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Department of industrial management, Faculty of Economics and Management, Islamic Azad University Shiraz Branch,
Shiraz, Iran,
*
Islamic Azad University Yasooj Branch, Yasooj, Iran
armanedu2017@gmail.com
aziziiman93@yahoo.com
Abstract- This study was conducted to investigate the effect observing environmental laws and standards, increasing
of green supply chain management on green performance customer knowledge in this area, and reducing the
and firm competitiveness in Shiraz Industrial Estate. Data negative environmental effects of their products and
were collected from 110 executives and managers in services [13]. Green performance involves assessing the
companies on the Estate using a pre-designed questionnaire.
relationship between trade and the environment [17].
A descriptive, correlational methodology was adopted Data
Sustainable development is key to ensuring a company’s
were analysed using structural equation modeling and
partial least squares (PLS) path analysis. The results showed
survival and requires the commitment and participation of
that: the internal green practices of a company have a all employees and managers. Companies are faced with
positive and significant impact on external green competitive pressure to coordinate and cooperate through
collaboration; internal green practices and external green the supply chain and to improve agility, flexibility and
collaboration have a positive and significant impact on the proper functioning. At the same time, increased concern
company's green performance; and internal green practices, about environmental issues is driving companies to adopt
external green collaboration and the company's green green supply chain management strategies that maintain
performance have a positive and significant effect on firm
competitiveness [22].
competitiveness. Overall, the results suggest that
strengthening green supply chain management improves A green supply chain is an opportunity for sustainable
green performance, which in turn increases firm
consumption and environmentally friendly business
competitiveness. Most prior researches have either
operations. From a macro perspective, attention to green
concentrated on particular issues related to internal green
practices or external green cooperation. This study brought issues is important in relation to both the design of new
into account papers both from internal and external green green products and the creation of markets for products
supply chain practices in order to elucidate the impact of that are compatible with the environment. The creation of
green performance and practices on firm competitiveness. a green supply chain requires the development of
opportunities for companies to invest in the design and
Keywords: green supply chain management, internal green manufacture of greener products and to meet the
practices, external green collaboration, company's green requirements of sustainability. It involves not only the
performance, competitive advantage. production of green consumer goods, but also the
involvement of suppliers in the creation of green markets
[21].
1. Introduction
This study sought to investigate the role of internal green
International organizations are always seeking to gain practices and external green collaboration on green
competitive advantage through innovation. In some cases, performance and firm competitiveness. Internal green
this takes the form of improving green performance by practice recognizes that different administrative areas
within the company need to be integrated for optimum
______________________________________________________________ performance [6]. External green collaboration involves
International Journal of Supply Chain Management
IJSCM, ISSN: 2050-7399 (Online), 2051-3771 (Print) mutual understanding of environmental responsibilities
Copyright © ExcelingTech Pub, UK (http://excelingtech.co.uk/) and risks and shared decision-making to solve
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Int. J Sup. Chain. Mgt Vol. 6, No. 4, December 2017
environmental problems and allocate resources, skills and competitiveness. The present study addresses this gap. It
knowledge between suppliers, partners and customers in had two main aims: (1) To make more explicit the impact
the supply chain to achieve common environmental goals of green practices on organizational performance; and (2)
[29]. To analyze the effect of internal green practices and
external green collaboration on firm competitiveness.
To date, research in the field of green supply chain
management has failed to investigate the effect of green
supply chain management on green performance and firm
External H5(+)
green
collaboration
As shown in Figure 1, six testable hypotheses were obtained from external suppliers, partners and customers
identified. All of the direct associations indicated are and acknowledging their business interests [2]-[10]-[14]-
hypothesised as positive. The theorised structural model [27]. From the perspective of strategic partnership, if
incorporates green performance as the focal construct with people in various operating units in the company do not
internal green practices and external green collaboration interact with each other to integrate their objectives and
as antecedents and firm competitiveness as a consequence. activities [25]-[26], the company is unlikely to achieve a
The model illustrates both direct and indirect associations high degree of integration with its external customers and
among the study constructs. The model is designed to suppliers [12]. Hypothesis one follows from this
assess the impact of green supply chain indicators on firm theoretical justification:
competitiveness. We theorise that the combination of
internal green practices and external green collaboration H1: Internal green practice has a significant impact on
will enhance green performance, ultimately improving external green collaboration.
firm competitiveness.
