Achieving service quality through service innovation exploration-exploitation: The critical role of employee empowerment and slack resources

Purpose This study investigates the effects of service innovation exploration-exploitation on financial performance through the delivery of quality services. Additional emphasis is also given to examining the extent to which employee empowerment and slack resources enhance or suppress the performance benefits of service firms engaging in service innovation exploration versus exploitation. Design/methodology/approach Data were drawn from a multi-informant survey of service firms using a drop-and-collect approach. The survey gathered data from managers, customer service employees and customers to test the hypotheses. Findings The results show that excelling at both exploitative and exploratory innovation helps enhance the quality of services, which in turn yield superior financial performance. Further, empowering employees enhances the relationship between exploratory and exploitative service innovation and service quality. We also show that the extent managers’ perceived their market to be competitive influences in the pursuit of high levels of both service innovation exploration and exploitation and that this relationship is impacted by the extent they believe they have available slack resources. Practical implications The findings suggest that service firms need to pursue both exploitation and exploration at high levels simultaneously and empower their employees to stay ahead of competitors in delivering quality services, which ultimately contribute to the achievement of superior financial outcomes. Also, the findings highlight the importance of employee empowerment, market competitiveness and slack resources in the pursuit of high levels of both service innovation exploration and exploitation. Originality/value These findings and our theory indicate that this study is the first to empirically examine organizational ambidexterity in the context of service innovation exploration – exploitation adopting the principles of combined and balanced innovation. The study provides insights into the critical role of customers’ perceptions of service quality in contributing to firms’ financial performance. Our insights are unique in that the study incorporates managers, employees and customers in an integrated service innovation model.

The Role of Ambidexterity in Marketing Strategy Implementation: Resolving the Exploration-Exploitation Dilemma

Formulating consistent marketing strategies is a difficult task, but successfully implementing them is even more challenging. This is even more pertinent as marketing strategies quite often incorporate inherent conflicts between major breakthroughs and consolidation. Consequently, marketers need to balance exploratory and exploitative strategies. However, the literature lacks concrete insights for marketing managers as to how exploratory and exploitative strategies can be best combined. This paper addresses this issue by introducing a framework of multiple types of ambidexterity. Based on qualitative research, tools and procedures are identified to overcome marketing dilemmas and support strategy implementation by drawing on ambidextrous designs.

A Bayesian formulation of search, control and the exploration/exploitation trade-off

A new approach to optimisation is introduced based on a precise probabilistic statement of what is ideally required of an optimisation method. It is convenient to express the formalism in terms of the control of a stationary environment. This leads to an objective function for the controller which unifies the objectives of exploration and exploitation, thereby providing a quantitative principle for managing this trade-off. This is demonstrated using a variant of the multi-armed bandit problem. This approach opens new possibilities for optimisation algorithms, particularly by using neural network or other adaptive methods for the adaptive controller. It also opens possibilities for deepening understanding of existing methods. The realisation of these possibilities requires research into practical approximations of the exact formalism.

Exploration and exploitation : the interplay between knowledge and continuous innovation

In rapidly changing environments, organisations require dynamic capabilities to integrate, build and reconfigure resources and competencies to achieve continuous innovation. Although tangible resources are important to promoting the firm’s ability to act, capabilities fundamentally rest in the knowledge created and accumulated by the firm through human capital, organisational routines, processes, practices and norms. The exploration for new ideas, technologies and knowledge – to one side – and – on the other one – the exploitation of existing and new knowledge is essential for continuous innovation. Firms need to decide how best to allocate their scarce resources for both activities and at the same time build dynamic capabilities to keep up with changing market conditions. This in turn, is influenced by the absorptive capacity of the firm to assimilate knowledge. This paper presents a case study that investigates the sources of knowledge in an engineering firm in Australia, and how it is organised and processed. As information pervades the firm from both internal and external sources, individuals integrate knowledge using both exploration and exploitation approaches. The findings illustrate that absorptive capacity can encourage greater leverage for exploration potential leading to radical innovation; and reconfiguring exploitable knowledge for incremental improvements. This study provides an insight for managers in quest of improving knowledge strategies and continuous innovation. It also makes significant theoretical contributions to the literature through extending the concepts of

Ambidextrous leadership and employees' self-reported innovative performance: The role of exploration and exploitation behaviors

The ambidexterity theory of leadership for innovation proposes that leaders' opening and closing behaviors positively predict employees' exploration and exploitation behaviors, respectively. The interaction of exploration and exploitation behaviors, in turn, is assumed to influence employee innovative performance, such that innovative performance is highest when both exploration and exploitation behaviors are high. The goal of this study was to provide the first empirical test of these hypotheses at the individual employee level. Results based on self-report data provided by 388 employees were consistent with ambidexterity theory, even after controlling for employee reports of their leaders' transformational and transactional leadership behaviors as well as employees' openness to experience, conscientiousness, and positive affect. The findings extend previous research on ambidexterity at the team and organizational levels and suggest a possible way for leaders to enhance employee self-reported innovative performance.

