Expanding strategic flexibility through organizational culture, industry 4.0 and market orientation

Abstract

PurposeThe purpose of this study is to build a theory on management investigating the relationship between organizational culture and strategic flexibility in firms, and how this relationship is affected through industry 4.0 capabilities and the market orientation of firms.Design/methodology/approachAs a methodological approach, this paper uses a rich combination of literature review and exploratory interviews with managers and academics. Data were collected from 379 industrial managers; confirmatory factor analysis (CFA) and finally structural equation modeling (SEM) were performed to validate the data and examine the hypothesized relationships.FindingsThe results show that organizational culture drives firms to strategic flexibility, but the introduction of industry 4.0 capabilities and market orientation fully mediate this relationship, revealing their significance to strategic flexibility.Research limitations/implicationsAll the respondents of the study's dataset were from Greek firms; the role of national culture should be considered. Moreover, the comprehension of I4.0 is a quite recent concept that is still being formulated, this feature may modify the results of future studies.Practical implicationsManagers should allocate resources for the concurrent adoption of digital technologies capabilities and suitable market-oriented strategies in order for them to be key drivers for enhanced strategic flexibility.Originality/valueThe current state of knowledge of both theory and practise for critical organizational factors such as organizational culture, strategic flexibility, industry 4.0 capabilities and market orientation will be extended.