Many previous studies have illustrated the impact of
Most previous studies had suggested that companies cross-functional and cross-organisational performance on
should achieve cooperation between internal processes to firm performance Ref. [4]-[16]-[20]-[25]-[31] and derived
a relatively high degree before initiating external that there is a positive relationship between internal
integration[24]. Internal integration removes key barriers performance and operational performance. Stank, Keller,
and creates cooperation to meet customer needs rather & Daugherty [23] and Ellinger et al. [5] found that
than reflecting traditional administrative divisions and collaboration between marketing and logistics had a
specializations [6]. When a company has a high level of positive effect on distribution services performance. Zhu
internal communication and coordination, it can accelerate and Sarkis [32] proposed that companies with high levels
its external integration by utlising new knowledge of adaptation of green activity achieve improved
environmental performance. Hence there is considerable
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Int. J Sup. Chain. Mgt Vol. 6, No. 4, December 2017
evidence to support the hypothesis that the Recently, environmental or green considerations have
implementation of internal green practices will lead to appeared as sources of competition [11]-[19]. Successful
improved green performance. Based on this evidence we environmental management can improve corporate
hypothesise that: structure Ref.[9] and provide new opportunities for
companies to strengthen their capabilities and facilities
H2: Internal green practice has a significant impact on [8]. Bacallan [1] showed that organisations can strengthen
the company's green performance. their position in a competitive environment by improving
their green performance to be consistent with
Green activities and integration have potential strategic
environmental regulations. Integration of environmental
value because they affect the value chain in multiple areas,
concerns into management activities can greatly assist
producing unique benefits at each level of the supply
companies to achieve competitive advantages [15]. Based
chain [19]. Similarly, there should be a variety of
on this theoretical justification, hypothesis six is as
measures of competitive performance which, as much as
follows:
possible, provide a holistic approach to the environmental
infiltrations on the firm's economic performance. H6: A company's green performance has a significant
Hypothesis three is, therefore, that: impact on its competitiveness.
Table 1
Cronbach's Alpha Coefficients and Composite Reliability, Average Variance and Factor Loading
Factor Factor
Indicators Variable Indicators Variable
Loading Loading
Green
External Green Green Internal Green
0.99 Collaboration 0.92
Collaboration Policy Practices
With Suppliers
Green Green Alpha
Alpha Coefficient:
0.92 Collaboration 0.91 Shipping Coefficient:
0.91
With Partners Practices 0.94
Green
Composite Composite
Collaboration Green
0.92 Reliability: 0.92 Reliability:
With Marketing
0.92 0.94
Customers
Average
Average Variance:
Variance:
0.90
0.84
Reduction
Quality Of Firm Green
0.88 0.93 Of
Service Competitiveness Performance
Pollutants
Alpha
Alpha Coefficient: Decrease In
0.91 Productivity 0.94 Coefficient:
0.90 Green Costs
0.86
Composite
Corporate Composite
0.94 Reliability:
Profits Reliability: 0.93
0.93
Average
Average Variance:
Variance:
0.83 0.88
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Int. J Sup. Chain. Mgt Vol. 6, No. 4, December 2017
In relation to convergent validity, the extracted average The square root of average variance for the main variables
variance was examined with respect to the amount of the of the study in the main diagonal matrix was larger than
extracted average variance for all variables. This was the correlation between variables in the boxes of the
larger than 0.55 so convergent validity of the model was lower-left
left diagonal. Thus it can be stated that the study
confirmed. variables in the model had more interaction with their
indices than with indices of other variables; hence the
Divergent validity was examined using the method of divergent validity of the model was confirmed.
Fornell and Larcker [7]. As shown in Table 22, this
involves first calculating the square root of amounts of
AVE (average variance) and then replacing the obtained
values on the diagonal matrix (latent variable
iable correlation).
Table 2
Matrix Assessing Divergent Validity Following Fornell & Larcker [7] (Latent Variable Correlations)
Table 3:
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