Clean Technologies and Environmental Policy

https://doi.org/10.1007/s10098-020-01871-6

ORIGINAL PAPER

Investigating the effect of multidimensional network capability

and eco‑innovation orientation for sustainable performance
Dhekra Ben Amara1 · Hong Chen1

Received: 23 January 2020 / Accepted: 27 May 2020

© Springer-Verlag GmbH Germany, part of Springer Nature 2020

Abstract 
Small and medium enterprises cannot achieve environmental sustainability goals in isolation. They need to acquire capa-
bilities to perform within networks of professional and social relations with other organizations. However, network rela-
tionships are often insufficient due to lack of sustainability in network capability. This multidimensional concept involves
four components: coordination, relational skills, partner knowledge, and internal communication. This study proposes a
new dimension related to the collaborative environmental relationship. This component addresses an enterprise’s ability to
enhance environmental collaboration, share knowledge, and increase environmental awareness. This study, therefore, sug-
gests testing and comparing the five-dimensional scale of network capability with the existing four-dimensional scale, and
examining its impact on eco-innovation capability and sustainable performance. This has not been tested previously. Using
partial least squares path modelling, this study tests a set of hypothesised relationships that focus on a sample of 237 Tunisian
enterprises. The findings reveal that: (1) the sample supports measurement properties of the updated network capability and
indicates that the new dimension in network capability research and sustainable development is important and can be added
to the finalised network capability construct, (2) network capability, with the updated five dimensions, directly and positively
influences eco-innovation capability and sustainable performance, and the impacts are more effective than in the previous
four-dimensional construct, and (3) eco-innovation mediates the relationship between network capability with the updated five
dimensions and enterprises’ sustainable performance, and the impact is more effective than in the previous four-dimensional
construct. Therefore, our study will help strengthen the enterprise’s performance in promoting sustainable development.

* Hong Chen
nefuchenhong@yeah.net
Dhekra Ben Amara
ben.amara@nefu.edu.cn
1
School of Agricultural Economics and Management,
Northeast Forestry University, Harbin,
People’s Republic of China

