J. Eng. Technol. Manage.

29 (2012) 168–185

Contents lists available at SciVerse ScienceDirect

Journal of Engineering and

Technology Management
journal homepage: www.elsevier.com/locate/jengtecman

Green supply chain management innovation diffusion

and its relationship to organizational improvement:
An ecological modernization perspective
Qinghua Zhu a,*, Joseph Sarkis b, Kee-hung Lai c
a
School of Bussiness, Dalian University of Technology, Dalian, Liaoning Province 116024, China
b
Graduate School of Management, Clark University, USA
c
Department of Logistics and Maritime Studies, The Hong Kong Polytechnic University, China

A R T I C L E I N F O A B S T R A C T

JEL classification: Drawing on diffusion of innovation and ecological modernization

Q56 theories, we identify three types of industrial manufacturers,
C12 namely early adopters, followers, and laggards, based on the
C83
adoption of green supply chain management (GSCM) practices
Keywords:
among Chinese manufacturers. Test results indicate that differences
Supply chain management
Environmental issues
exist between the three types of GSCM adopters in terms of their
Cluster analysis environmental, operational, and economic performance. Under-
Diffusion of innovation theory standing how Chinese manufacturers adopt GSCM practices and if
Empirical taxonomy this adoption affects their performance contributes theoretical
advancement to the diffusion of innovation theory. Practically, the
results provide managerial insights for manufacturers to bench-
mark for environmental management practices and performance
improvement.
ß 2011 Elsevier B.V. All rights reserved.

Introduction

Resource depletion and an increasingly detrimental environmental burden caused by organizational

production operations have led Chinese and other international regulators to impose stricter regulatory
policies. China’s Cleaner Production Promotion Law, enacted in January 2003, and China’s Circular
Economy Promotion Law, approved in August 2008 and enacted in January 2009, are two environmentally
focused regulatory policies directly affecting business. Chinese organizations are now pressured or

* Corresponding author. Tel.: +86 411 8470 6018; fax: +86 411 8470 8342.
E-mail address: zhuqh@dlut.edu.cn (Q. Zhu).

0923-4748/$ – see front matter ß 2011 Elsevier B.V. All rights reserved.
doi:10.1016/j.jengtecman.2011.09.012
 Q. Zhu et al. / Journal of Engineering and Technology Management 29 (2012) 168–185 169

encouraged to implement innovative environmental management practices such as cleaner production if

their energy and resource consumption or emission discharges do not meet international or local
requirements. In addition, organizations seeking innovative environmental management programs can
receive governmental support such as subsidies through various government programs that include
demonstration projects at national, provincial, and municipal levels. Given these regulatory policies
China’s government realizes that as a developing nation it has to maintain a precarious balance of
economic and environmental performance. As a result, manufacturing enterprises in China are pressured
and guided to help improve both their economic and environmental performance through innovative
management practices.
Ecological modernization theory (EMT), a theory for environmental innovation, has been offered as
a possible solution to the conflict between industrial development and environmental protection
(Murphy and Gouldson, 2000). Prompted by the need to gain environmental performance and
profitability which is envisaged under EMT, green supply chain management (GSCM) has become an
emerging management practice for companies who wish to gain competitiveness through
environmental innovation (Hall, 2001). In this study, we define GSCM as an emergent environmentally
sustainable organizational technological innovation,1 through integration of environmental concerns
into organizational supply chain management activities (Seuring and Müller, 2008). We argue that
EMT is a pertinent management theory to help understand and guide ecologically oriented
management innovation and change, at both the firm level and the supply chain level of analysis. The
core theoretical underpinning of EMT is that organizational technological innovation, such as GSCM,
will help organizations improve in both environmental and economic dimensions.
Drawing on EMT and linking it to the diffusion of innovation (DoI) theory at the organizational
level, we advance the proposition that different clusters of manufacturers characterized with specific
GSCM innovations do exist. This clustering scenario relates to the issue that GSCM practices seem to
diffuse from proactive manufacturers to their reactive counterparts through several stages. One
research objective in our study is to link these two theories by putting forth the supposition that EMT
advocates the benefits of adopting ecological innovations, and with support from DoI that earlier
adopters of ecological innovations will gain early adoption advantages and perform better than later
adopters. To investigate this relationship we rely on DoI, which suggests that innovation decisions
may be optional where an organization has an opportunity to adopt or reject the idea (Rogers, 1983)
and that different patterns of innovation adoption may affect firms’ outcomes. Another objective of
this study is to investigate whether there are different types of manufacturers in China based on
environmental management innovation diffusion, i.e., GSCM innovations, and, if so, how
manufacturer adoption categories are related to performance outcomes.
While studies investigating environmental management exist for developed countries (Montabon
et al., 2000; Carter and Dresner, 2001; Corbett and Klassen, 2006; Schaefer, 2007), we contribute to the
body of knowledge by investigating GSCM in a developing economy and the determination of EMT in
the patterns of the adoption of GSCM practices. The results will provide guidance to organizations
within China, or seeking to do business in China, on GSCM practices that may be worthwhile adopting.
In addition, this paper is one of the first to examine the adoption of GSCM with an integrated
framework incorporating EMT and DoI. We will determine whether differing levels of adoption
(diffusion) of GSCM practices result in differing levels of performance improvements. This finding will
help us to further elicit whether the influences of GSCM practice adoption will have similar influences
for later adopters.
To achieve our objectives, we briefly introduce EMT and DoI and how GSCM practices are
considered as innovations within these theoretical frameworks in section ‘Theoretic and proposition
development’. Based on these theoretical perspectives we proceed to put forward two general,

1
Burgess and Gules (1998) separate technology within an organization as ‘soft’ and ‘hard’. Hard technology is the traditional
technology innovation associated with hardware or software such as computerized manufacturing equipment. Soft technology
is associated with organizational innovations that may be associated with changes in organizational culture, policies and
practices such as total quality management philosophies. We believe that GSCM incorporates both these types of technologies.
We identify them as organizational technological innovations because we are focusing at the organizational (supply chain) level
of analysis as opposed to governmental policy innovations that may be typically associated with ecological modernization
theory.
170 Q. Zhu et al. / Journal of Engineering and Technology Management 29 (2012) 168–185

exploratory propositions in section ‘Theoretic and proposition development’. The research

methodology used for testing the propositions is discussed in section ‘Methodology’. In section
‘Results’, we examine the study results followed by conclusions including identified future research
directions in section ‘Conclusions and discussions’.