Learning to act in uncertain environments : technical perspective

The problem of decision making in an uncertain environment arises in many diverse contexts: deciding whether to keep a hard drive spinning in a net-book; choosing which advertisement to post to a Web site visitor; choosing how many newspapers to order so as to maximize profits; or choosing a route to recommend to a driver given limited and possibly out-of-date information about traffic conditions. All are sequential decision problems, since earlier decisions affect subsequent performance; all require adaptive approaches, since they involve significant uncertainty. The key issue in effectively solving problems like these is known as the exploration/exploitation trade-off: If I am at a cross-roads, when should I go in the most advantageous direction among those that I have already explored, and when should I strike out in a new direction, in the hopes I will discover something better?

Open problem : adversarial multiarmed bandits with limited advice

Adversarial multiarmed bandits with expert advice is one of the fundamental problems in studying the exploration-exploitation trade-o. It is known that if we observe the advice of all experts on every round we can achieve O(√KTlnN) regret, where K is the number of arms, T is the number of game rounds, and N is the number of experts. It is also known that if we observe the advice of just one expert on every round, we can achieve regret of order O(√NT). Our open problem is what can be achieved by asking M experts on every round, where 1 < M < N.

How the energy sector could get it wrong with cloud computing

Cloud computing has significantly impacted a broad range of industries, but these technologies and services have been absorbed throughout the marketplace unevenly. Some industries have moved aggressively towards cloud computing, while others have moved much more slowly. For the most part, the energy sector has approached cloud computing in a measured and cautious way, with progress often in the form of private cloud solutions rather than public ones, or hybridized information technology systems that combine cloud and existing non-cloud architectures. By moving towards cloud computing in a very slow and tentative way, however, the energy industry may prevent itself from reaping the full benefit that a more complete migration to the public cloud has brought about in several other industries. This short communication is accordingly intended to offer a high-level overview of cloud computing, and to put forward the argument that the energy sector should make a more complete migration to the public cloud in order to unlock the major system-wide efficiencies that cloud computing can provide. Also, assets within the energy sector should be designed with as much modularity and flexibility as possible so that they are not locked out of cloud-friendly options in the future.

Using Big Data to manage safety-related risk in the upstream oil and gas industry: A research agenda

Despite considerable effort and a broad range of new approaches to safety management over the years, the upstream oil & gas industry has been frustrated by the sector’s stubbornly high rate of injuries and fatalities. This short communication points out, however, that the industry may be in a position to make considerable progress by applying “Big Data” analytical tools to the large volumes of safety-related data that have been collected by these organizations. Toward making this case, we examine existing safety-related information management practices in the upstream oil & gas industry, and specifically note that data in this sector often tends to be highly customized, difficult to analyze using conventional quantitative tools, and frequently ignored. We then contend that the application of new Big Data kinds of analytical techniques could potentially reveal patterns and trends that have been hidden or unknown thus far, and argue that these tools could help the upstream oil & gas sector to improve its injury and fatality statistics. Finally, we offer a research agenda toward accelerating the rate at which Big Data and new analytical capabilities could play a material role in helping the industry to improve its health and safety performance.

Simulating dynamic covariance structures for testing the adaptive behavior of variable selection algorithms (Invited Paper)

Variable selection for regression is a classical statistical problem, motivated by concerns that too large a number of covariates may bring about overfitting and unnecessarily high measurement costs. Novel difficulties arise in streaming contexts, where the correlation structure of the process may be drifting, in which case it must be constantly tracked so that selections may be revised accordingly. A particularly interesting phenomenon is that non-selected covariates become missing variables, inducing bias on subsequent decisions. This raises an intricate exploration-exploitation tradeoff, whose dependence on the covariance tracking algorithm and the choice of variable selection scheme is too complex to be dealt with analytically. We hence capitalise on the strength of simulations to explore this problem, taking the opportunity to tackle the difficult task of simulating dynamic correlation structures. © 2008 IEEE.

Cortical substrates for exploratory decisions in humans.

Decision making in an uncertain environment poses a conflict between the opposing demands of gathering and exploiting information. In a classic illustration of this 'exploration-exploitation' dilemma, a gambler choosing between multiple slot machines balances the desire to select what seems, on the basis of accumulated experience, the richest option, against the desire to choose a less familiar option that might turn out more advantageous (and thereby provide information for improving future decisions). Far from representing idle curiosity, such exploration is often critical for organisms to discover how best to harvest resources such as food and water. In appetitive choice, substantial experimental evidence, underpinned by computational reinforcement learning (RL) theory, indicates that a dopaminergic, striatal and medial prefrontal network mediates learning to exploit. In contrast, although exploration has been well studied from both theoretical and ethological perspectives, its neural substrates are much less clear. Here we show, in a gambling task, that human subjects' choices can be characterized by a computationally well-regarded strategy for addressing the explore/exploit dilemma. Furthermore, using this characterization to classify decisions as exploratory or exploitative, we employ functional magnetic resonance imaging to show that the frontopolar cortex and intraparietal sulcus are preferentially active during exploratory decisions. In contrast, regions of striatum and ventromedial prefrontal cortex exhibit activity characteristic of an involvement in value-based exploitative decision making. The results suggest a model of action selection under uncertainty that involves switching between exploratory and exploitative behavioural modes, and provide a computationally precise characterization of the contribution of key decision-related brain systems to each of these functions.