13
Vol.:(0123456789)

Graphic abstract
Keywords  Network capability · Eco-innovation capability · Performance · Sustainable development · Entrepreneurship
Introduction
Eco-innovation leads to enhanced sustainability through
efficient use of natural resources. It also embeds environ-
mental sustainability in the culture, practices, and missions
of organisations. Saunila et al. (2018) argued that eco-inno-
vation is crucial for value creation and offers an excellent
opportunity for satisfying customers’ demands and prefer-
ences without harming the natural environment (Saunila
et  al. 2018). Eco-innovation practices help improve the
quality of life within society and help maintain the integrity
of the wider ecosystem. Eco-innovation is defined as innova-
tion in new ways, processes, products, or practices needed
to generate new business opportunities and environmental
benefits (Arranz et al. 2020).
However, enterprises cannot achieve environmental sus-
tainability in isolation. They need to acquire capabilities to
perform within professional networks and through social
relations with other organisations. This gives enterprises
the power to access resources and inputs that are otherwise
13
D. Ben Amara, H. Chen
difficult to acquire (Ahuja et al. 2012). Networks also trans-
fer information and knowledge that give organisations the
opportunity to inspire innovation (Brass et al. 2004). Keep-
ing this in mind, some scholars perceived networking as
an organisational capability (Walter et al. 2006) and as a
strategic instrument to promote connections by organising,
preserving, perfecting, and simplifying internal communi-
cation channels. Networking also improves knowledge of
various partners for an effective cooperation at all levels and
hence helps sustain high performance (Tolstoy and Agndal
2010). Walter et al. (2006) designed network capability as a
multidimensional variable and defined it as an enterprise’s
ability to evolve and use inter-organisational connections
with different stakeholders to improve access to resources.
This study proposes a framework to investigate the rela-
tionship between eco-innovation capability, updated network
capability, and enterprises’ sustainable performance. Theo-
retically, this study aims to understand how enterprises could
better manage their capabilities in the environmental context
and achieve sustainable performance. Such a study has not
Investigating the effect of multidimensional network capability and eco‑innovation…
been carried out for Tunisian enterprises. In 1990, Tunisia
became the first state in the Middle East and in the North
of Africa, to develop an environmental national action plan.
Nevertheless, no research has been conducted on sustainable
environment in the context of the Tunisian economic policy
(ITES 2017). This study aims to fill this gap and examine the
strategic environmental capability of Tunisian enterprises.
This study will provide a framework to explore the fol-
lowing two questions.
First, to what extent do network capability dimensions
(existing and updated) influence eco-innovation capabilities
and enterprises’ sustainable performance? Most studies have
highlighted the meaningfulness network capability (Walter
et al. 2006). However, in the context of sustainability, the
relationships between the evaluation of the multidimensional
scale of network capability, eco-innovation capability, and
enterprises’ sustainable performance are yet to be thoroughly
examined. To fill this gap, we suggest testing and evaluat-
ing a multidimensional network capability in the context of
sustainability. Specifically, we developed a five-dimensional
network capability measurement scale (the fifth component:
collaborative environmental relationships) to examine its
impact on various results. Further, we compared it with the
previous four-dimensional network capability scale.
Second, to what extent does eco-innovation capability
mediate the relationship between network capability dimen-
sions and sustainable performance in a sustainable model?
To the best of our knowledge, few studies have examined
the mediation role of eco-innovation capability between net-
work capability and enterprise performance in the context of
sustainability. We argue that the mediation role of eco-inno-
vation capability may stimulate the power of network capa-
bility to develop opportunities and environmental values,
as well as achieve the enterprises’ sustainable performance.
The rest of the article is organised as follows: after the
development of hypotheses, we report our results. Subse-
quently, we present a discussion of our findings. The impli-
cations for practice and further research are discussed in the
conclusion section.
Literature review and hypothesis
development
Network capability: defining the variable and its
component in the context of sustainability
Networks make use of business opportunities. They also help
access primary resources such as capital, goods, services,
information, and knowledge—these are crucial for achieving
and maintaining competitive advantage (Gulati et al. 2000).
To be competitive, enterprises need to reduce product cost,
improve quality and public image, and boost their networks
with suppliers and other stakeholders. Close and robust rela-
tionships give entrepreneurs or managers the ability to col-
lect a broader range of resources and opportunities, receive
market information, provide solutions to common problems,
and acquire financial resources possessed by other players
(Hoang and Antoncic 2003). Similarly, enterprises engage
in networking to overcome a paucity of resources, compe-
tences, and knowledge in the implementation of eco-inno-
vation practices. However, network relationships are insuf-
ficient without capabilities. Walter et al. (2006) described
network capability as an enterprise’s ability to evolve and
use an inter-organisational connection with different stake-
holders to improve access to various resources.
Walter et al. (2006) defined network capability as a mul-
tidimensional concept with four components: (1) coordina-
tion activities that are characterised as boundary-spanning
activities—these help coordination among cooperating
enterprises; (2) relational skills involving communication
ability, emotional stability, empathy, self-reflection, and con-
flict management; (3) partner knowledge, namely the posses-
sion of structural and organisational information and inputs
(upstream and downstream) of cooperating enterprises and
competitors; and (4) internal communication routine repre-
senting the channels through which an enterprise achieves
organisational learning through partnerships—this is crucial
for being open and reactive. These four diverse components
support each other.
However, the concept of network capability has not been
studied in the context of environmental sustainability. Build-
ing on existing literature on networking, we propose a new
component related to the collaborative environmental rela-
tionship. This component addresses an enterprise’s ability to
enhance environmental collaboration with potential partners,
the sharing of green knowledge, and increasing the environ-
mental awareness and knowledge of managers.
There are three supporting reasons why we propose the
inclusion of this additional dimension of collaborative envi-
ronmental relationships into the multidimensional scaling
of network capability. First, environmental collaboration is
designed as a strategic reaction to environmental matters
that pays close attention to environmental protection and
encourages coordinated development of environmental and
economic views (Li 2011). Second, collaborative environ-
mental relationships envisage cooperation with stakehold-
ers, notably, suppliers, to realise environmental targets and
reduce pollution and waste (Paulraj 2011). Third, environ-
mental collaboration can encourage environmental learning
(Darnall and Edwards Jr 2006).
Thus, sustainable environmental collaboration refers to
networking and relationship between partners that share
the vision of protecting the environment, saving resources,
making relational gains, and increasing compliance. With
this new dimension, we seek to create a link between
13