Theoretic and proposition development

Ecological modernization theory, diffusion of innovation theory, and GSCM

EMT posits that environmental problems may be mitigated by increasing resource efficiency,
improving sustainability, while retaining the basic system of capitalist production and consumption.
Within this situation environmental protection no longer is a ‘problem’, but an ‘opportunity’. EMT
suggests that manufacturers can overcome barriers to innovation that: prevent them from going
beyond control technologies to consider clean technologies; from complementing technological
change with organizational change; and from exploring the strategic as well as the operational
opportunities for improvement (Murphy and Gouldson, 2000). At the core of EMT is an emphasis on
‘ecologizing economy’ and ‘economizing ecology’.
In this paper GSCM is consistent with the concept of environmental innovation from the EMT view,
that is, manufacturers implement GSCM through hard (e.g., cleaner production equipment) and soft
(e.g., increased supplier collaboration in eco-design) technological innovations. The concept of GSCM
is still relatively novel (innovative) for most organizations in many industries (Lam et al., 2005; Lin and
Ho, 2008; Sarkis, 2006) and countries (Seuring and Müller, 2008; Seuring et al., 2008; Vachon and Mao,
2008). As a proactive environmental management practice, GSCM can reduce pollution to improve
organizational environmental performance, but it can also economize environmental efforts by
reducing energy and resource consumption which would lead to decreased costs and improved
financial gains. GSCM may also be helpful for improving operational performance as well through
improved efficiencies in product and process design to minimize wastes through better coordination
and cooperation with suppliers and customers. Thus, the operational improvements may occur
throughout a supply chain. Environmental innovation overall, and GSCM in particular, are especially
innovative concepts in a developing country such as China, where the focus has traditionally been on
economic growth and where only in the past decade environmental regulatory policies have started to
put emphasis on organizational environmental improvements (Lui et al., 2005; OECD, 2008). As an
organizational level technological innovation, the literature provides numerous examples of GSCM
hard and soft technological innovations contributing to organizational performance (Rennings et al.,
2006; Rehfeld et al., 2007).
GSCM can be considered as an environmental innovation from the DoI view. Since its introduction
by Rogers (1962), DoI has been widely applied to describe the patterns of innovation adoption, explain
the mechanism, and assist in predicting whether and how an innovation will be successful. Important
characteristics of an innovation include: relative advantage, compatibility, complexity, trialability,
and observability. As an emergent environmental management philosophy which incorporates supply
chain members, GSCM can be considered as a relatively advanced organizational technological
innovation for manufacturers to improve their environmental performance (Narasimhan and Carter,
1998). GSCM can be also used in parallel, and overlaps, with other current environmental innovations
such as cleaner production and environmental management systems, further indicating its
compatibility. However, GSCM is relatively complicated in comparison to other environmental
approaches since it needs to consider multiple members of a supply chain and balances the potential
costs and benefits among these members. Narasimhan and Carter (1998) asserted that GSCM should
start from simple programs and expand to other areas after accumulating experience. Such innovation
indicates the characteristic of trialability for GSCM, that is, GSCM can be trialed on a limited basis in
departmental, shopfloor, and individual relationship settings before extending to more complete and
full adoption. The literature has examined the effect of GSCM practices on performance (Geffen and
Rothenberg, 2000) and suggested that GSCM has observability, that is, the visibility of its adoption
results. Given these perspectives we can reasonably consider GSCM as an organizational technological
innovation.
 Q. Zhu et al. / Journal of Engineering and Technology Management 29 (2012) 168–185 171

DoI theory asserts that organizations pass through five stages on their way to adopting a new
practice or behavior. These stages include: knowledge, persuasion, decision, adoption, and
confirmation (Rogers, 1995). DoI also puts forward that innovation is communicated through
particular channels, over time, among the members of a social system. Hall (2001) concluded that
adoption of GSCM is dependent on environmental pressure, firm capabilities and the degree customer
firms are able to control their suppliers (a ‘sphere of influence’). He also argued that large-high-profile
firms are under greater pressure from a wide range of stakeholders to improve their environmental
performance while smaller firms are under less pressure to employ environmental management
practices. Based on an investigation of one major environmental actor in the United States (US), the US
steel industry, Clemens (2001) concluded that industry usually passes through three stages for their
environmental management practices, that is, cost minimization, cost-effective compliance, and
beneficial environmental controls. These studies and characteristics highlight the importance of DoI as
the theoretical lens to understand the adoption behavior of potential adopters and to predict the
adoption of environmental innovation such as GSCM and its performance outcomes.

A contingent ecological modernization perspective – Proposition 1

As argued, EMT provides insights into the adoption of GCSM as an innovation mechanism for
organizations to simultaneously improve their environmental, financial, and operational
performance. EMT focuses on both macro (government, nation) and micro (organizational)-level
reform, coupled with technological innovation to increase the environmental efficiency of an
economy (Mol, 2001). At a micro level of analysis, EMT is synonymous with strategic environmental
management in individual organizations (Berger et al., 2001; Holm and Stauning, 2002; Søndergård
et al., 2004; Pataki, 2005; Revell, 2007). EMT reinforces the views of management scholars who
reframe environmental problems as inefficiencies or productivity loss (Cohen, 1997; Porter and van
der Linde, 1995). EMT emphasizes the need for corporate management to recognize ecological
issues as a means of enhancing competitiveness. EMT puts heavy emphasis upon technological
advancement; the invention-innovation-diffusion of new, cleaner technologies and techniques
(Pataki, 2005).
There are immediate and long-term objectives of EMT. The former include waste reduction and
elimination, resource recovery and reuse, and dematerialization. Long-term objectives relate to
resource conservation and clean production (Mol and Sonnenfeld, 2000). As a developing country,
China highlights economic development as a priority, a policy feature since the 1980s. With economic
development comes rapid industrial modernization and substantial environmental problems. In
response to these issues, the Chinese government has been developing approaches to environmental
management, such as establishing stricter environmental regulations, promoting cleaner production
and encouraging ISO 14001 certification; using both a joint macro- and micro-economic ‘‘circular
economy’’ development policy strategy (Yuan et al., 2006). For example, cleaner production has been
encouraged in China through regulatory enforcement of Chinese manufacturers that could not meet
the required environmental standards (SEPA, 2004). Such programs extend beyond internal cleaner
production policies to the wider supply chain context and strengthen the early prevention policies in
areas such as green purchasing and eco-design. Meanwhile, the Chinese government has been seeking
to recognize proactive enterprises who implement innovative practices and acknowledge them as
demonstration projects. This approach serves as a diffusion mechanism encouraging the adoption of
environmental management practices by organizations. For those innovative organizations
recognized for their contributions to environmental protection in China, they are provided with
subsidies upon a satisfactory official assessment. The demands of economic modernization and
reduction of ecological degradation place competing demands upon Chinese manufacturing managers
who are also required to act responsively towards the environment.
The capacity of modern industrial organizations in China to recognize and respond to these
conflicting concerns depends on a number of contextual factors, e.g., firm size, history of operations,
industry types, strategic policies. Due to different internal organizational characteristics, manu-
facturers may implement innovative practices under environmental regulations at varying levels
(Sanchez and MsKingley, 1998). Thus, some organizations may be reaping the benefits of ecological
172 Q. Zhu et al. / Journal of Engineering and Technology Management 29 (2012) 168–185

modernization while others may not be according to a contingent perspective on EMT. Differing
organizational and industrial characteristics present organizations with diverse situations for
adopting environmental management practices. It is therefore expected that different types of GSCM
adopting manufacturers exist. For instance, large and medium-sized manufacturers seem to
encounter higher pressures for environmental protection (Zhu and Geng, 2001). Traditional heavy
polluters such as coal-burning power plants face strong regulatory pressures to preserve the
environment, while the automobile industry has experienced increasing pressure for environmental
protection from their foreign customers or counterparts after China’s entry into the WTO. In addition,
Chinese manufacturers with a long history of international business such as the electronic industry
tend to adopt GSCM (Zhu and Sarkis, 2006) at more extensive levels. These characteristics and
previous arguments lead us to a differentiating situation among organizations. Thus, we put forward
the first proposition.

