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Balancing exploration and exploitation in complex environments

Anca Bocanet (University of Naples Federico II – Department of Business and Managerial Engineering, Naples, Italy)
Cristina Ponsiglione (University of Naples Federico II – Department of Business and Managerial Engineering, Naples, Italy)


ISSN: 0305-5728

Article publication date: 10 February 2012




The objective of this study is to model and analyze the exploration‐exploitation dynamics of March's model of mutual learning in a complex environment. By enhancing the above mentioned model, the paper seeks to propose a new agent‐based model of mutual learning within an organization.


The paper replicates March's model of simulating learning within an organization using an agent‐based simulation approach, and extends it by modelling the problem space as a fitness landscape using Kauffman's NK model technique.


It was found that it is impossible to find a right balance between exploration and exploitation using the communication structure of March's model.

Practical implications

The proposed model could help create a virtual laboratory for experimenting organizations' behavior in a complex co‐evolving environment. This virtual laboratory may be used in the future to support the decision‐making process of managers and policy makers.


Designing the external environment as a fitness landscape helps in discovering what effect the environmental complexity has on the emerging balance between exploration and exploitation. It is the first study to design the environment of a model which analyzes the mutual learning between an organization and its members as a complex non‐linear space.



Bocanet, A. and Ponsiglione, C. (2012), "Balancing exploration and exploitation in complex environments", VINE, Vol. 42 No. 1, pp. 15-35.



Emerald Group Publishing Limited

Copyright © 2012, Emerald Group Publishing Limited

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