environmental sustainability and networking. Enterprises
need to incorporate environmental stewardship into their
business model. There is also a requirement for building
up environmental collaboration and commercial linkage
between product development memberships and environ-
mental knowledge resources. Thus, our study evaluates the
network capability variable with five dimensions, namely:
coordination, relational skills, partner knowledge, inter-
nal communication, and the new dimension of collabora-
tive environmental relationships. Such an evaluation with
a five-dimensional network capability has not been carried
out earlier.
Network capability and eco‑innovation capability
Existing literature describes innovation capability using
multiple definitions. Laforet (2011) defined innovation capa-
bility as the ability of an enterprise to possess resources to
collaborate with others and to have the competence to solve
problems (Laforet 2011). According to Saunila and Ukko
(2012), innovation capability is the ability of an enterprise to
develop and to exploit new production processes and output
(Saunila and Ukko 2012).
To internalise the concept of environmental sustainability,
enterprises need to improve innovation capabilities at dif-
ferent levels of the production process, products, and activi-
ties (Ghassim and Foss 2020). Eco-innovation capability is
comparable to innovation capability and is designed as a
set of processes and practices that help enterprises iden-
tify, use, and exploit resources to maintain and improve
their performance (Cohen and Levinthal 1990). Thus, eco-
innovation capability is the enterprise’s ability to exploit
natural resources and develop eco-capabilities. This is linked
to eco-innovation practices, as well as the ability to avoid
environmental harm to the production system.
The Resource Bases Views (RBV) theory postulates that
the critical condition for an enterprise’s success is the abil-
ity to inspire distinctive capabilities (Aragón-Sánchez and
Sánchez-Marín 2005). Thus, to promote EIC, the enterprise
must improve activities that support network capability, by
harnessing skills that permit an enterprise to successfully
construct, address, and exploit opportunities through rela-
tionships and networks (Vesalainen and Hakala 2014). How-
ever, the lack of an enterprise’s network capability causes
a significant waste of money and time. This is because,
without networks, organisations find it challenging to deal
with environmental issues and eco-innovation practices.
With regard to corporate sustainability, some authors dem-
onstrated that eco-networking strengthens eco-innovation
capability and creates space and opportunities to share
knowledge and resources (Mellett et al. 2018). Hence, the
enterprises’ ability to cooperate with different partners and
stakeholders in the environmental context may be recognised
13
D. Ben Amara, H. Chen
as one of the successful drivers for eco-innovation capabil-
ity. In this study, we define network capability as an enter-
prise’s ability to evolve and harness relationships to provide
access to various resources owned by different stakehold-
ers in order to adopt eco-innovation practices and minimise
environmental harm. Thus, we envisage a strong relationship
between network capability and eco-innovation capability.
We state that:
H1  Network capability directly and positively influences
eco-innovation capability;
Additionally, to investigate the potential of the proposed
network capability scale, we tested and compared the four-
dimensional network capability with the five-dimensional
network capability. The new dimension proposed by us
relates to collaborative environmental relationships. As
stated, this is positively linked to eco-innovation capability.
Thus, it is hypothesised that:
H1a  Network capability with the previous four-dimensional
scale directly and positively influences eco-innovation capa-
bility; and
H1b  Network capability with the updated five-dimensional
scale directly and positively influences eco-innovation capa-
bility, and the impact is more effective as compared to the
previous four-dimensional scale.
Network capability and sustainable performance
of an enterprise
Network capability is a core strategic capability that cre-
ates a sustainable win–win situation (Walter et al. 2006).
This is because a suitable network with potent value sharing
can achieve enhanced long-term performance. The network
capability of an enterprise permits diffusion of informa-
tion with other players, anticipates new customers’ prefer-
ences, and reacts quickly to competitive actions. It also helps
develop new products and services when competitors cannot
imitate their innovation. Therefore, network capability can
help enterprises achieve optimal performance levels. Fur-
thermore, enterprises must learn to unify their capabilities
with others to find solutions to common problems and to
acquire knowledge to achieve economic and environmental
performance (McGovern 2006). This helps improve perfor-
mance, ensure customer satisfaction, and expand markets.
Thus, business growth and sustainable performance are
enabled by the development of network capability. This is
because enterprises’ resources and capabilities can increase
only through interactions and collaborations with other insti-
tutions or organisations. A strong network capability helps
enterprises acquire useful resources and achieve enhanced
Investigating the effect of multidimensional network capability and eco‑innovation…
profitability (Ying et al. 2019) and attain sustainable perfor-
mance. Furthermore, encouraging and simplifying networks
can stimulate green knowledge transfer and exchange skills.
Hence, we propose that network capability, directly and
positively, influences enterprises’ sustainable performance.
Thus, we state that:
H2  Network capability, directly and positively, influences
enterprises’ sustainable performance;
We propose to test and compare the impact of the four-
dimensional network capability and the five-dimensional
network capability models on enterprises’ sustainable per-
formance. Thus, it is hypothesised that:
H2a  Network capability with the previous four-dimensional
scale directly and positively influences enterprises’ sustain-
able performance; and
H2b  Network capability with the updated five-dimensional
scale directly and positively influences enterprises’ sustain-
able performance, and the impact is more effective than in
the previous four-dimensional scale.
The mediating role of eco‑innovation capability
Innovation has a mediator effect on networking and enter-
prises’ performance (Dolfsma and Van der Eijk 2017). We
propose that network capability will be positively connected
to eco-innovation capability and, in turn, that eco-innovation
capability will be positively connected to enterprises’ sus-
tainable performance. Therefore, we posit a mediated rela-
tionship between network capability, eco-innovation capabil-
ity, and enterprises’ sustainable performance.
Carnes and Ireland (2013) reported that networks ena-
ble the development of innovation capability by building
resources (Carnes and Ireland 2013). More notably, strong
network collaboration is a decisive factor in developing eco-
innovation capability. Therefore, an enterprise with a lower
eco-innovation capability may find it hard to implement its
practices and may underestimate the value of new ideas and
new sustainable business opportunities from the external
environment. In such a case, collaboration with other part-
ners enables the enterprise to enhance its eco-innovation
capability and helps enterprises manage their businesses
efficiently.
In contrast, in the context of sustainability, Fernando et al.
(2019) confirmed that an enterprise’s capability to eco-inno-
vate leads to enhancement of sustainable performance (Fer-
nando et al. 2019). In this respect, eco-innovation capability
is an enterprise’s dynamic capability to create new solutions
to meet customers’ current and future demands (Wang and
Dass 2017), and thus, it is the enterprise’s ability to surpass
competitors (Jeong et al. 2006). Therefore, eco-innovation
capability encourages enterprises to improve an integrated
approach to boost environmental protection and helps them
achieve sustained long-term performance. Building on
dynamic capability theory, we suggest that enterprises with
high eco-innovation capability are more likely to achieve
environmental performance, since such enterprises can create
differentiated processes and products that minimise environ-
mental harm. Hence, eco-innovation capability is crucial for
increasing an enterprise’s competitive power and achieving
sustainable performance. Therefore, eco-innovation capability
is considered an agent of transformation by fostering enter-
prises’ sustainable performance.
The mediating variable (eco-innovation capability) trans-
mits the effect of an independent variable (network capabil-
ity) on a dependent variable (enterprises’ sustainable perfor-
mance). Consequently, the mediating role of eco-innovation
capability creates evidence for how network capability effects
enterprises’ sustainable performance. Thus, we suggest that
eco-innovation capability exerts a mediating role between
network capability and enterprises’ sustainable performance.
Thus, we state:
H3  Eco-innovation capability mediates the relationship
between network capability and enterprises’ sustainable
performance;
Specifically, we suggest testing the mediating effect of the
four-dimensional network capability and compare it with the
mediating effect of the five-dimensional network capability.
Therefore, it is hypothesised that:
H3a  Eco-innovation capability mediates the relationship
between network capability with the four-dimensional model
and enterprises’ sustainable performance; and
H3b  Eco-innovation capability mediates the relationship
between network capability with the updated five-dimen-
sional model and enterprises’ sustainable performance, and
the impact is more effective than in the case of the previous
four-dimensional model.
To summarise, this study seeks to offer a new perspective
on RBV that builds upon a dynamic approach that explores the
network capability dimensions and develops eco-innovation
capability in order to achieve the enterprises’ sustainable per-
formance (Fig. 1).
13