Proposition 1. GSCM innovation adoption can be categorized into varying levels of adoption among various
manufacturers.

Diffusion of GSCM innovation and performance – Proposition 2

Observability is one of the important characteristics of DoI theory which, as implied by EMT,
indicates that innovation should bring observable positive effects from its diffusion. According to DoI
theory, the diffusion of GSCM as an innovation can be viewed as a process of initiation (knowledge),
persuasion, planning, adoption, and confirmation. The initiation of GSCM belongs to a stage that
focuses on the awareness of an upcoming change either due to regulatory requirements or pressures
for environmental protection. This initiation leads to the later stages of diffusion such as persuasion of
management and eventual planning for adoption. Adopting GSCM usually involves commitment of
resources to implementing GSCM under consideration and subsequently to the deployment of GSCM
activities to improve productivity and environmental performance. The culminating activity in this
last stage of GSCM adoption is the use of GSCM practices as organizational technological innovation so
that the benefits from the innovation can be realized to a greater extent by the early adopters (a
confirmation). In line with views of DoI and EMT, by acting early relative to peers, the early adopter of
GSCM may establish pioneer cost and service improvements, enabling it to garner larger performance
gains. According to the literature on innovation, incremental innovation in organizations is dependent
on strategy-structural sequences in the adoption (Grover et al., 2007).
Early adopters may have both first mover advantages and disadvantages (Lieberman and
Montgomery, 1988; Shilling, 2005). By introducing innovative practice at the right time,
manufacturers can gain competitive advantages (Gilbert and Birnbaum-More, 1996). Dimensions
that contribute to first mover advantages include technological leadership, preemption of scarce
assets, and high switching costs by customers. Additional first-mover, early-timing advantages may
include cost advantages such as continued productivity and a shield from operational disruption in
anticipation of future regulatory policy as well as the ability to develop and implement solutions that
will help organizations influence future legislation (Christmann, 2000; Cañón-de-Francia et al., 2007).
There are also first mover disadvantages, second mover advantages, such as ‘free-rider’ effects,
resolution of innovation and market uncertainties, shifts in technological or customer needs, and
incumbent inertia (Lieberman and Montgomery, 1988).
Much of the literature has supported the ‘win-win’ proposition furthering the motivation to adopt
environmental management practices. For example, early adoption of strict environmental standards
and practices may lead to ‘innovation offsets’ that lower costs or improve quality and ultimately lead
to net benefits for the firm (Rugman and Verbeke, 1998). BMW’s ‘design for disassembly’ initiative,
preempting the ‘take-back’ policies of the German government, helped establish an ‘exclusive
recycling infrastructure’ in Germany, where this environment is characterized by involving several
high-quality domestic dismantler firms and reaping first mover advantage (Hart, 1995). There can also
be benefits resulting from the slow diffusion of knowledge in this industry and ‘time compression
diseconomies,’ experienced by the late movers. Another recent study has shown that pioneering
 Q. Zhu et al. / Journal of Engineering and Technology Management 29 (2012) 168–185 173

adopters of environmental management practices have attained relatively better performance

outcomes than other firms in their respective industrial sectors (Claver et al., 2007).
These advantages and disadvantages can be considered as performance consequences of adopting
organizational technological innovation. Innovative practices influence a manufacturer’s financial and
market performance (Akgün et al., 2009; Wong et al., 2009). According to the DoI, such consequences
can be used to determine if an innovation such as GSCM would increase or decrease equality in the
form of performance among the members of a social system (e.g., early vs. late adopters). The diffusion
of innovation can lead to wider performance gaps because earlier adopters are more proactive in new
ideas and more actively seeking innovations, where they also possess more resources for adopting
innovations than their late adopter counterparts. Following this logic, the diffusion of GSCM practices
can reduce performance equality, where the earlier adopters achieve better outcomes, and the
performance gain of the later adopters is comparatively less.
Ecological modernization within China requires innovations which are evaluated on their
contribution to economic improvements but also in resolving environmental problems (Mol, 2006).
Faced with the growing pressure for ecological modernization, GSCM has been increasingly sought
after by many Chinese manufacturing exporters to improve their performance. A proactive GSCM
approach can prepare enterprises for superior short and long-term performance through improved
management of environmental risks and the development of capabilities for continuous environ-
mental improvement in Chinese manufacturers (Zhu and Sarkis, 2004). Given the different paces of
diffusing GSCM innovation to Chinese manufacturers, this leads to the question of whether the early
adopters of GSCM innovation, in terms of the sophistication level of adoption, would outperform the
later adopter groups. Accordingly, on the basis of DoI and previous research that environmental
innovation brings forth improved overall performance, we conjecture that:

Proposition 2. Manufacturers with higher levels of adopting GSCM attain better performance.
Evaluating the propositions will shed light on whether there are different innovation adopter
categories of Chinese manufacturers according to their sophistication levels in implementing GSCM. It
will also provide insight on whether these innovator categorizations, as theorized by EMT and DoI
early adopter advantage, are associated with better performance outcomes. Managerial insights on
the strengths and weaknesses of the identified manufacturer clusters in implementing GSCM can also
be obtained. The following section discusses the methodology employed to obtain answers for the
above research issues.

Methodology

Questionnaire development

We developed a survey questionnaire to examine if there are different GSCM practice innovation
clusters (according to the adoption level) for Chinese manufacturers and if these different GSCM
clusters also differ in performance outcomes. The research process for this study is similar to the
previous literature (Lai, 2004) and involves four main steps: (1) formulation of research problems,
including review of the relevant literature, understanding potential performance improvement
through GSCM, and developing research propositions; (2) questionnaire development, which includes
selecting measurement items for survey questionnaire, designing survey questionnaire, and seeking
comments from academics and practitioners in environmental management and performance
evaluation for content validation; (3) survey administration and data analysis using factor analysis
and reliability tests; and (4) identification of Chinese manufacturer clusters and determination of
whether they vary in GSCM adoption and performance outcomes through cluster analysis and
Analysis of Variance (ANOVA).
To measure GSCM adoption, we developed a list of 21 measurement items on GSCM practices
generally deemed important for environmental management by Chinese manufacturers. The items
were developed on the basis of the literature (Zsidisin and Hendrick, 1998; Walton et al., 1998; Carter
et al., 2000). Suggestions from industrial experts were also incorporated. These experts were senior
managers responsible for environmental issues in eight companies, two from each of the following
174 Q. Zhu et al. / Journal of Engineering and Technology Management 29 (2012) 168–185

four industries: power generating, chemical/petroleum, electronic/electrical, and automotive The

respondents were requested to indicate, using a five-point Likert-type scale (1 = not considering it;
2 = planning to consider it, which means that the GSCM practice was discussed but not planned for
implementation; 3 = considering it currently, which means that the GSCM practice has been planned
for implementation but not carried out yet; 4 = initiating implementation; and 5 = implementing
successfully), the perceived extent of adopting each of the 21 GSCM practices. To determine if the
Chinese manufacturer clusters differ in various performance measures, a five-point Likert-type scale
(where 1 = not at all; 2 = some but insignificant; 3 = some and slightly significant; 4 = significant; and
5 = highly significant) reflecting how managers perceived their performance on 17 measurement items
which are adapted from a previous study on environmental management practices and performance
(Zhu et al., 2005).

