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Driving forces for industry 4.0 readiness, sustainable manufacturing practices and circular economy capabilities: does firm size matter?

Purpose: Despite just eight years remaining to meet the sustainable development goals (SDG, 2030), the manufacturing industry faces numerous challenges for small and medium-sized enterprises (SMEs). Some notable challenges include integrating sustainability, circular economy (CE), and industry 4.0 (...

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Main Authors: Ali, K., Johl, S.K.
Format: Article
Published: Emerald Publishing 2023
Online Access:http://scholars.utp.edu.my/id/eprint/37479/
https://www.scopus.com/inward/record.uri?eid=2-s2.0-85159483088&doi=10.1108%2fJMTM-07-2022-0254&partnerID=40&md5=ec9d858a614ccfa199a69daa9e192e3e
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spelling oai:scholars.utp.edu.my:374792023-10-04T13:17:59Z http://scholars.utp.edu.my/id/eprint/37479/ Driving forces for industry 4.0 readiness, sustainable manufacturing practices and circular economy capabilities: does firm size matter? Ali, K. Johl, S.K. Purpose: Despite just eight years remaining to meet the sustainable development goals (SDG, 2030), the manufacturing industry faces numerous challenges for small and medium-sized enterprises (SMEs). Some notable challenges include integrating sustainability, circular economy (CE), and industry 4.0 (I4.0) technologies in a productive manner. However, there is a paucity of evidence available on the role of institutional pressures and organizational resources to promote I4.0 and sustainability. To fill this void, this study develops and tests a model based on institutional theory and resource-based view (RBV) theory while also taking company size into view as a moderating construct. Design/methodology/approach: To test the study hypotheses and validate the model, data were obtained through a survey from 228 randomly selected SMEs manufacturing in China. Structured equation modeling and multigroup analysis were used to analyze the data. Findings: The research findings indicate that institutional pressure has a positive effect on organizational resources (i.e., tangible and intangible), which are capable of orchestrating I4.0 readiness effectively. Also, I4.0 readiness has a positive effect on sustainable manufacturing practices and CE capabilities. Finally, firm size was revealed to be a significant moderator in driving overall integration. Practical implications: Based on the findings, practical implications and future research directions are discussed. Originality/value: Based on the institutional and RBV theories, this research shows how SMEs could be influenced by different stakeholders to acquire and develop their resources and capabilities to accelerate I4.0 readiness that further enhances sustainable practices. © 2023, Emerald Publishing Limited. Emerald Publishing 2023 Article NonPeerReviewed Ali, K. and Johl, S.K. (2023) Driving forces for industry 4.0 readiness, sustainable manufacturing practices and circular economy capabilities: does firm size matter? Journal of Manufacturing Technology Management, 34 (5). pp. 838-871. ISSN 1741038X https://www.scopus.com/inward/record.uri?eid=2-s2.0-85159483088&doi=10.1108%2fJMTM-07-2022-0254&partnerID=40&md5=ec9d858a614ccfa199a69daa9e192e3e 10.1108/JMTM-07-2022-0254 10.1108/JMTM-07-2022-0254 10.1108/JMTM-07-2022-0254
institution Universiti Teknologi Petronas
building UTP Resource Centre
collection Institutional Repository
continent Asia
country Malaysia
content_provider Universiti Teknologi Petronas
content_source UTP Institutional Repository
url_provider http://eprints.utp.edu.my/
description Purpose: Despite just eight years remaining to meet the sustainable development goals (SDG, 2030), the manufacturing industry faces numerous challenges for small and medium-sized enterprises (SMEs). Some notable challenges include integrating sustainability, circular economy (CE), and industry 4.0 (I4.0) technologies in a productive manner. However, there is a paucity of evidence available on the role of institutional pressures and organizational resources to promote I4.0 and sustainability. To fill this void, this study develops and tests a model based on institutional theory and resource-based view (RBV) theory while also taking company size into view as a moderating construct. Design/methodology/approach: To test the study hypotheses and validate the model, data were obtained through a survey from 228 randomly selected SMEs manufacturing in China. Structured equation modeling and multigroup analysis were used to analyze the data. Findings: The research findings indicate that institutional pressure has a positive effect on organizational resources (i.e., tangible and intangible), which are capable of orchestrating I4.0 readiness effectively. Also, I4.0 readiness has a positive effect on sustainable manufacturing practices and CE capabilities. Finally, firm size was revealed to be a significant moderator in driving overall integration. Practical implications: Based on the findings, practical implications and future research directions are discussed. Originality/value: Based on the institutional and RBV theories, this research shows how SMEs could be influenced by different stakeholders to acquire and develop their resources and capabilities to accelerate I4.0 readiness that further enhances sustainable practices. © 2023, Emerald Publishing Limited.
format Article
author Ali, K.
Johl, S.K.
spellingShingle Ali, K.
Johl, S.K.
Driving forces for industry 4.0 readiness, sustainable manufacturing practices and circular economy capabilities: does firm size matter?
author_facet Ali, K.
Johl, S.K.
author_sort Ali, K.
title Driving forces for industry 4.0 readiness, sustainable manufacturing practices and circular economy capabilities: does firm size matter?
title_short Driving forces for industry 4.0 readiness, sustainable manufacturing practices and circular economy capabilities: does firm size matter?
title_full Driving forces for industry 4.0 readiness, sustainable manufacturing practices and circular economy capabilities: does firm size matter?
title_fullStr Driving forces for industry 4.0 readiness, sustainable manufacturing practices and circular economy capabilities: does firm size matter?
title_full_unstemmed Driving forces for industry 4.0 readiness, sustainable manufacturing practices and circular economy capabilities: does firm size matter?
title_sort driving forces for industry 4.0â readiness, sustainable manufacturing practices andâ circular economy capabilities: doesâ firm size matter?
publisher Emerald Publishing
publishDate 2023
url http://scholars.utp.edu.my/id/eprint/37479/
https://www.scopus.com/inward/record.uri?eid=2-s2.0-85159483088&doi=10.1108%2fJMTM-07-2022-0254&partnerID=40&md5=ec9d858a614ccfa199a69daa9e192e3e
_version_ 1779441389609680896
score 13.223943

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