Coordination
H1a
Relational skills
H1b
Partner knowledge
Internal communication
H2a
Four dimensions of network capability
H2b
Collaborative environmental Relaonship
Update dimensions network capability
Fig. 1  Conceptual mode
Materials and methods
The nature of this study suggests the use of quantitative
methodology to achieve the research objectives and test the
hypotheses.
Research approach
We developed a questionnaire in line with the literature on
the application of RBV to the agricultural and agri-food
sectors. The questionnaire explored data expressing the
construct of eco-strategic capabilities and enterprises’ per-
formance. Before sending the questionnaire by email, the
survey was pretested in four enterprises to verify the clarity
of the questions and to reduce measurement errors in the
questionnaire outputs. The pilot test indicated that the survey
was relatively clear and that all questions were adequately
understood. The questionnaire was subsequently evaluated
and reviewed by two university professors who specialised
in this area. Most of the questions were adopted from previ-
ous studies; the questions were written in English and then
translated into French. Before data collection, a pretest was
undertaken by mailing the questionnaire to five participants.
Then, emails were sent to participants with a cover letter
clarifying the purpose of this research, expressing gratitude
for participating, and guaranteeing the confidentiality of
shared information.
The sample involves farmers including; micro (6.75%),
small (75.52%), and medium (17.72%) food enterprises;
drink enterprises; and food transformation and services (die-
tary and organic foods, cookies, dry cakes, chocolate, meat,
and fresh poultry, bread and pastries, dairy products, feed for
animals, and fish and fruit preserves well as edible oils and
13
D. Ben Amara, H. Chen
Eco-innovation capability
H3a H3b
Enterprises’ sustainable
performance
fats) in Tunisia. We categorised the entrepreneurs according
to their status in the venture, which included: the principal
owner (42.61%), founder of the venture (37.97%), managing
director (11.40%), and others (employees) (8.01%).
The sample was chosen from enterprises registered
with the following: Agency responsible for the Promo-
tion of Agricultural Investment (APAI), Technical Center
of Organic Agriculture (TCOA), The Technical Center for
Agri-Food (TCAF), National Agency for Environmental
Protection (NAEP), National Agency For Waste Manage-
ment (NAFWM), National Agency for Energy Monitoring
(NAEM), and the Europages website (https​://www.europ​
ages.fr). The research method also involved document anal-
ysis, as well as workshop discussion and examination of
trade journal websites. The survey size was 7400 organic
agricultural and agri-food enterprises (Chebbi et al. 2019).
In the current study, we chose the Cochran sampling
technique which makes sampling more impactful (Cochran
1977). This tool selects the sample at the smallest possible
cost. According to this sampling technique, our sample size
was 365; however, we limited the survey to 237 participants.
Instruments
The present study utilised 27 items, enumerated below, con-
sisting of network capability, eco-innovation capability, and
enterprises’ sustainable performance (see Table 1):
• Network capability involves 15 items as developed by
the research of Walter et al. (2006). We designated three
items from their research to assess the previous four com-
ponents (Coordination activities, Relationship Skills,
Partner Knowledge, and Internal Communication). We
Investigating the effect of multidimensional network capability and eco‑innovation…

Table 1  Variables, sub-variables, and items

Variables Sub-variables Items (statements)

