review and hypothesis development, followed by the theoretical background of the research model. Subsequent sections encompass the research methodology, data analysis, discussions, and implications.
5. Discussion
This study explored the potential mechanisms of ambidextrous leadership in product innovativeness from OA and entrepreneurial orientation perspectives. This study offers preliminary support for the ambidexterity theory of leadership, OA, and entrepreneurial orientation as contributors to product innovativeness.
First, ambidextrous leadership demonstrates a significant positive influence on product innovativeness, consistent with the findings of related studies [
6,
7,
64]. However, the results suggest that open leader behavior used alone exerts a less significant influence on product innovativeness. This may be because open leader behaviors are less goal-oriented, exhibit a high level of error tolerance, and involve experimentation with radical creativity despite risks. Consequently, firms may experience low product innovativeness due to a lack of communication among coworkers and substantial errors and failures in new product development. However, product innovativeness is enhanced when both types of leadership behaviors are engaged simultaneously. This finding is consistent with previous studies [
2,
7] that have highlighted the need for a combination or interaction of the two complementary sets of leadership behaviors to facilitate innovation, given the complexity of the process. Closing leader behaviors, which are goal-attainment-oriented and focus on unifying routines and rules to reduce errors, can synergize with opening leader behaviors to amplify the level of product innovativeness beyond what opening or closing leader behaviors alone can achieve.
Second, ambidextrous leadership significantly impacts OA, whereas closing leaders’ behaviors alone are less critical in facilitating agility. This may be due to the controlling nature of closing leader behaviors, which restrict flexibility and quick responsiveness within an agile organization. Kumkale [
24] reports that organizational ambidexterity directly and positively affects the four dimensions of OA. This implies that applying AL to firms can lead to higher competence, flexibility, speed, and responsiveness. Additionally, OA directly positively influences product innovativeness and partially mediates the relationship between AL and product innovativeness. Thus, OA is an essential antecedent of PI and serves as a bridge between AL and PI. With both exploratory and exploitative leadership styles, a more agile organization promotes product innovativeness along the path.
Moreover, it has been proven that a positive synergy exists between EO and ambidextrous leadership and OA concerning product innovativeness. This finding aligns with a substantial body of research arguing for the numerous benefits of implementing EO regarding firm performance [
65]. One of the main characteristics of EO is risk taking, which is closely linked to an opening leader’s behavior and flexibility of the AG. This necessitates environments with loose routines and rule orientations and relies heavily on exploratory activities rather than exploitative ones. The responsiveness of AG is also consistent with open leader behaviors and risk-taking, as responsiveness is primarily triggered by changes in the business environment, requiring bold and decisive decision-making. The proactiveness of the EO signifies a stance that demands the speed of AG and goal attainment facilitated by closing leadership behaviors. All these effects contribute to a higher level of product innovativeness, enabling future market acquisitions and competition against rivals. AL further enhances the EO’s innovativeness and the AG’s competence, leading to higher levels of product innovativeness. Therefore, the interactions between AL, the four dimensions of AG, and EO are crucial factors that should not be overlooked. Their abilities, particularly in resource acquisition and allocation through exploration and exploitation, contribute to the successful development of new products within firms, ultimately sustaining business operations and introducing new, beneficial products to the world.
6. Implications
6.1. Theoretical Implications
There are several contributions to the literature on leadership and new product development that are vital for sustaining the competitiveness of firms and industries. First, very few studies have evaluated the impact of AG. This study further reveals the link between AL and PI, highlighting AG’s partial mediating effects. This finding aligns with the concerns raised by Lu and Ramamurthy [
19] and Cai et al. [
10] regarding the importance of developing OA in product innovation alongside ambidextrous leadership, thus addressing the lack of comprehensive studies in this realm. Moreover, this study fills an empirical analysis gap in researching the role of ambidextrous leader behaviors in PI and AG, as noted by Hughes et al. [
16] and Chakravarty et al. [
20]. Consequently, this study provides a new direction for future research to further understand the underlying mechanisms. Overall, this study contributes to the existing literature by shedding light on the interplay between AL, AG, and PI, enhancing our knowledge of leadership dynamics in the context of new product development.
