Strategic Sustainability and Operational Initiatives in Small- and Medium-Sized Manufacturers: An Empirical Analysis

Abstract

We explored the moderating impacts of product modularity and supply chain visibility for sustainability and operational initiatives, which entails a dramatic rethinking and reorganization of the production processes of manufacturing enterprises. Moderating effects of product modularity and supply chain visibility on links among supply chain pressure, technological pressure, sustainable practices, operational performance, and sustainability performance were included. A conceptual model was developed following the resource-based view and dynamic capability theories. Well-designed questionnaires collected data, and the total sample size for data analysis was 490 responses from small- and medium-sized manufacturing firms in Pakistan. Structural equation modeling was used to examine the proposed hypothesis. The first finding revealed that operational performance and sustainable performance both improve when companies implement sustainable practices. The second finding drawn from the data was that supply chain pressure and technological pressure have a positive effect on sustainable practices. The major finding of this work was grounded in the product modularity perspective, we argue that the relations among supply chain pressure, technological pressure, sustainable practices, operational performance, and sustainability performance are affected and moderated. The moderating effect of supply chain visibility existed and it has a positive moderating effect for the relationships from sustainable practices toward operational and sustainability performance. Surprisingly, moderating impact of visibility on relations from supply chain pressure and technological pressure towards sustainable practices was not significant.