Network capability
(updated)
Eco-innovation capability
Enterprises’ sustainable performance
Coordination
Relational skills
Partner knowledge
Internal communication
Collaborative environmental -ENV1. Exploring sustainable opportunities and capturing environmental
relationships
Product innovation capability -PDIC1. In comparison with competitors, our enterprise is faster in bring-
Process innovation capability -PCIC1. Our company changes production methods at high speed in com-
-C1. We link the use of resources (e.g. personnel, finances) to the indi-
vidual relationship
-C2. We seek the information concerned our partners’ goals, potentials,
and strategies
-C3. We decide in advance which potential partners to discuss to
strengthen relationships
-RS1. We can build good personal relationships with business partners
-RS2. We can put ourselves in our partners’ position
-RS3. We can deal flexibly with our partners
-PK1. We know our partners’ markets
-PK2. We know our partners’ products/procedures/services
-PK3. We know our partners’ strengths and weaknesses
-IC1. In our enterprise, we have regular meetings for every project
-IC2. In our enterprise, employees develop informal contacts among
themselves
-IC3. In our enterprise, communication is often across projects and subject
areas
values
-ENV2. Promoting collaborative relationships in environmental issues,
sharing and transferring green knowledge
-ENV3. Increasing the environmental awareness and knowledge of man-
agers
ing new products or services into the green market
-PDIC2. In comparison with competitors, our enterprise has introduced
more eco-innovative products and services during the past 5 years
-PDIC3. New products and services in our enterprise often put us up
against new competitors
-PDIC4. Our new products and services are often perceived as innovative
by customers
parison with our competitors
-PCIC2. We are continually improving our business process
-PCIC3. The nature of the process in our enterprise is new compared with
that of our primary competitors
-PCIC4. Our future investments in new methods of production are signifi-
cant compared with our annual turnover
-P1. Our level of customer satisfaction is important
-P2. Our sales growth in established green markets
-P3. Our sales growth in new green market
-P4. Our ability to develop new methods and processes as well as new
product and services is important

changed some phrasing to be suitable for the sustainable
context and finally added the fifth component, namely
collaborative environmental relationships. Therefore, the
updated network capability in our study involves 15 items
and includes five sub-variables: Coordination activities
(3 items), Relationship Skills (3 items), Partner Knowl-
edge (3 items), Internal Communication (3 items), and
Collaborative environmental relationships (3 items)
• Eco-innovation capability involves eight items. This
variable is built on the research done by Wang and
Ahmed (2007), while assimilating a sustainable-ori-
ented context. The eco-innovation capability variable
included two sub-variables: eco-product-innovation
capabilities (4 items) and eco-process-innovation capa-
bilities (4 items) (Wang and Ahmed 2007).

13

• Enterprises’ sustainable performance includes four
items—these are developed building upon the research
of (Chandler and Hanks 1994).
A 6-point Likert scale was used to measure the items
from “strongly disagreed” (1) to “strongly agreed” (6) (Ben
Amara 2019).
Our questionnaire aimed to benefit from the professional
experience of the participants—they were asked to respond
to the following statements or questions (see Table 1):
Analyses and results
Data analysis
This study tested the appropriateness of the partial least
squares path modelling (PLS-PM). This approach uses a var-
iance-based structural equation modelling to investigate the
hypothesised relationships. We applied the two-step method
suggested by Anderson and Gerbing. We then analysed the
measurement and structural equation model in separate steps
(Anderson and Gerbing 1988).
First, we harnessed exploratory factor analysis (EFA) to
test the factorial structure of all items of the questionnaire.
The EFA was conducted in this model to investigate the
relationships and correlations between the variables (Hair
Jr et al. 2010) while decreasing the number in the statistical
construct. According to Hair et al. (2010), the best sample
size is > 100. In our study, the sample size of the EFA was
237 participants, which satisfies the sample size conditions.
We evaluated the psychometric properties of network capa-
bility to eco-innovation capability and enterprises’ sustaina-
ble performance to assess whether five-dimensional network
capability (Coordination activities, relationship skills, Part-
ner Knowledge, Internal Communication, and Collaborative
environmental relationships) is prominent and empirically
distinct from four-dimensional network capability. Then,
Harman’s one-factor test was applied to all items to investi-
gate the impendence of the common method bias. Seven dis-
tinct factors were extracted from Harman’s one-factor test,
with Eigen values greater than 1.0 (Podsakoff et al. 2003).
The un-rotated principal components factor analysis out-
comes show that the first factor only accounted for 45.33%
of the variance and no particular factor was responsible for
the majority of the variance.
Second, we evaluated the relationship between latent
and measured variables through a PLS-PM. This method
is a multi-variate technique that combines aspects of factor
analysis and regression. The PLS-PM approach maximises
the predictive precision of endogenous variables. This tech-
nique was useful because PLS-PM is adequate for predic-
tive purposes; it was selected because our conceptual model
13
D. Ben Amara, H. Chen
includes the variables and the hypothesised relationship
with direct and indirect effects, as well as mediation effects.
SmartPLS 3 software was used to analyse the data gathered
from the questionnaire survey.
Reliability and descriptive analysis
Given the development of the scale of the measurement
model, we focused on the critical psychometric properties,
namely reliability, internal consistency, convergent validity,
and discriminant validity.
• The reliability of the constructs is evaluated as the
standardised indicators’ loadings. The factor loading
demonstrates the relationship between the items and
the construct. To calculate the loading value, we used
the SmartPLS 3 software, while running consistent PLS
bootstrapping. The loading factors of all included items
ranged from 0.578 to 0.929. All factor loadings were
more significant than 0.5, which demonstrates a high
convergent validity. This is shown in Table 2.
• The internal consistency is assessed by calculating the
composite reliability (CR) and the Cronbach’s Alpha. CR
values between 0.6 and 0.7 can be considered as accept-
able in exploratory research (Hair et al. 2013). Table 2
shows that the CR of each scale ranged from 0.844 to
0.947. Despite questions raised about the utility of Cron-
bach’s Alpha as a measurement of internal consistency,
we suggest using it as a conventional measure of internal
consistency (Hair et al. 2013). Cronbach’s Alpha of each
scale ranged from 0.839 to 0.947—this is greater than
the recommended value of 0.7 (Hair et al. 2012), thus
revealing that all items have strong internal consistency.
• Convergent validity is assessed by the average variance
extracted (AVE). Table 2 reports that the value of AVE
ranged from 0.502 to 0.857—this surpasses the rec-
ommended value of 0.50 (Wong 2016). Therefore, our
model indicates good convergent validity.
• Discriminant validity is evaluated by the Fornell–Larcker
approach. According to this approach, the square root of
the AVE of each variable must be calculated and then
compared with the highest correlation of the other vari-
able in the statistical model. Table 3 reveals that all cor-
relation coefficients are different from one and less than
the square root of the AVE value for each construct (For-
nell and Larcker 1981). Thus, the convergent validity is
confirmed.
Structural model estimation
In the next step, we conducted a series of empirical
analyses to evaluate the effects of network capability on
Investigating the effect of multidimensional network capability and eco‑innovation…

