Knowledge creation, turbulence, and manufacturing flexibility roles in business performance and operations performance

This study examines the impact of knowledge creation, technological turbulence, and manufacturing flexibility on business performance and operations performance (time, cost, quality) in manufacturing firms. The contribution is to establish manufacturing flexibility as a mediator of the relationships of knowledge creation and technological turbulence with business and operations performance. Using a sample of 370 manufacturing firms, the study finds that knowledge creation positively affects business performance and operations performance directly and indirectly through manufacturing flexibility. Furthermore, the relationships between technological turbulence along with business and operations performance are mediated by manufacturing flexibility. The study also reveals that the relationship between manufacturing flexibility and operations performance is contingent on the level of market turbulence. The effect of manufacturing flexibility on operations performance is stronger under high market turbulence than under low market turbulence. Results suggest that: (a) firms can reinforce manufacturing flexibility in order to perform better under higher market turbulence conditions; and (b) firms can improve manufacturing flexibility by fostering knowledge creation and using technological turbulence as an incentive