Report Number

1994-003

Abstract

This study develops and tests a behavioral model of organizational changes in operational flexibility. Regression results using an international data set provide strong support for the general proposition that uncertainties associated with different environmental components--poitical, government policy, macroeconomic, competitive, input and product demand uncertainties--have different implications for firm internal, locational, and supploer flexibility. Slack acts as a buffer attenuating, and often offsetting, the direct effects of uncertainties on changes in operational flexibility.

Date of this Version

1-1-1994

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