Table 2  Measurement items, factor loadings

Variables Sub-variables Items Loading AVE CR Cronbach’s alpha

Network capability Coordination C1 0.814 0.639 0.844 0.839

C2 0.789
C3 0.863
Relational skills RS1 0.614 0.834 0.938 0.938
RS2 0.578
RS3 0.602
Partner knowledge PK1 0.717 0.744 0.897 0.897
PK2 0.711
PK3 0.717
Internal communication IC1 0.723 0.699 0.875 0.875
IC2 0.666
IC3 0.775
Collaborative environmental ENV1 0.672 0.857 0.947 0.947
relationships ENV2 0.675
ENV3 0.610
NC Four dimensions 0.500 0.922 0.925
NC Five dimensions 0.501 0.936 0.939
Eco-innovation capability Product innovation capability PDIC1 0.838 0.507 0.891 0.892
PDIC2 0.827
PDIC3 0.638
PDIC4 0.663
Process innovation capability PCIC1 0.697
PCIC2 0.709
PCIC3 0.644
PCIC4 0.648
Enterprises’ sustainable performance P1 0.791 0.732 0.916 0.915
P2 0.839
P3 0.858
P4 0.929

eco-innovation capability and enterprises’ sustainable per-
formance. As demonstrated in Table 4, we reported the path
coefficients and the direct–indirect effects and explained
variance (R2) value.
We performed a set of empirical tests to estimate the
influences of network capability on eco-innovation capabil-
ity and enterprises’ sustainable performance. In particular,
we disconnected the impacts of the four-dimensional net-
work capability and five-dimensional network capability in
order to examine the effect of the four-dimensional network
capability (H1a–H3a) and to compare this effect to the five-
dimensional network capability (H1b–H3b). Our eventual
objective was to explore the difference between the four- and
five-dimensional models, and to prove whether the added
fifth dimension improves explanatory power to the four-
dimensional scales.
Our result reported a significant positive relationship
between four-dimensional network capability and eco-inno-
vation capability (β = 0.200**, t = 2.293, p = 0.024). Thus,
H1a was supported. As anticipated, our five-dimensional
network capability model adds significant explanatory
power to eco-innovation capability (β = 0.482**, t = 5.197,
p = 0.000). R square is also higher. Thus, H1b was also sup-
ported. Therefore, we have found evidence and showed
that network capability, with the updated five-dimensional
network capability, directly and positively, influences eco-
innovation capability, and the impact is more effective than
in the previous four-dimensional network capability model.
Further, our findings indicated a significant positive rela-
tionship between four-dimensional network capability and
enterprises’ sustainable performance (β = 0.263** t = 2.542,
p = 0.011). Thus, H2a was also accepted. In revealing out-
comes for H2b, an important difference is noted for the five-
dimensional network capability model with a significant
direct effect (β = 0.387**, t = 3.611, p = 0.000). Thus, H2b
was also supported. Consequently, we have demonstrated
that network capability, with the updated five dimensions,
directly and positively, influences enterprises’ sustainable

13
 D. Ben Amara, H. Chen

Table 3  Descriptive and the square root of AVE (between constructs)

