| Despite the increasing acknowledgment of the criticality of strategic flexibility in the new competitive landscape characterized by technological advances, knowledge and especially globalization, little research exists that examines the major catalyst for firm strategic flexibility and the performance consequences of strategic flexibility. The research that does exist has mostly been piecemeal focusing on particular strategies as a way for firms to achieve more strategic flexibility (e.g., joint ventures).; This study proposes that the flexibility of the CEO and top management team (i.e., executive flexibility) is an important antecedent for the strategic flexibility of firms. After developing a theory of executive flexibility, this study proposes and tests various links among CEO and TMT characteristics, executive flexibility, and firm strategic flexibility. Specifically, we test (1) The main effect of CEO tenure, TMT job-related diversity, and TMT international exposure on the strategic flexibility of the firm, (2) the moderating role of behavioral integration on the relationship between TMT characteristics (i.e., TMT job-related diversity, TMT international exposure) and the strategic flexibility of the firm, (3) the impact of firm strategic flexibility on firm performance, and (4) the moderating role of environmental volatility on the relationship between firm strategic flexibility and performance.; Based on a sample of 263 firms in fourteen industries, we find that CEO and TMT characteristics are indeed important antecedents to the strategic flexibility of the firm. More specifically, our results show that CEO tenure has a curvilinear relationship with firm strategic flexibility and that TMT job-related diversity is positively related to firm strategic flexibility. In addition, behavioral integration moderates the relationship between job-related diversity and the strategic flexibility of the firm.; With regard to the performance consequences of firm strategic flexibility, we find that firm strategic flexibility is positively related to firm performance. Moreover, the degree of volatility in the environment was found to moderate the relationship between firm strategic flexibility and performance.; This study extends the upper-echelons research to provide new insight into CEO and TMT characteristics that impact the strategic flexibility of the firm. The implications of our findings as well as future research areas will also be suggested. |
