Recognizing the ideal patterns of strategic flexibility, IT strategy and business performance: a cluster analysis approach

Purpose - In spite of intensive research that explained the strategic flexibility-performance and information technology (IT) strategy-performance relationships, there is a little insight regarding how these notions ideally affect business performance. Accordingly, this study attempts to investigate how businesses can translate IT directions and strategic practices into actual increases in business performance. More precisely, the primary purpose of this paper is to explore the influential role of strategic flexibility and IT strategy on business performance considering balanced scorecard (BSC) dimensions in the context of the tourism industry. Design/methodology/approach - An empirical investigation of 331 tourism businesses was performed to explore the relationship between strategic flexibility, IT strategy and business performance. A non-probability convenience sampling was applied to select the sample. Factor analysis, descriptive statistics and cluster analysis were used to analyze the data. Findings - The findings include the clustering of the studied businesses in terms of strategic flexibility and IT strategy. A cluster analysis based on strategic flexibility indicates that businesses can be divided into four main clusters, and based on IT strategy, they can be classified in three main clusters. The results show that businesses with a high level of strategic flexibility and a high level of IT strategic practices have high performance. More importantly, it was known that proactiveness and strategic use of IT have more predictor role on performance. Originality/value - A review of the strategic management literature reveals a lack of empirical studies that adequately explore the significant roles of strategic flexibility and IT strategy on business performance in the tourism industry. This paper provides actionable insights into these two main determinants that explain why some tourism businesses outperform others. The primary contribution of this study is to address the gap in our understanding of the interconnections between strategic flexibility, IT strategy and business performance through cluster analysis in the tourism industry.