Data collection

To minimize extraneous sources of variance due to inter-industry differences, we purposely chose

organizational respondents mainly from four industries: power generating, chemical/petroleum,
electronic/electrical, and automotive.
A pilot test was conducted during two workshops on environmental management in the Tianjin
Economic and Technological Development Area (TEDA) and the Dalian Economic and Technological
Development Zone (DETDZ), the largest and the second largest industrial zones in China. Minor
modifications were made to the measurement instrument, i.e., a survey questionnaire, with pilot test
inputs from 28 organizational respondents.
To obtain initial results, we completed convenience sampling through six workshops in the School
of Management at Dalian University of Technology as well as interviews and site visits in the Dalian
High-tech Zone in Liaoning province and Zibo Industrial Zone in Shandong province. Within this step,
a total of 158 unique and usable organizational responses from manufacturing enterprises were
received.
To avoid potential bias from convenience sampling, we completed random surveys through postal
mail with follow-up calls in Dalian. The targeted sample companies were identified from the list of
Dalian Manufacturers except those manufacturers included in the convenience samples with a focus
on the four industries mentioned above. Out of 1000 questionnaires mailed, 128 usable organizational
responses from manufacturing enterprises were received.
After eliminating the responses with missing values using the listwise method, 245 out of a total of
286 organizational responses were used for data analyses. Most of the organizational informants
targeted by this study and responding to the survey had middle to senior levels of management
experience. Each questionnaire returned represents a single organizational response. A majority of
these responses were obtained from an individual key respondent within a company. The individual
respondent might have consulted with other related persons within the company. There were some
organizational responses received that had two or more responses evaluating the same company. In
this situation, we evaluated the consistency of those questionnaire responses and combined them into
one aggregate response by averaging and confirming valuations with respondents through additional
interviews or phone calls.
This respondent profile is comparable to other research of a similar nature such as Lai et al. (2008)
where executives at this level are knowledgeable and involved in logistics innovations such as green
supply chain management who can, at a minimum, facilitate incremental adoption of environmental
management practices, which is consistent with our findings from extensive corporate interviews
beyond the survey instrument.
The demographic profile of the respondent organizations in terms of industry category and
employment organizational size is summarized in Table 1. As mentioned, we targeted four main
industries, i.e., power generating, chemical/petroleum, electrical/electronic, and automotive, with
69.8% of the respondent firms belonging to the four industries. The rest of the respondent firms
(representing 30.2% of the total) belong to the pharmaceutical, food processing, steel, and textile
industries. To obtain a sample size viable for data analyses and statistical generalization, we included
respondents from other industries due to the difficulties to secure a sample size, from the four main
 Q. Zhu et al. / Journal of Engineering and Technology Management 29 (2012) 168–185 175

Table 1
Profile of the respondent Chinese manufacturers.

Total Percentage

Industry
Power generating 53 21.7
Chemical/petroleum 38 15.5
Electrical/electronic 18 7.3
Automobile 62 25.3
Other 74 30.2

Total 245 100

Size (employees)
>3000 63 25.7
1001–3000 47 19.2
500–1000 77 31.4
<500 58 23.7

Total 245 100

Ownership
State-owned 161 65.7
Private 52 21.2
FDI or JV 32 13.1

Total 245 100

targeted industries, adequate enough to achieve these purposes. Most of the 245 respondent
organizations (161) are state-owned, accounting for 65.7% of the sample organizations.

Tests for potential bias

To examine the threats of potential bias with survey data, we performed several tests for evaluating
the bias issues before proceeding to further statistical analyses.
We assessed the potential sampling bias by dividing the total 245 responses into two groups, i.e.,
the convenient sample (n = 128, 52.2%, collected from the workshops) and the random sample (n = 117,
47.8%, collected from mail surveys). The answers provided by the two respondent groups in their
evaluation of the 38 questionnaire items for measuring GSCM practices and performance were
compared using a series of t-tests. The test results indicate that at a 5% significance level in all the 38
measurement items, no statistical difference was found in the mean values between the two groups.
To evaluate non-response bias issues with the mailed survey, we separated the 128 returned
questionnaires from the random survey into two groups. The 82 questionnaires in the first group were
returned within 2 weeks after the initial mailing. The 46 questionnaires in the second group were
obtained through follow-up actions using telephone calls within 1 month after the mailing. We
compared the mean values of the 21 items and the five GSCM practice factors as well as the 17 items
and the three factors for GSCM performance between the two groups using t-tests. No differences
were found between the groups at the p > 0.05 level for all items and factors. These results suggest that
non-response bias should not be a problem in this study (Armstrong and Overton, 1977).
The threat of common method variance (bias) was also examined through at least three procedural
remedies described by Podsakoff et al. (2003). First, items for GSCM practices and performance were in
different parts separated by items on GSCM drivers in the questionnaire. Second, both the respondents
and the companies were anonymous. Third, 28 industrial respondents during our pilot test helped to
improve the items, ensuring that the questionnaire can be easily understood. We further carried out a
post hoc statistical test using the Harman’s one factor approach through confirmatory factor analysis.
The fit statistics of the one-factor model in this approach were x2 (df) = 5193.3(629), p = 0.001;
GFI = 0.40; CFI = 0.52; NFI = 0.49; IFI = 0.52; RMR = 0.16; RMSEA = 0.15, which indicates a poor model fit,
suggesting that the possibility for common method bias in our survey data is low.
 176
Table 2
Implementation of GSCM practices as perceived by the respondent Chinese manufacturers.

