Predicting SMEs performance through green supply chain practices: a mediation model link of business process performance

Abstract

PurposeBecause of the emergence of technological development, firms (i.e. small and medium enterprises (SMEs)) adopt innovative cost-reduction strategies to improve their processes. Therefore, the adoption of green supply chain practices (GSCP) is critical for SMEs to enhance their business process performance (BPP). This paper aims to investigate how GSCP directly and indirectly (via BPP) influences firm manufacturing performance using the resource-based view as a theoretical base. This research also pursues to examine the mediation mechanism of BPP in the linkage between GSCP and SMEs performance in manufacturing SMEs.Design/methodology/approachUsing the survey method, the authors recruited 407 textile SMEs executives and validated the proposed model and relationships in AMOS.FindingsThe outcomes confirm that GSCPs are positively related to BPP and SME performance, and BPP significantly mediates the association between GSCP and SME performance.Practical implicationsThe outcomes help SME executives to minimize operational costs, save time and reduce wastage by implementing GSCP in their manufacturing processes. SME executives can improve their internal business processes for attaining the best firm performance.Social implicationsThis research provides a healthy workplace to employees by improving business processes performance, enhancing brand image, increasing employee morale and decreasing production wastage.Originality/valueThis research theoretically and empirically contributes to explore the impact of GSCP on textile SME performance, which was unexplored in strategic green supply chain and performance management literature. Furthermore, this is the first study that explores the mediation mechanism of BPP between GSCP and SMEs performance.