Correlation Mean SD Eco- Collaborative Internal Enterprises’ Partner knowl- Relational Coordination
innovation environmental communi- sustainable edge skills
capability relationships cation performance

Eco-innovation 4.159 0.953 0.712

capability
Collaborative 4.874 1.086 0.475** 0.926
environmen-
tal relation-
ships
Internal com- 4.582 1.085 0.594** 0,598** 0.836
munication
Enterprises’ 4.219 1.134 0.657** 0.473** 0,573** 0.840
Performance
Partner knowl- 4.438 1.088 0.559** 0.546** 0.664** 0.562** 0.863
edge
Relational 4.987 1.091 0.459** 0.690** 0.486** 0.417** 0.626** 0.913
skills
Coordination 4.500 1.005 0.727** 0.588** 0.692** 0.657** 0.673** 0.421** 0.799

Bold (the diagonal) indicates the square root of the AVE

**Correlation is significant at the 0.01 level (2-tailed)

Table 4  Structural model results

Relationship Model 1 (Total effect) Model 2 (Mediation effect) Supported

(a) Four-dimension
 H1a: network capability → eco-innovation capability 0.200** (t = 2.293, p = 0.024) YES
 H2b: network capability → enterprises’ sustainable performance 0.263** (t = 2.542, p = 0.011) 0.179NS (t = 1.773, p = 0.076) YES
 Eco-innovation capability → enterprises’ sustainable performance 0.424** (t = 5.307, p = 0.000)
 R2Eco-innovation 0.465
 R2Enterprises’ sustainable performance 0.525
(b) Five-dimension
 H1a: network capability → eco-innovation capability 0.482** (t = 5.197, p = 0.000) YES
 H2b: network capability → enterprises’ sustainable performance 0.387** (t = 3.611, p = 0.000) 0.182NS (t = 1.745, p = 0.081) YES
 Eco-innovation capability → enterprises’ sustainable performance 0.424** (t = 5.307, p = 0.000)
 R2Eco-innovation 0.490
 R2Enterprises’ sustainable performance 0.525

**Correlation is significant at the 0.01 level (2-tailed), ns: Not significant, Bootstrapping based on n = 1000 subsamples

performance, and the impact is more effective than in the
previous four-dimensional network capability model.
Model 1 showed a positive direct effect of network capa-
bility (four- and five dimensions) on enterprises’ sustainable
performance. Nevertheless, in the presence of a mediator
variable, namely eco-innovation capability, this direct effect
become non-significant with a trivial difference reported for
the five-dimensional model (four dimensions: β = 0.179NS,
t = 1.773, p = 0.076; five dimensions: β = 0.182NS, t = 1.745,
p = 0.081).
Model 2 indicates that the explanatory power of net-
work capability and enterprises’ sustainable performance
is reduced in the presence of eco-innovation capability. As
indicated in Table 5, the bootstrap confidence interval to
95% is bigger than zero for the indirect effect. The results,
consequently, showed that eco-innovation capability entirely
mediates the relationship between network capability and
enterprises’ sustainable performance, with a significant dif-
ference added for the five-dimensional model. Hence, H3a
and H3b were both also supported.
Therefore, the mediating variable eco-innovation capa-
bility mediates the relationship between network capability
(independent variable) with the updated five dimensions and
enterprises’ sustainable performance (dependent variable).
Consequently, the impact is more effective than in the previ-
ous four-dimensional model.

