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To purchase or authenticate to the full-text of this article, please visit this link: http://dx.doi.org/10.1111/j.1467-8551.2007.00547.x Byline: Victor J. Garcia-Morales ([dagger][double dagger]), Francisco Javier Llorens-Montes ([dagger][double dagger]), Antonio J. Verdu-Jover ([dagger][double dagger]) Abstract: Today's information and knowledge society requires new leaders who can confront a reality based on knowledge and foster innovation to achieve improvements in organizational performance. However, organizations sometimes fail to achieve sustainable competitive advantage due to their limited understanding of the relationships between these strategic variables. To date, very little research has analysed the direct and indirect relationships between these variables. Our study seeks to fill this research gap by analysing theoretically and empirically how the leader's perceptions of different intermediate strategic variables related to knowledge (knowledge slack, absorptive capacity, tacitness, organizational learning) and innovation influence the relation between transformational leadership and organizational performance. Based on the literature, we develop a theoretical model that shows the interrelations between these variables. We then test the model using data from 408 Spanish organizations, discuss the findings and provide several implications for business practitioners. Author Affiliation: ([dagger])Faculty of Economics and Business, University of Granada, Campus Cartuja, s/n, Granada 18071, Spain ([double dagger])Faculty of Social and Juridical Sciences, University Miguel Hernandez, Edificio La Galia, Avda del Ferrocarril, s/n, Elche (Alicante) 03202, SpainEmails:fllorens@ugr.es;victorj@ugr.es;ajverdu@umh.es

This paper takes a wide-ranging transnational look, within the frame of the European Union, at the differences between large and small firms based on practices of flexibility. More specifically, the research aims to evaluate whether small firms form a homogeneous body in applying flexible practices as opposed to large firms, as well as observing the differential effects on performance when there are discrepancies in the coalignment levels between a firm’s actual flexibility and that required by the environment. The hypotheses are tested using data from 417 European firms. The results reveal that (1) good coalignments between actual and required flexibility (flexibility fit) have a greater influence on business performance in the case of small firms; (2) there are significant differences between small and large firms as regards operative flexibility, strategic flexibility, financial flexibility (organizational slack), and performance. The large firms analyzed coalign their flexibility fit better in their various dimensions (structural, operative, and strategic); (3) the degree of metaflexibility can be greater among small firms, which represents a greater information processing capacity, thus enabling the flexibility fit to be constantly coaligned to changes in the environment. However, a greater metaflexibility is not immediately reflected in the flexibility fit; and (4) this greater flexibility fit among large firms can be favored by their greater financial flexibility. [ABSTRACT FROM AUTHOR]