Evaluating the Performance of an Ambidextrous Bank Using an Agent-based Modeling Approach: A Case Study of Sepah Bank

Document Type : Research Paper


1 Department of Management and Finance, Faculty of Management and Accounting, Farabi Campus, University of Tehran, Qom, Iran

2 Department of Industrial Management, School of Management and Economics, Tarbiat Modares University, Tehran, Iran



Banks are the financial institutions that collect assets from various sources and allocate them to the sectors that require liquidity. Therefore, banks are an inherent element in the system of every country. As private banks enter financial markets, the demand for diverse banking services increases dramatically. Banks seek to use various techniques to improve their performance in attracting customers to increase their market share and profitability. In this regard, assessing the performance of banks is of utmost importance and has become a major activity of bank managers. With the constant changes in the modern world and incessant attempts of competitors to increase their market share by gaining competitive advantage, special attention should be paid to ambidexterity as a key strategy to increase competitive advantage and achieve high performance in dynamic business environments. The present study aimed to identify the ambidextrous factors affecting the performance of banks and present a model to assess the performance of an ambidextrous bank using an agent-based modeling approach. The main objective of the research is to achieve an applied model for managing the performance of the banking industry. The simulation model is processed using the agent-based modeling approach in AnyLogic software environment.


Main Subjects

[1] He, Z., Wong, P., Exploration vs. Exploitation: An Empirical Test of the Ambidexterity Hypothesis. Organization Science, 2004, 15(4) P.481-494, Doi:10.1287/orsc.1040.0078.
[2] March, J., Exploration and exploitation in organizational learning, Organization science, 1991, 2(1), P.71-87, Doi:10.1287/orsc.2.1.71.
[3] Lubatkin, M., Simsek, Z., Ling, Y., Veiga, J., Ambidexterity and performance in Small-to Medium-Sized Firms: The pivotal role of top management team behavioral integration. Journal of Management 2006, 32(5), P. 646-672, Doi:10.1177/0149206306290712.
[4] Wernerfelt, B., Montgomery, C., Tobin’s q and the importance of focus in firm performance. AmEcon Rev 78(1), 1988, P.246-250.
[5] Gibson, C. B., Birkinshaw, J., The Antecedents , Consequences, and Mediating Role of Organizational Ambidexterity, Academy of Management Journal, 2004, 47(2), P.209-226, Doi:10.5465/20159573.
[6] Raisch, S., Birkinshaw, J., Organizational ambidexterity: Antecedents, outcomes, and moderators, Journal of management, 2008, 34, 375-409, Doi:10.1177/0149206308316058.
[7] Tushman, M., L.O'Reilly, C., Ambidextrous Organizations: Managing Evolutionary and Revolutionary Change. California Management Review, 1996, 38(4) P. 8-30, Doi:10.2307/41165852.
[8] Gupta, A., Smith, K., Shalley, C., The interplay between exploration and exploitation. Academy of management journal, 2006, 49(4), P. 693-706, Doi:10.5465/22083026.
[9] Jansen, J., Van Den Bosch, F., Volberda, H., Exploratory innovation, exploitative innovation, and performance: Effects of organizational antecedents and environmental moderators, 2006, 57(4), Doi:10.1287/m nsc.1060.0576·
[10] Levinthal, D. A., March, J. G., The Myopia of Learning. Strategic Management Journal, 1993, 14(s2), P. 95-112, Doi:10.1002/smj.4250141009.
[11] Bradach, J., Using the Plural Form in the Management of Restaurant Chains. Administrative Science Quarterly, 1997, 42(2) P. 276-303, Doi:10.2307/2393921.
[12] Smith, W., Tushman, M., Managing strategic contradictions: A top management model for managing innovation streams. Organization science 2005, 16(5), P. 522-536, Doi:10.1287/1050.0134.
[13] Duncan, R., the ambidextrous organization: Designing Dual Structures for Innovation, in R. Kilman L. Pondy (eds). In The Management of organizational design, 1976, 17(1), P.167-188,
[14] Atuahene-Gima, K., Resolving the capability—rigidity paradox in new product innovation. Journal of marketing, 2005, P.61-83, Doi:10.1509/69.4.61.
[15] Benner, M., Tushman, M., Exploitation, exploration, and process management: The productivity dilemma revisited". Academy of management review, 2003, 28(2), P. 238-256. Doi:10.2307/30040711.
[16] Katila, R., Aduja, G., Something Old, Something New: A Longitudinal Study of Search Behavior and New Product Introduction, Academy of Management Journal, 2002, 45(6), P. 1183-1194, Doi:10.2307/3069433.
[17] Tushman, M., Smith, W, Organizational Technology. Malden: Blackwell, 2002, 16, P.522-536.