Q. Zhu et al. / Journal of Engineering and Technology Management 29 (2012) 168–185

GSCM practices Mean S.D. 1 (%) 2 (%) 3 (%) 4 (%) 5 (%)

Commitment of GSCM from senior managers 3.73 1.136 4.9 10.6 20.4 35.1 29.0
Environmental compliance and auditing programs 3.73 1.093 4.9 8.2 22.4 37.6 26.9
Total quality environmental management 3.61 1.138 5.7 10.2 26.5 32.2 25.3
Design of products for reduced consumption of materials/energy 3.61 1.105 5.3 9.8 26.5 35.1 23.3
Cross-functional cooperation for environmental improvements 3.56 1.068 4.9 11.0 25.7 39.6 18.8
Support for GSCM from mid-level managers 3.54 1.022 4.5 10.6 26.9 42.4 15.5
Design of products to avoid or reduce use of hazardous 3.54 1.157 6.9 11.4 24.5 35.1 22.0
products and/or their manufacturing process
Investment recovery (sale) of excess inventories/materials 3.49 1.243 11.0 8.2 24.9 32.7 23.3
Sale of scrap and used materials 3.49 1.151 8.2 10.6 23.3 39.6 18.4
Sale of excess capital equipment 3.37 1.129 8.2 12.2 29.0 35.5 15.1
Environmental management systems exist 3.32 1.220 10.2 14.3 27.3 29.8 18.4
Design of products for reuse, recycle, recovery of 3.30 1.193 11.8 10.6 27.8 35.5 14.3
\materials, component parts
Providing design specification to suppliers that include 3.23 1.234 11.4 16.3 26.1 29.8 11.8
environmental requirements for purchased item
ISO 14001 certification 3.22 1.351 15.9 13.1 26.1 23.3 21.6
Suppliers’ ISO 14000 certification 3.10 1.322 18.0 13.5 24.1 29.4 15.1
Cooperation with suppliers for environmental objectives 3.04 1.246 13.9 22.0 22.4 29.8 16.3
Cooperation with customers for cleaner production 2.97 1.229 16.3 18.4 26.5 29.4 9.4
Cooperation with customers for green packaging 2.89 1.216 19.6 13.5 33.5 25.7 7.8
Environmental audit for suppliers’ internal management 2.71 1.268 24.1 19.2 25.7 25.7 9.3
Cooperation with customers for eco-design 2.65 1.237 24.1 20.4 28.6 20.0 6.9
Second-tier supplier environmentally friendly practice evaluation 2.62 1.251 25.7 20.4 26.5 20.8 6.5

Note: Scales are: 1 = not considering it; 2 = planning to consider it, which means in the early phases of discussion and consideration and may not be considered for final implementation;
3 = considering it currently, which means that the GSCM practice has been planned for and is on the way to implementation but not carried out yet; 4 = initiating implementation;
5 = implementing successfully.
 Q. Zhu et al. / Journal of Engineering and Technology Management 29 (2012) 168–185 177

Results

Comparisons for GSCM practice

Table 2 summarizes the rank order results of GSCM practices based on the mean values as reported
by the respondents. The larger the mean value reported the more mature the implementation of the
GSCM practices at the respondent firm and vice versa.
We conducted an exploratory factor analysis (EFA) to assess the 21 measurement items for GSCM
adoption. The initial factor solution resulted in four factors with Eigenvalues higher than unity. The
four-factor solution for the 21 items accounted for 70.5% of the total variance explained. Table 3 shows
a purified list of 21 items with a clear factor structure in four factors from the results of EFA. The four
identified factors are summarized as follows:

Factor 1: Internal environmental management accounts for 45.4% of the total explained variance
and consists of seven items.
Factor 2: External GSCM accounts for 10.4% of the total explained variance and consists of eight items.
Factor 3: Eco-design accounts for 9.0% of the total explained variance and consists of three items.
Factor 4: Investment recovery accounts for 5.7% of the total explained variance and consists of
three items.

The results of a reliability test and an item-total correlation analysis also showed that the derived
factors are reliable. The reliability coefficient alpha values of the four factors are high with 0.94 for
internal environmental management, 0.91 for external GSCM, 0.86 for eco-design, and 0.81 for
investment recovery, exceeding the benchmark value of 0.70 for exploratory research (Nunnally and
Bernstein, 1994). All item-total correlation coefficients are also high, ranging from 0.67 to 0.83 for
internal environmental management, from 0.64 to 0.74 for external GSCM, from 0.71 to 0.75 for eco-
design, and from 0.60 to 0.74 for investment recovery.

Table 3
Results of exploratory factor analysis for GSCM practices.

GSCM practices items Factor loadinga Alpha

Providing design specification to suppliers that include 0.302 0.574 0.341 0.048 00.91
environmental requirements for purchased item
Cooperation with suppliers for environmental objectives 0.393 0.595 0.289 0.116
Environmental audit for suppliers’ internal management 0.167 0.791 0.037 0.082
Suppliers’ ISO 14000 certification 0.309 0.752 0.013 0.004
Second-tier supplier environmentally friendly practice evaluation 0.235 0.774 0.076 0.111
Cooperation with customers for eco-design 0.234 0.682 0.251 0.223
Cooperation with customers for cleaner production 0.200 0.652 0.225 0.313
Cooperation with customers for green packaging 0.137 0.770 0.180 0.193
Investment recovery (sale) of excess inventories/materials 0.110 0.227 0.249 0.758 00.81
Sale of scrap and used materials 0.124 0.089 0.125 0.861
Sale of excess capital equipment 0.039 0.159 0.038 0.817
Design of products for reduced consumption of materials/energy 0.248 0.124 0.803 0.247 0.86
Design of products for reuse, recycle, recovery of materials, 0.167 0.191 0.817 0.116
component parts
Design of products to avoid or reduce the use of hazardous 0.390 0.285 0.733 0.101
products and/or their manufacturing process
Commitment to GSCM from senior managers 0.819 0.194 0.254 0.154 0.94
Support for GSCM from mid-level managers 0.838 0.204 0.187 0.147
Cross-functional cooperation for environmental improvements 0.745 0.208 0.295 0.150
Total quality environmental management 0.834 0.277 0.212 0.078
Environmental compliance and auditing programs 0.772 0.172 0.314 0.140
ISO 14001 certification 0.692 0.404 0.018 0.076
Environmental management systems exist 0.797 0.310 0.039 0.003

Note: Extraction method: principal component analysis. Rotation method: Varimax with Kaiser normalization. Underline
indicates the highest loading.
a
Rotation converged in 6 iterations.
178 Q. Zhu et al. / Journal of Engineering and Technology Management 29 (2012) 168–185

Table 4
ANOVA statistics and cluster means on GSCM practices.

Factor/cluster Early adopters (n = 133) Followers (n = 72) Laggards (n = 40) F

Internal environmental management 4.16 2.96 2.45 138.49

External GSCM 3.55 2.30 1.83 151.11
Eco-design 3.84 3.54 1.98 94.30
Investment recovery 4.08 3.13 2.13 126.50
GSCM practice 3.91 2.98 2.10 475.95

Note. Scales are: 1 = not considering it; 2 = planning to consider it, which means in the early phases of discussion and
consideration and may not be considered for final implementation; 3 = considering it currently, which means that the GSCM
practice has been planned for and is on the way to implementation but not carried out yet; 4 = initiating implementation;
5 = implementing successfully.

Table 5
Scheffe multiple comparison test results.

