Strategic flexibility is a widely discussed concept. Yet discussions remained of qualitative nature or addressed only specific aspects quantitatively underlying the concept. The purpose of this paper is to develop a conceptual model identifying key factors determining strategic flexibility. Once quantified, the model provides firms a profile of each strategic option towards the company vision.
The paper reviews existing and synthesises prior contributions into a conceptual model of strategic flexibility. Based on semi-structured interviews and value mapping, the model is applied using three case studies from the automotive industry.
A total of three main findings were made. First, the concept of strategic flexibility has a simple logic that aligns itself to a variety of automotive companies and visions. However, underlying this remit is an interplay of variables. Previous studies remain fragmented and have only addressed a subset of variables. Second, these variables can be grouped into three dimensions of strategic flexibility – product, process and customer – to convey a holistic understanding of strategic flexibility and its key determinants. Third, due to the uncertainty and complexity involved, depending on the firm and industry characteristics, there cannot be a one-fits-all configuration of the strategic flexibility conceptualisation.
A variety of variables requires consideration to offer a balanced view of all three dimensions of strategic flexibility. Hence, the case studies remain at a necessarily high level.
The paper offers guidance for management on how to align their firm strategy to product and process contingency factors to satisfy customer needs in line with their company vision.
The paper aims to elevate a discussion that previously remained fragmented and mainly descriptive.
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