Involving second-tier suppliers in Green supply chain management: drivers and heterogenous understandings by firms along supply chains

Abstract

Leading manufacturers have struggled to extend their green supply chain management (GSCM) efforts to low-tier (the second- and even lower-tier) suppliers, but how to motivate low-tier suppliers to be involved is still a big challenge. This paper develops a low-tier GSCM model for managing second-tier suppliers. Based on stakeholder theory and literature review, this paper develops 25 drivers for the ìnvolvement of second-tier suppliers in low-tier GSCM by a manufacturer. Using data collected from 29 second-tier suppliers of a leading automobile manufacturer, this study identified 17 critical drivers. The Grey-DEMATEL method was used to examine the cause-effect relationships to reveal prominent and elemental drivers. Based on the evaluation by managers from the manufacturer, one first-tier supplier, and six second-tier suppliers, comparative analysis of the DEMATEL results show that the manufacturer understands the prominent role of second-tier suppliers for its low-tier GSCM implementation while second-tier suppliers know little about the manufacturer’s requirements and the first-tier supplier ignores the importance of internal drivers by second-tier suppliers. In the long term, the manufacturer considers itself as the crucial firm for low-tier GSCM, but according to first- and second-tier suppliers, promoting policies by the government such as GSCM-related demonstration projects are also elemental. This study provides directions for multi-tier GSCM studies on the theoretical development about how to effectively involve second-tier suppliers by unveiling the difference in the understanding of drivers among firms along supply chains.