How to Score the Right Balance – Exploration and Exploitation in International Contexts. The case of FIFA and the FIFA World Cup

Abstract

H. Hultman and T. Vukman I Abstract One of the challenges of operating in dispersed international markets is that, as the context changes, learnings that have been institutionalized in an organization might not fit in a new international context. In order to adapt existing knowledge to a new international context and a new institutional setting, there is a need to balance exploitation of old knowledge and exploration of the new environment. Successful organizations that are capable of operating in dynamic environments are said to be ambidextrous as they have the ability to simultaneously explore and exploit in adapting to changes in context. However, limited research has been conducted on the international aspect of ambidexterity and how organizations can use ambidextrous dimensions when responding to the challenges of operating in different international contexts. In addition, current research has observed a lack of empirical evidence of how the context may affect the optimal balance between exploration and exploitation. This case study concerns how FIFA handles the challenges of adapting to different international environments while moving between countries and continents in arranging the FIFA World CupTM. Our results suggest that the optimal balance between exploration and exploitation may depend on the type of change in context. When there is a slight change in context, the need for exploration is reduced and more emphasis should be put on exploitation and the opposite is true for the reversed situation.