Factors Clusters Level of significance

2 3
***
Internal environmental management 1 1.20 1.71***
2 0.50**

External GSCM 1 1.25*** 1.72***

2 0.47**

Eco-design 1 0.30* 1.86***

2 1.56***

Investment recovery 1 0.95*** 1.95***

2 1.00***

Note: Scales are: 1 = not considering it; 2 = planning to consider it, which means in the early phases of discussion and
consideration and may not be considered for final implementation; 3 = considering it currently, which means that the GSCM
practice has been planned for and is on the way to implementation but not carried out yet; 4 = initiating implementation;
5 = implementing successfully.
*
p< 0.05.
**
p< 0.01.
***
p< 0.001.

To determine if there are different kinds of Chinese manufacturers in terms of their GSCM adoption,
we performed a cluster analysis. Both hierarchical and non-hierarchical cluster methods were used in
the analysis as suggested by Hair et al. (2010). After the hierarchical analysis, a K-mean cluster analysis
(a non-hierarchical clustering technique) of the three factors was performed. The results in Table 4
show that the 245 respondent manufacturers were assigned to one of the three clusters in the K-mean
cluster analysis – 133 in cluster 1, 72 in cluster 2, and 40 in cluster 3. To assess whether the mean
values of the four factors were significantly different across the three clusters, ANOVA and the Scheffe
multiple test were performed. The test results are shown in Tables 4 and 5. As indicated in the Scheffe
multiple comparison test results, each cluster has unique attributes.
The results from the cluster analysis suggest that there are three clusters of manufacturers in China
in terms of their GSCM adoption. We label the three clusters of GSCM as early adopters, followers, and
laggards. The first cluster (n = 133), labeled as early adopters, accounts for 54.3% of the sample. This
first cluster had the highest level of GSCM practices adoption, but the mean value of the overall GSCM
practice is only 3.91 (4 = initiate implementation), and thus we labeled this group as the early adopter
group. As shown in Table 4, the mean value of overall GSCM for early adopters is close to 4.00 and two
mean values of the four factors are over 4.00. Thus, we see that these early adopter manufacturers in
China have initiated two innovative GSCM practices, namely, internal environmental management
and investment recovery. Integrating environmental concerns into the early stage of product design is
important for the sustainability development of manufacturers (Petala et al., 2010). However, the
mean value of eco-design for the early adopters is 3.84, which indicates that only some of the early
 Q. Zhu et al. / Journal of Engineering and Technology Management 29 (2012) 168–185 179

adopters have implemented eco-design. For the external GSCM practices, the early adopter
manufacturers are still at the consideration stage rather than actually initiating adoption, with a mean
value of 3.55. The value for this practice is the lowest when compared to the mean values of the other
three GSCM practices factors for this cluster of manufacturers. But the early adopters are still relatively
more advanced in implementing external GSCM practice when compared to the other two clusters of
manufacturers in China. Further analysis finds that a majority of the manufacturers in this cluster
(126, 91.9%) are medium to large sized organizations with more than 500 employees. This cluster
includes 34 companies in the power generating industry, 23 companies in the chemical industry, 14
companies in the electrical/electronic industry, and 20 companies in the automobile industry.
The second GSCM adoption cluster for Chinese manufacturers is labeled followers, with 72
manufacturers accounting for 29.4% of the sample manufactures. We identify this cluster as followers
because they have at least initiated consideration of some GSCM practices with relatively higher mean
values in two GSCM practice factors: eco-design (3.54) and investment recovery (3.13). However, they
have paid less attention to GSCM as indicated in the overall mean value of 2.98 in their GSCM adoption.
The two mean values for the factors on external GSCM and internal environmental management
practices are both below 3.00 (considering it currently) with 2.30 for external GSCM and 2.96 for
internal environmental management, respectively.
There were 40 Chinese manufacturers (16.3%), the smallest cluster in the sample, labeled laggards.
We identify this cluster as laggards because overall these manufacturers responded that they have not
considered these GSCM practices. All the four GSCM practice factors and one composite factor in this
manufacturer cluster had mean values lower than 2.45. The mean values for the laggard cluster were
2.45 for internal environmental management, 1.83 for external GSCM, 1.98 for eco-design, 2.13 for
investment recovery, and 2.10 for the overall GSCM practice. Further analysis finds that about half of
them (19, 47.5%) are small companies employing less than 500 employees.

Comparisons for GSCM caused performance improvement

To check if and how manufacturer adoption categories are related to performance outcomes, we
conducted an EFA to assess the dimensionality of the 17 items for measuring GSCM caused
performance improvements, using a similar methodological approach for assessing the GSCM practice
adoption items. After validating the dimensions of these performance outcomes, we performed a one-
way ANOVA to examine if the manufacturer adoption categories differ in each of the performance
dimensions.
The initial factor solution resulted in three factors with Eigenvalues higher than unity. To purify the
list, an item (decrease of fines for environmental accidents) was deleted due to low loading, i.e., 0.50,
on its underlying factor. The three-factor solution for the 16 items accounted for 73.7% of the variance
explained. Table 6 shows a purified list of the 16 items with a clear factor structure in the three GSCM
caused performance improvement factors. These items account for 75.3% of the total variance
explained with three identified factors, which are labeled as environmental performance (six items),
operational performance (four items), and economic performance (four items).
The results of a reliability test and an item-total correlation analysis showed that the GSCM caused
performance improvement factors are reliable. The reliability coefficient alpha values of the three
factors are high with 0.94 for environmental performance, 0.90 for operational performance and 0.93
for economic performance, exceeding the threshold value of 0.70 for exploratory research (Nunnally
and Bernstein, 1994). All item-total correlation coefficients are also high, ranging from 0.75 to 0.85 for
environmental performance improvement, from 0.67 to 0.84 for economic performance improve-
ment, and from 0.77 to 0.82 for operational performance improvement.
A one-way ANOVA is performed to examine whether differences exist between the mean values of
the three factors and the overall performance improvement among the three clusters of GSCM practice
adopters. The ANOVA results shown in Table 7 indicate that statistically significant differences, i.e.,
p < 0.05, exist among the three GSCM adopter clusters in all the four performance factors and in the
overall GSCM caused performance improvement. In sum, GSCM pioneering manufacturers (early
adopters) appear to have the highest level of overall GSCM caused performance improvement
(mean = 3.76). The followers have the second highest mean values in the performance outcomes
180 Q. Zhu et al. / Journal of Engineering and Technology Management 29 (2012) 168–185

Table 6
Results of exploratory factor analysis for GSCM caused performance.

