Re-exploring the Relationship Between Flexibility and the External Environment

The organizational structure literature has long posited that increases in uncertainty should lead to organic (adaptable) structures (e.g., Burnes and Stalker, 1961). Similarly, the operations management literature has focused on the importance of flexibility as a competitive weapon (e.g., De Meyer, Nakane, Miller and Ferdows, 1989), and as a response to environmental uncertainty (Swamidass and Newell, 1987; Gerwin, 1993). However, recent attempts to empirically validate a relationship between environmental uncertainty and operational flexibility in manufacturing plants have failed to show a significant relationship (Pagell and Krause, 1999). This research attempts to rectify these contradictory findings by replicating and extending the works of Swamidass and Newell (1987) as well as Pagell and Krause (1999). The results find no support for the proposition that firms that respond to increased uncertainty with increased flexibility will experience increased performance.