How firms scan and interpret their environments has implications for the flexibility strategy that they choose, as well as for the performance of that strategy. We extend Daft and Weick's (Acad Manage Rev 9(2):284-295, 1984) model of firms as interpretation systems into a theoretical model of flexibility performance through extended iterations between observations of a failed flexibility initiative and relevant literature. We test the model using well-known teaching cases. We argue that the use of an iterative process that involves cases and theory both stimulates creativity in integrating theory and lays an initial foundation for evidence-based practice.