Additionally, this paper highlights the vital role of ambidextrous leadership in the context of new product development, presenting it as an exemplary model of effective leadership. The fusion of both opening and closing leader behaviors emerges as essential for driving innovation success, as these distinct leadership approaches cater to the dual needs of stimulating creativity and ensuring effective idea implementation [
7,
41]. This stands as a clear advantage compared to traditional leadership approaches when encountering innovation. The distinctive attributes of the ambidextrous leadership model establish a theoretical foundation for distinguishing it from traditional leadership styles, underscoring its significance within innovation processes as effective leadership.
This study also provides further support for the argument that both opening and closing leader behaviors significantly enhance innovation performance, consistent with prior research [
2,
8,
41]. Importantly, the results contribute to the ambidextrous leadership literature by demonstrating the positive relationship between these behaviors within a Chinese context, thus broadening the scope beyond previous studies conducted in Germany [
41], the USA [
8], and Australia [
2].
Moreover, although the influence of EO on innovation has been evaluated in prior studies, new evidence demonstrates that when employed to handle the difficulties of new product innovation, it can facilitate both AL and AG in enhancing product innovativeness more effectively. The link between these factors can be integrated into a new mechanism that allows for a better understanding of the moderating effect of EO on product innovativeness in ambidextrous and agile firms.
6.2. Practical Implications
This study offers several practical implications for product innovation teams. In terms of ambidextrous leadership, due to differences in follower perceptions, various types of task requirements, and the varying stages of the product innovation process, leaders must know how to adjust, switch, or combine different styles of behavior according to the capabilities, personal characteristics, expectations, and nature of tasks. A one-size-fits-all approach to behavior may not work for all team members in product innovation, especially in AI or high-tech industries. With the effect of AL, organizations become more agile. Leaders should be quickly aware of this and adjust their behavior to promote agility among team members. For example, they can exhibit open behaviors to facilitate flexibility and responsiveness in innovation tasks. Conversely, leaders must switch to closing behaviors to emphasize goal-attainment orientation among followers if a delay or slack occurs. Moreover, from the perspective of opening up leader behavior and EO, followers’ risk-taking behaviors can be promoted to a certain degree, as innovation requires novel ideas and creativity. With the adoption of EO, innovation teams can become more proactive in exploring and exploiting existing or new resources to fulfill product innovation needs. Leaders can also encourage followers to explore novel ways or processes to address uncertainties and enhance product innovation. Furthermore, firms must incrementally foster a culture that connects these factors to enhance their overall potential to cope with the changes or complexities that emerge with new product innovations. With this agenda, firms can gain better resource allocation and utilization capabilities and attain competencies. New products should be strategically introduced into the industry, leading to sustainable development.
This study reinforces the understanding that ambidextrous leadership enables firms to thrive, whether in the short term or the long term, by creating a dynamic equilibrium in organizations that exclusively focus on exploration risk instability and resource depletion, conversely, in those overly fixated on exploitation become stagnant, missing out on crucial innovations. Furthermore, the findings underscore the pivotal role of ambidextrous leadership and product innovativeness in ensuring that core processes run smoothly, costs are controlled, and operational excellence is achieved. Consequently, resources are optimized, waste is minimized, products become more sustainable, and environmental impact is reduced. By studying these critical factors, firms can foster societal well-being and create a sustainable environment. Firms with higher innovativeness are adept at facilitating sustainability across all dimensions of our world—technological, market, and environmental.
7. Limitations and Future Directions
Ambidextrous leadership, a contradictory yet complementary leadership style, is insufficient in a cross-sectional study to determine the outcomes of product innovation based on independent factors. Therefore, a longitudinal study could further investigate the relationships between all dimensions. Additionally, AG partially mediates the relationship between AL and PI, implying that several other factors act as mediators in organizations’ product innovation processes. Hence, future studies should include additional factors such as adhocracy culture and knowledge-based dynamic capabilities to gain a deeper understanding. This study provides a new direction for future research that combines these three factors and generates a unique synergy to impact innovation.
Finally, data for this study were collected exclusively from the Yangtze River Delta (YRD) region of China and focused solely on the AI industry. This geographical and industry-specific restriction may limit the generalizability of our findings to other regions or industries. Future research could expand the scope of this study by collecting data from multiple regions within China and across different countries. Researchers could compare the similarities and differences in a wider range of regions. In addition, future studies could investigate sectors beyond the AI industry to help identify potential synergies and interdependencies between different industries, providing valuable insights into the broader impacts of ambidextrous leadership and its implications for achieving sustainable competitive advantages through product innovativeness.