The importance of Sustainable Supply Chain Management in Organizational Performance

Abstract

Sustainable supply chain practices offer businesses a competitive edge and foster long-term success. By incorporating sustainable supply chain management (SSCM) into their strategic framework, companies can simultaneously enhance performance while addressing social and environmental concerns. The ability to coordinate the outcomes of operations is vital for supply chains to meet new objectives, including social and environmental goals. KPIs (Key Performance Indicators) often represent a system of interrelated components, known as a "KPI system," which can serve as a quantitative tool to achieve key business objectives. However, subjective insights also play a critical role in the successful execution of a plan, alongside the quantitative tools. One significant challenge for manufacturing supply chain managers is identifying the "right" KPIs that align with their goals.

This study, the first of its kind, explores the relationship between SSCM and organizational performance (OP) in the manufacturing sector, considering the triple-bottom-line approach and the mediating role of competitive advantage. It contributes to the literature by providing empirical evidence on how SSCM impacts competitive advantage and organizational performance in manufacturing.

The research demonstrates that SSCM has a significant positive impact on both competitive advantage and organizational performance. Additionally, the statistical results confirm the connection between competitive advantage and organizational performance. Furthermore, competitive advantage is shown to indirectly influence the relationship between SSCM and organizational performance. The findings suggest that successful implementation of SSCM can enhance both competitive advantage and organizational performance