We examine the relationships between CEO personality, strategic flexibility (ability to adapt quickly to environmental changes), and firm performance, using a sample of 195 small and medium-sized firms from the Indian business process outsourcing industry. We hypothesize that strategic flexibility mediates the relationships between CEO personality and firm performance. Our results extend previous research by not only highlighting the importance of CEO personality in driving strategic flexibility, but also indicating how each facet of CEO personality either enhances or inhibits strategic flexibility.
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Nadkarni et al. (2010) studied this question.
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