Interrelationship of culture, labor flexibility, strategic alignment, innovation and firm performance

The objectives of this research are to understand the relationships between the organizational practices related to alignment strategies (AE), organizational culture (CO), innovation initiatives (INN), and flexible labor practices (PFL), with the perceived firm’s performance from the worker’s perspective. To achieve these goals, we use a quantitative analysis with a sample of 98 people working on a firm with more than 500 employees. We define firm’s performance using five alternative definitions: Creativity and initiatives (IC), goals achieved (OA), workers’ satisfaction (ST), fast workers’ advance (EO), and resources’ efficient use (AR).Preliminary results indicate that CO and AE positively affect firm’s performance under the five alternative definitions used. However, INN and PFL have asymmetric effects in firm’s performance, which are sensitive to the firm’s performance definition used. Particularly, firms face a tradeoff between performance objectives selection and the organizational flexible processes they pursue. In summary, innovation processes and flexible labor practices work in opposite directions in pursuing the firm’s goals achievement, and consequently do not lead to the development of a unidirectional development of a sustainable competitive advantage.