GSCM performance items Factor loadinga Alpha

Reduction of air emission 0.807 0.288 0.219 0.94

Reduction of waste water 0.817 0.253 0.233
Reduction of solid wastes 0.777 0.189 0.369
Decrease of consumption for hazardous/harmful/toxic materials 0.826 0.223 0.190
Decrease of frequency for environmental accidents 0.781 0.283 0.221
Improve an enterprise’s environmental situation 0.736 0.372 0.170
Decrease of cost for materials purchasing 0.303 0.196 0.711 0.90
Decrease of cost for energy consumption 0.224 0.253 0.792
Decrease of fee for waste treatment 0.204 0.320 0.839
Decrease of fee for waste discharge 0.273 0.268 0.840
Increase amount of goods delivered on time 0.305 0.730 0.277 0.93
Decrease inventory levels 0.258 0.753 0.214
Decrease scrap rate 0.272 0.758 0.251
Promote products’ quality 0.286 0.820 0.178
Increased product line 0.224 0.812 0.240
Improved capacity utilization 0.214 0.824 0.221

Note: Extraction method: principal component analysis. Rotation method: Varimax with Kaiser normalization. Underline
indicates the highest loading.
a
Rotation converged in 6 iterations.

Table 7
ANOVA statistics and cluster means on GSCM caused performance.

Factor/cluster Early adopters (n = 133) Followers (n = 72) Laggards (n = 40) F

Environmental performance 4.10 3.48 2.74 45.56

Operational performance 3.46 3.02 2.41 24.64
Economic performance 3.81 3.21 2.71 29.88
GSCM performance 3.76 3.24 2.59 42.60

Note: 1 = not at all; 2 = some but insignificant; 3 = some and slightly significant; 4 = significant; and 5 = highly significant.

(mean = 3.24). Laggards are found to have the lowest level of GSCM caused performance improvement
(mean = 2.59). On the basis of the self-reported performance by the respondent organizations, Chinese
manufacturers in different GSCM adopter clusters differ in their GSCM caused performance
improvement.

Conclusions and discussions

Overall our results show that varying organizational characteristics and top managers’ attitudes
cause organizations to adopt innovations at different phases (Damanpour and Schneifer, 2006). The
statistical analyses of our empirical data collected from 245 Chinese manufacturers support the
propositions that manufacturers in China may be grouped, based on DoI, into different GSCM adopter
clusters, and that these groupings attain varying levels of GSCM which caused supporting EMT
performance improvements. The results show that organizations will seek to adopt GSCM practices at
different levels of sophistication. It appears from the results of this study that the Chinese
manufacturers can be classified into three clusters according to the level of their GSCM adoption. DoI
provides an appropriate theoretical lens for identifying the different stages of diffusing GSCM
practices from the proactive early adopters to their reactive counterparts as laggards. Many
organizational and environmental factors influence the commitment of a firm to innovate.
Nevertheless, according to our results and supporting the results of other studies, the management
team, especially those at the top organizational level, is most influential on organizational
technological innovation (Hsu et al., 2008). Our ANOVA results show that the difference on internal
environmental management is largest, in terms of statistical significance, among the three clusters in
their adoption of GSCM innovation.
 Q. Zhu et al. / Journal of Engineering and Technology Management 29 (2012) 168–185 181

The differences in GSCM adoption by Chinese manufacturers suggest that different patterns of
implementing GSCM practices are pursued by each cluster. Early adopters have initiated proactive
investment recovery as well as planned to implement eco-design and external GSCM under the high
level of internal environmental management. Followers only consider internal environmental
management, and replicate the path of early adopters with partial initiation of eco-design and
investment recovery. Laggards fail to initiate or even plan any GSCM practices. The association
between adopter categorizations and performance entails that having a more extensive adoption of
GSCM practices, i.e., involving both internal and external aspects, and implementing them more
intensively will lead to a better performance outcome. The findings imply that it is more desirable for
Chinese manufacturers to pursue all the GSCM practices factors at a high level to improve performance
in the supply chain.
It is noted from the cluster analytic result that a majority of our adopter categorization belongs to
early adopters, which represent the largest GSCM adoption cluster with 133 respondents. Yet, we
should be cautious about this observation since early adopter is a relative term. These organizations
may be considered early adopters in the Chinese market, but internationally be considered later
adopters. Our study results indicate that early adopters have initiated two GSCM practices, namely,
internal environmental management and investment recovery, and they also perform well in all the
GSCM caused performance improvement measures. However, even for these pioneering Chinese
manufacturers, they are only initially considering external GSCM practices with a mean value of 3.55.
This result indicates that they need to further integrate environmental concerns into their cooperation
with their suppliers and customers.
GSCM followers have considered adopting internal environmental management and eco-design,
ranking second only to those of the early adopters. Two of the four GSCM factors such as eco-design
and investment recovery have relatively high mean values of 3.54 and 3.13, respectively. However,
investment recovery has received much less attention in China when compared to the more developed
countries such as the USA and Germany, primarily due to waste management policies and the lack of
recycling systems and infrastructure. United States and European enterprises have considered
investment recovery as a critical aspect for green purchasing and GSCM (Zsidisin and Hendrick, 1998).
In China, the government has evolved its regulatory and fiscal practices from resource subsidies to
levying taxes for natural resources such as coal and natural gas (Zhu and Cote, 2002).
Laggards belong to the smallest cluster with 40 Chinese respondent manufacturers in our sample.
Most of them have yet to enter the planning stages of GSCM practice adoption. Such phenomena may
be due to a number of reasons. The first reason is that these manufacturers have not experienced
critical environmental pressures and thus lack the external motivation and drivers to initiate
consideration of these environmental management practices. Another possible reason is that many of
the laggards are small in organizational size, lacking the financial and knowledge resources to
implement proactive environmental management practices. Other reasons may include risk-aversion
to innovations and possibly a managerial belief that these practices may actually be detrimental to
their progress. The variety of possible reasons provides ample opportunity for further investigation to
help distill the complexities of innovation adoption, especially GSCM practices.
EMT essentially states that firms with enhanced environmentally friendly policies can bring
improved innovation and thus gain better performance (Craig and Dibrell, 2006). We have found that
these three clusters of Chinese manufacturers achieve different levels of performance improvements
according to their level of adopting GSCM practices. The results showed that early adopters
outperform the other two clusters of Chinese manufacturers in adopting GSCM on all the three
performance measures and the overall performance improvement. Early adopter advantage is clearly
visible in these results. These early adopters of the GSCM practices are taking advantage of these early
innovations, while reaping substantial benefits. Thus, we can see that EMT is strongly supported and
an appropriate lens for studying and explaining GSCM practice adoption in China. Essentially, we can
strongly support the proposition that these environmentally innovative practices bring forth
economic, environmental, and operational benefits concurrently, when compared to the followers and
laggards. Awareness of these results, especially for those organizations that have been risk-averse due
to potentially detrimental outcomes, should be encouragement for laggards and followers to further
enhance their GSCM adoption.
182 Q. Zhu et al. / Journal of Engineering and Technology Management 29 (2012) 168–185

However, the results also showed that differences in performance among the three diffusion
clusters are not as large as differences in the levels of adopting GSCM practices. It may be also the main
reason that manufacturers in China (followers and laggards) are reluctant to adopt GSCM practices.
The results indicate that GSCM experiences should be able to diffuse from early adopters to laggards
but it will take time to progress through these several stages.

