Examining Environmental Turbulence Intensity: A Strategic Agility and Innovativeness Approach on Firm Performance in Environmental Turbulence Situations

Abstract

Environmental turbulence refers to the unpredictable changes, developments, and uncertainties in a firm’s external environment. Environmental turbulence consists of market turbulence, technological turbulence, and competition intensity. It causes a shortening of firms’ product life cycles, changes in customer demands, and rapid technological developments. Companies do not control the changes in their external environment. In addition, they cannot manage change by using traditional methods where environmental factors are constantly changing. Thus, environmental turbulence and strategic plans might be reconsidered in today’s business world. This article examines the intensity of environmental turbulence from the strategic agility and innovativeness perspective. The study was conducted using data from Turkey, including medium-high or high technology firms that were located in a technopark or had an R&D center. The survey method was used to collect data for the study and the SPSS Process macro was used to analyze the effects of moderator variables on the relationship between strategic agility and firm innovativeness. Findings indicate that strategic agility positively affects firm innovativeness and that this effect might decrease due to increases in turbulence intensity. Moreover, firm innovativeness positively affects performance, and this effect becomes more robust with increases in turbulence intensity. This study provides practical implications for companies and researchers depending on environmental turbulence diversity.