Clarifying the Role of Strategic Agility in Firms’ Capability and Performance

Agility in firms has been recognized as a strategy to succeed in highly competitive anddynamic environments. Strategic agility, not just manufacturing agility, is essential and requiredin today‘s hyper-competitive environment. This paper seeks to explore the element of ‗strategicagility‘ and the implications of having strategic agility under different levels of environmentalchange. This paper uses a Competence-Capability-Performance1 framework with the theoreticalperspectives of dynamic capability, strength of weak ties and knowledge- based view ofcompetitive advantage to explicate how a firm can implement strategies to build the requiredcompetencies to gain ‗strategic agility capability‘. Furthermore, the importance of strategicagility on operational and financial performance under various levels of environmental change isexplained.

Keywords:

Agility , Strategic agility