Empowering Clusters: How Dynamic Capabilities Drive Sustainable Supply Chain Clusters in Egypt

Abstract

Drawing on systems theory, the extended resource-based view and dynamic capability theory, this research develops an integrated framework to offer a more nuanced understanding of the mediating role of dynamic capabilities between supply chain cluster design characteristics and economic, social and environmental sustainability. Data were collected from organisations in Egypt through a questionnaire survey and were analysed using structural equation modelling. Based on 811 responses, a multi-mediation model analysis using Smart-PLS recognises that geographical concentration, networked collaboration and supporting services systems are critical supply chain cluster design characteristics that offer a pool of resources and collective knowledge that help organisations build absorptive capacity and resilience, which, in turn, help in protecting, reconfiguring and developing the shared resources to achieve high levels of environmental, social and economic sustainability. The findings affirm that supply chain clusters can be used as a tool to maintain desired sustainability levels in a dynamic business environment as it will allow organisations to cope with sudden changes in the market quickly and efficiently. This will allow organisations to improve sustainability performance by developing their dynamic capabilities with enhanced supporting services and network collaboration, thereby adequately exploiting external knowledge and opportunities, as well as effectively mitigating business vulnerability. This will also help in extending the three theoretical lenses through contextualising their abstract ideas in a supply chain cluster context and analyse data from a developing market. This is particularly important as further investigation is needed regarding supply chain clusters and the relationship between dynamic capabilities and sustainability in different contexts, especially since previous studies focused on developed economies and did not use the combination of these variables.