[18] Venkatraman, N., Lee, C.-H., Iyer, B, Strategic Ambidexterity and Sales Growth: A Longitudinal Test in the Software Sector, 2007, 14(3), 423-445.
[19] Rosenbloom, R, Leadership, Capabilities, and Technological Change: The Transformation of NCR in the Electronic Era. Strategic Management Journal, 2000, 21(10), P. 1083-1103, Doi:10.1002/1097-0266.
[20] Kauppila, O, Creating Ambidexterity by Integrating and Balancing Separate Interorganizational Partnerships. Strategic Organization, 2010, 8(4), P. 283-312, Doi:10.1177/1476127010387409.
[21] Campanella, F., Manlio, D., Alkis, T., Demetris, V., Ambidextrous organizations in the banking sector: an empirical verification of banks performance and conceptual development. Human Resource Management, 2016, 31, P.1-31, Doi:10.1080/09585192.2016.1239122.
[22] Hu, T., Xie, C., Competition, Innovation, Risk-Taking, and Profitability in the Chinese Banking Sector: An Empirical Analysis Based on Structural Equation Modelling. Discrete Dynamics in Nature and Society, 2016, Article ID 3695379, 10 pages, Doi:10.1155/2016/3695379.
[23] Bos, J., Kolari, J., Van Lamoen, R., Competition and innovation: Evidence from financial services. Journal of Banking, Finance, 2013, 37(5), P. 1590-1601, Doi:10.1016/2012.12.015.
[24] Belderbos, R., Faems, D., Leten, B., Looy, B., Technological activities and their impact on the financial performance of the firm: Exploitation and exploration within and between firms. Product Innovation Management, 2010, 12, P. 869-882, Doi:10.1111/1540-5885.2010.00757.
[25] Smith, W., Binns, A., Tushman, M., Complex business models: Managing strategic paradoxes simultaneously. Long range planning, 2010, 43, P.448-461, Doi:10.1016/2009.12.003.
[26] Schad, J., Lewis, M., Raisch, S., Smith, W, Paradox research in management science: Looking back to move forward. The Academy of Management Annals, 2016, 10(1), P. 5-64, Doi: 10.5465/19416520.2016.1162422.
[27] Lewin, A., Long, C., Carroll, T., The coevolution of new organizational forms. Organization science, 1999, 10(5), P. 535-550, Doi:10.1287/10.5.535.
[28] Andriopoulos, C., Lewis,M., Managing innovation paradoxes: ambidexterity lessons from leading product design companies. Long range planning, 2010, 43, P. 104-122. Doi:10.1016/j.lrp.2009.08.003.
[29] Jansen, J., Combining competence building and leveraging: managing paradoxes in ambidextrous organizations. Competence Perspectives on Learning and Dynamic Capabilities, 2008, 10, P. 99-119, Doi:10.1016/S0749-6826(07)10005-6.
[30] Abernathy, W., Clark, K., innovation: Mapping the winds of creative destruction. Research policy, 1985, 14, P.3-22, Doi:10.1016/0048-7333(85)90021-6.
[31] Chebbi, Y., Vrontis T., Building Multiunit Ambidextrous Organizations—A Transformative Framework, Human Resource Management, 2015, Doi: 10.1002/hrm.21662
[32] Jansen, J., Tempelaar, M., Van den Bosch, F., Volberda, H: Structural differentiation and ambidexterity: the mediating role of integration mechanisms. Organization Science, 2009, 20, P.797-811, Doi:10.1287/orsc.10 80.0415.
[33] Akdogan, S., Akdogan, A., Cingoz, A., Organizational Ambidexterity: An Empirical Examination of Organizational Factors as Antecedents of Organizational ambidexterity. Journal of Global Strategic Management, 2009, 6, P. 1-11, Doi:10.20460/JGSM.2009318458.
[34] Abderrazak, D. Bacha, S., Investor emotional biases and trading volume’s asymmetric response: A non-linear ARDL approach tested in S&P500 stock market, Journal of Financial Economics.2016, 5(1), P.21-39. Doi:10.1080/23322039.2016.1274225
[35] Utomo, D., Putro, U., Hermawan, P., Agent-Based Research Methodology for Service Science, Management and Engineering (SSME) in Industrial Cluster, The 2nd International Research Symposium in Service Management Yogyakarta, Indonesia, 2011, P.26-30.
[36] Derbyshire, J., The impact of ambidexterity on enterprise performance: Evidence from 15 countries and 14 sectors. Technovation, 2014, 34, P. 574-581, Doi:10.1016/j.technovation.2014.05.010.
[37] Izadikhah, M., M Tavana, M., Di Caprio, D., Santos-Arteaga, FJ, A novel two-stage DEA production model with freely distributed initial inputs and shared intermediate outputs, Expert Systems with Applications, 99, P. 213-230. Doi: 10.1016/j.eswa.2017.11.005
[38] Wei, Z., Zhao J., Zhang C., Organizational ambidexterity, market orientation , and firm performance. Engineering and technology Management, 2014, 33, P.134-153, Doi:10.1016/j.jengtecman.2014.06.001.
[39] Popadic, M., Cerne M., Milohnic, I., Organizational Ambidexterity, Exploration, Exploitation and Firms Innovation performance. Organizacija, 2015, 48(2), Doi:10.1515/orga-2015-0006.
Volume 4, Issue 4
October 2019
Pages 39-49
  • Receive Date: 23 July 2019
  • Revise Date: 21 October 2019
  • Accept Date: 21 October 2019
  • First Publish Date: 21 October 2019