Implications

Implications for researchers

From a research perspective, understanding the categorization of manufacturers in terms of GSCM
adoption and how this may affect their performance opens up new avenues to develop theories on
GSCM and more broadly on environmental management practices. For instance, under what
circumstances such as certain opportunities and threats do manufacturers emphasize GSCM
practices? How do manufacturers formulate strategies and deploy resources to implement GSCM
practices? In formulating a strategy for GSCM adoption, will certain aspects be more (or less)
important? Longitudinally, do later adopters reap the same benefits as the early adopters? That is, is
there a strong contingency aspect to EMT?
This study provides an integration of two theories to help guide the research in this area. Both a DoI
theoretic and a contingent EMT perspective help understand the different categories of manufacturers
and their performance implications with respect to the adoption of varying aspects of GSCM
innovations. The results support the use of the DoI as a theoretical lens through which to understand
the unique situations of different types of Chinese manufacturers in terms of GSCM adoption. The
results also support the use of EMT to study the relationship between GSCM innovations and
performance in Chinese manufacturing. The results suggest that Chinese manufacturers belonging to
the early adopter cluster that embrace a higher level of GSCM adoption attain better performance.
Thus, it is important to consider GSCM as a management practice to gain competitiveness for Chinese
manufacturers in view of the globalization of business, especially after China’s entry into the WTO.
EMT has its origins at the social and national policy level. Thus, we can see that China’s macro policies
on ecological modernization, for example the ‘circular economy’, have filtered to the disaggregated
micro level of organizations. Some theoretical support is advanced for the application of EMT at
multiple levels of analysis, a broader national governmental level and specific industry and
organizational level.
Our survey results show that three clusters of Chinese manufacturers exist in terms of their GSCM
adoption characteristics, and that even the most advanced Chinese manufacturers are early adopters
who have only started to initiate the adoption of GSCM. It is useful for further research to examine if
and how Chinese manufacturers can learn from their counterpart foreign manufacturers, especially
those operating business in China on the adoption of GSCM. The issue on how the experiences of early
adopters can be diffused to the followers as well as the laggards should also be explored.

Implications for managers and policy makers

From the managerial standpoint, the results of this study show that the three clusters of GSCM
adopters differ in environmental, operational, and economic performance. To successfully compete in
different markets, it is necessary for Chinese manufacturers to assess their own strengths and
weaknesses in their GSCM practices relative to potential threats such as their regulatory pressures and
potential opportunities such as market drivers. The study results provide insights for managers into
the characteristics of Chinese manufacturers in terms of GSCM practices, which are useful for them to
formulate plans to benchmark and set targets for GSCM practices and performance improvement in
the different markets in which they are operating or intend to compete. Our study results can also
serve as evidence that adoption of these environmental management practices provide consistently
substantial performance benefits. An organization’s tactics and strategies are not stagnant (Clemens,
2001). To gain or keep competitiveness by grasping opportunities and avoiding threats, it is important
for Chinese manufacturers to establish proactive environmental strategies and implement proactive
environmental management practices such as GSCM. When GSCM practices are appropriately
implemented there are greater opportunities for win-win situations to exist. In addition, the length of
 Q. Zhu et al. / Journal of Engineering and Technology Management 29 (2012) 168–185 183

time it takes for a manufacturer to proceed from one stage to another may be different. This diffusion
speed will greatly depend on internal organizational efforts and capability. If laggards adopt GSCM
proactively, instead of as a reactive response to pressures, they may achieve the desired performance
more rapidly. Conversely, if an early adopter fails to make significant effort for furthering the
implementation of GSCM practices, they may require a longer time to reap the potential benefits.
Although Chinese manufacturers are facing increasing domestic regulatory forces, international
green barriers represent continuing and emerging challenges for Chinese manufacturers to compete
internationally in this era of global manufacturing. The Chinese government, to advance its ecological
modernization policies, can help manufacturers learn from foreign manufacturers by providing
knowledge and training on practicing GSCM. Also, the Chinese government can identify pioneering
manufacturers in different industrial sectors and operational scales as benchmarks for implementing
GSCM. These benchmark companies would provide valuable lessons to other manufacturers who are
implementing or intending to embrace GSCM in their operations. In this group of pioneering
manufacturers, their environmental discharges are usually better or even superior to those specified
in the governmental standards. In this case, the Chinese government should recognize their
environmental achievements or even provide subsidies to intensify their proactive GSCM innovations.

Future research directions

There are some limitations which may affect the interpretation of our study results. First, due to the
difficulty in collecting data in China, 245 questionnaires were collected by both convenient and
random surveys. Larger and more typical respondents are needed to enhance the robustness of our
study results. Second, we only considered operational performance. In the case of Chinese
manufacturers, objective data on performance improvement are difficult to obtain or are non-
existent. Most Chinese manufacturers do not collect such data and in many cases they also refuse to
expose such data even if they have collected it. A further study on successful Chinese manufacturers in
GSCM adoption with objective data for evaluating their performance is highly desirable. Third, we
identified three clusters of GSCM adopters in the Chinese manufacturing context. Tidd (2001)
concludes uncertainty and complexity are key environmental contingencies that influence
organizational structure and management processes for innovation. Further examination is needed
to answer such questions as: What factors affect companies to place different emphases on the GSCM
practice factors in their implementation journey? How to stimulate laggards to implement GSCM?
How can GSCM be further diffused from early adopters to laggards? In addition, some industries and
companies may be encountering alternative motivating pressures, e.g., regulatory versus competitive
pressures, for adopting GSCM. These alternative motivations and how they influence the diffusion of
this innovation and the link with performance outcomes is a worthwhile investigation for further
research.
It is also useful for future studies to use other theoretical perspectives such as the theory of
environmental flows (Moland and Spaargaren, 2005) to explore the diffusion of innovative
environmental management practices. Fourth, we only provide a general demographic profile of
all the respondent Chinese manufacturers and identify the size-related characteristics of two clusters,
namely early adopters and laggards. Further disaggregated analysis is helpful to explain the
organizational differences in terms of size, ownership, and industry types among the different
manufacturer clusters in adopting GSCM. Fifth, we found that Chinese manufacturers with lower
levels of adopting GSCM have weaker environmental, operational, and economic performance. Further
study should examine the relationship among individual factors of GSCM practices and individual
factors of performance, which should be useful for managers to identify proper GSCM practices to
strengthen their individual performance areas that are in need of improvements.

Acknowledgements

We thank the two anonymous reviewers for their useful comments on an earlier version of this
paper. This work is supported by a grant from National Science Fund for Distinguished Young Scholars
184 Q. Zhu et al. / Journal of Engineering and Technology Management 29 (2012) 168–185

(71025002), National Basic Research Program of China (973 Program, 2011CB013406) and the
National Natural Science Foundation of China Projects (70772085, 71033004). Lai was supported by a
grant from the Research Grants Council of the Hong Kong Special Administrative Region, China (GRF
PolyU 5434/08H).

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