叠前地震多角度三参数同步反演方法

Pre-stack seismic inversion has become the emphasis and hotspot owing to the exploration & exploitation of oil field and the development of seismic technology. Pre-stack seismic inversion has the strongpoint of making the most of amplitude versus offset compared with the post-stack method. In this dissertation, the three parameters were discussed from multi-angle reflectance of P-wave data based on Zoeppritz’s and Aki & Richard’s equation, include P-wave velocity, S-wave velocity, and density. The three parameters are inversed synchronously from the pre-stack multi-angle P-wave data, based on rockphysics model and aimed at the least remnant difference between model simulation and practical data. In order to improve the stability of inversion and resolution to thin bed, several techniques were employed, such as the wavelet transform with multi-scale function, adding the Bayesian soft constraint and hard constraints (the horizon, structure and so on) to the inversion process. Being the result, the uncertainty of the resolution is reduced, the reliability and precision are improved, the significance of parameters becomes clearer. Meeting to the fundamental requirement of pre-stack inversion, some research in rockphysics are carried out which covered the simulation and inversion of S-wave velocity, the influence of pore fluids to geophysical parameters, and the slecting and analyzing of sensitive parameters. The difference between elastic wave equation modeling and Zoeppritz equation method is also compared. A series of key techniques of pre-stack seismic inversion and description were developed, such as attributes optimization, fluid factors, etc. All the techniques mentioned above are assembled to form a technique sets and process of synchronous pre-stack seismic inversion method of the three parameters based on rock physics and model simulation. The new method and technology were applied in many areas with various reservoirs, obtained both geological and economic significance, which proved to be valid and rational. This study will promote the pre-stack inversion technology and it’s application in hidden reservoirs exploration, face good prospects for development and application.

Petróleo e indígenas en Colombia. Una mirada desde la seguridad humana

En Colombia las actividades de exploración, explotación, transporte y procesamiento de hidrocarburos que se vienen realizando desde comienzos del siglo XX son responsables de grandes procesos de transformación del territorio y de degradación de los ecosistemas en los que se realizan. Estos procesos han impactado negativamente la seguridad de las comunidades indígenas poniendo en riesgo su cultura y en algunos casos su existencia misma. Aunque históricamente los derechos de estas poblaciones frente a la explotación petrolera, y minera en general, han cambiado y su autonomía e integridad es protegida por la Constitución de 1991, las comunidades siguen teniendo una alta vulnerabilidad frente a la intervención de los ecosistema que habitan.La degradación ambiental producida directamente por las actividades petroleras y por los procesos de colonización que estas impulsan se constituye en una amenaza a la seguridad de las comunidades, cuyos territorios y recursos de subsistencia se ven disminuidos. La colonización y la presión sobre los recursos naturales que esta produce son motivadas principalmente por la pobreza de poblaciones campesinas que buscan nuevas tierras para habitar, a su vez estos dos procesos son causa de degradación ambiental que empobrece a las comunidades étnicas debido a que afecta sus fuentes de sustento, situación que genera inseguridad para los indígenas. Adicionalmente, la degradación ambiental y la disminución de los territorios ponen en riesgo la cultura de estos grupos humanos, pues afecta sus valores, tradiciones, autoridades y, en general, su forma de vida lo que constituye una amenaza a su seguridad.-----In Colombia, the exploration, exploitation, transport, and processing of hydrocarbons since the beginning of the 20th century have caused great territory transformations and ecosystem degradation. These processes have impacted adversely the indigenous communities security, exposing their culture and, in some cases, their existence itself. Even though, facing oil and, in general, mineral exploitation, the rights of this population have changed historically and their autonomy and integrity is protected by the 1991 Constitution, the communities are still highly vulnerable to the intervention on the ecosystem they inhabit.The environmental degradation directly arisen from the oil exploitation activities and the colonization they have driven, has become a threat to the security of the communities whose territories and subsistence resources have been reduced. Colonization and the resulting natural resource pressure are mainly caused by the poverty of the country population that seek new lands to occupy and these two facts cause in turn the environmental degradation that impoverish the ethnic communities by affecting their living sources, thereby causing insecurity to the indigenous population. In addition, environmental degradation and territory reduction risk these human groups’ culture by impacting their values, tradition, authorities and, in general, their way of living, and therefore turn into a threat to their security.