alog photography but hasn't been able to make the leap to digital cameras. Boeing, a longtime leader in commercial aircraft, has experienced difficulties in its defense-contracting businesses and has recently stumbled in the face oThe Roman god Janus had two sets of eyes – one pair focusing on what lay behind, the other on what lay ahead. General Managers and corporate executives should be able to relate. They, too, must constantly look backward, attending to the products and processes of the past, while also gazing forward, preparing for the innovations that will define the future.

This mental balancing act can be one of the toughest of all managerial challenges – it requires executives to explore new opportunities even as they work diligently to exploit existing capabilities – and it's no surprise that few companies do it well. Most successful enterprises are adept at refining their current offerings, but they falter when it comes to pioneering radically new products and services. Kodak and Boeing are just two of the more recent examples of once dominant companies that have failed to adapt to market changes. Kodak excelled at analog photography but hasn't been able to make the leap to digital cameras. Boeing, a longtime leader in commercial aircraft, has experienced difficulties in its defense-contracting businesses and has recently stumbled in the face o

to the products and processes of the past, while also gazing forward, preparing for the innovations that will define the future.

This mental balancing act can be one of the toughest of all managerial challenges – it requires executives to explore new opportunities even as they work diligently to exploit existing capabilities – and it's no surprise that few companies do it well. Most successful enterprises are adept at refining their current offerings, but they falter when it comes to pioneering radically new products and services. Kodak and Boeing are just two of the more recent examples of once dominant companies that have failed to adapt to market changes. Kodak excelled at analog photography but hasn't been able to make the leap to digital cameras. Boeing, a longtime leader in commercial aircraft, has experienced difficulties in its defense-contracting businesses and has recently stumbled in the face o

xecutives to explore new opportunities even as they work diligently to exploit existing capabilities – and it's no surprise that few companies do it well. Most successful enterprises are adept at refining their current offerings, but they falter when it comes to pioneering radically new products and services. Kodak and Boeing are just two of the more recent examples of once dominant companies that have failed to adapt to market changes. Kodak excelled at analog photography but hasn't been able to make the leap to digital cameras. Boeing, a longtime leader in commercial aircraft, has experienced difficulties in its defense-contracting businesses and has recently stumbled in the face out they falter when it comes to pioneering radically new products and services. Kodak and Boeing are just two of the more recent examples of once dominant companies that have failed to adapt to market changes. Kodak excelled at analog photography but hasn't been able to make the leap to digital cameras. Boeing, a longtime leader in commercial aircraft, has experienced difficulties in its defense-contracting businesses and has recently stumbled in the face oalog photography but hasn't been able to make the leap to digital cameras. Boeing, a longtime leader in commercial aircraft, has experienced difficulties in its defense-contracting businesses and has recently stumbled in the face of competition from Airbus.

The failure to achieve breakthrough innovations while also making steady improvements to an existing business is so commonplace – and so fascinating – that it has become a battleground of management thought. For decades, scholars have spun theories to explain the puzzle and offered advice on how to solve it. Some have argued that there's no way out of the conundrum – that established companies simply lack the flexibility to explore new territory. Some have suggested that big companies adopt a venture capital model, funding exploratory expeditions but otherwise staying out of their way. Others have pointed to cross-functional teams as the key to creating breakthrough innovations. Still others have claimed that a company may be able to shift back and forth between different organizational models, focusing on exploitation for a period and then moving into exploration mode.

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