13
Investigating the effect of multidimensional network capability and eco‑innovation…
Table 5  Indirect effect of network capability dimensions on eco-innovation capability
Mediator Indirect effect
(a) Four-dimensional H3a 0.085** (t = 2.083, p = 0.042)
(b) Five-dimensional H3b 0.204** (t = 3.677, p = 0.000)
**Correlation is significant at the 0.01 level (2-tailed), Bootstrapping based on n = 1000 subsamples
Discussion and conclusions
In the current study, we tested an updated five-dimensional
network capability and investigated a proposed relationship
between network capability, eco-innovation capability, and
enterprises’ sustainable performance across our sample. Our
hypotheses proposed that network capability with a fifth new
dimension (namely collaborative environmental relation-
ships) is important for agricultural and agri-food small and
medium enterprises. It improves the level of eco-innovation
capability and achieves sustainable performance. Specifi-
cally, the present study offers the following four critical
theoretical contributions to network and innovation research.
First, the empirical result demonstrates a positive rela-
tionship between the updated five-dimensional network
capability construct and eco-innovation capability. This
relationship is also shown to be more significant than the
previous four-dimensional network capability construct.
This result is supported by Mellett et al. (2018), according
to whom networks fortify eco-innovation capability, improve
access to more resources, and create more opportunities to
share knowledge and resources. Further, the explained vari-
ance (R2) in the five-dimensional network capability vari-
able is more significant compared to the four-dimensional
model. This result supports the importance of including
the new dimension of collaborative environmental rela-
tionships. Since environmental collaboration is one of the
strategic reactions to environmental matters, entrepreneurs
need to pay closer attention to environmental protection and
encourage coordinated development of environmental and
economic views (Li 2011). An implication for managers and
entrepreneurs is that they need to increase their environmen-
tal awareness in order not only to have personal linkages
with eco-innovation practices but also to extract more sus-
tainable and economic values. Network relationships guide
enterprises towards a sustainable path and help them iden-
tify new sustainable business opportunities to enhance their
capability to adopt eco-innovation practices.
Second, we suggest an important dimension, often
ignored, of network capability related to collaborative envi-
ronmental relationships. This addition to the predominant
network capability construct built by Walter et al. (2006)
involves a dynamic view regarding network capability
conceptualisation. This identifies benefits from network
Confidence intervals (per- Confidence intervals (Bias- Supported
centile 95%) corrected)
(0.017, 0.179) (0.017, 0.179) YES
(0.104, 0.320) (0.104, 0.318) YES
relationships, while taking advantage of collaborative envi-
ronmental relationships to realise environmental targets
and reduce pollution and waste (Paulraj 2011). Further, this
sustainable dimension of the network capability construct
improves the likelihood of coordination and communication
of environmental matters and enhances knowledge transfer.
Thus, we believe that our structural analysis and the updated
network capability multidimensional scale are a significant
contribution to networking literature.
Third, we detect a significant relationship between an
updated network capability construct and enterprises’ sus-
tainable performance, which is stronger than that between
the previous network capability construct and enterprises’
sustainable performance. This leads to excellent sustain-
able performance outcomes. Wong et al. (2012) supported
this finding and suggested that the enterprise’s ability to
collaborate with partners on environmental issues permits
access to other resources and fosters the preservation of
natural resources. This leads to better sustainable perfor-
mance outcomes (Wong et al. 2012). Specifically, Dickel
et al. (2018) proposed that collaborative environmental net-
works are critical for enterprises with strong environmental
orientation. They demonstrated that these practices provide
sharing of environmental awareness between partners while
decreasing environmental uncertainty (Dickel et al. 2018).
This further leads to the achievement of sustainable perfor-
mance. Thus, eco-network capability stimulates sustaining
partnerships and relationships along the value chain—this is
a relevant skill for achieving sustainable performance. Spe-
cifically, this finding improves entrepreneurs’ understanding
of how a firm’s sustainable networking might influence its
partners’-related behaviours and choices to adopt environ-
mentally friendly practices, while maintaining economic and
sustainable performance.
Fourth, we found significant support for eco-innovation
capability as an antecedent of an updated network capability
construct and the consequence of enterprises’ sustainable
performance. Thus, eco-innovation capability is a crucial
driver and mediator of the updated network capability and
enterprises’ sustainable performance. The full-mediation
effect of eco-innovation capability supports the viability
of our model, considering the strong impact and relevance
that network capability has on the improvement of sustain-
able performance. In particular, the mediating effect reveals
13

that agricultural and agri-food enterprises will find ways to
discover the best opportunities for reaching economic and
sustainable performance. This result is supported by the
research of del Río et al. (2011). They suggested that, to
mitigate the environmental impact of the production pro-
cess, enterprises need to have the capability to engage in
networks to better predict the adoption of eco-innovations
(del Río et al. 2011) and further foster eco-innovation capa-
bility, while other researchers confirmed that the enterprise’s
capability to eco-innovate achieves and improves sustainable
performance (Fernando et al. 2019). Thus, eco-innovation
capability is an essential mechanism and mediator through
which agricultural and agri-food enterprises can extract the
benefits of networking, leading to better performance. In this
respect, these enterprises need eco-innovation capability to
take advantage of efficient network relationships, develop
eco-innovation adoption, and further sustain future competi-
tiveness and performance.
Finally, this study proposes the idea that integrating a
sustainability dimension to the multidimensional network
capability leads to enhancing both eco-innovation capabil-
ity and enterprises’ sustainable performance. This is cru-
cial for inculcating environmental concerns into Tunisian
enterprises’ business strategies. This study also provides a
relevant contribution to networking literature and sustainable
development. In this regard, we suggest our model would
make it easier for other countries, and varied sectors, to pur-
sue a sustainable path. This is because our study reinforces
collaborative environmental relationships and networking,
besides enhancing the capability of an enterprise to adopt
eco-innovation practices in order to strengthen the enter-
prise’s performance in protecting the environment and pro-
moting sustainable development.
Limitations and further research
The present study has several limitations that need to be
considered while interpreting its findings.
First, the proposed dimension of environmental collabo-
ration constitutes a useful additional component of the net-
work capability scale. However, we had the flexibility to
exclude items, as we involved only three items per dimen-
sion. Thus, future research must develop an enhanced, com-
prehensive, robust, and multidimensional scale for network
capability.
Second, our research focused on the agricultural and agri-
food sectors, characterised by a greater emphasis on reduc-
ing uncertainty and reacting quickly to new market demands.
Consequently, the ability of an enterprise to exploit the net-
work capability to develop eco-innovation is the key to bet-
ter performance. However, such a relationship needs to be
investigated further for other industries.
13
D. Ben Amara, H. Chen
Third, participants were more likely to be influenced by
emotions once the questionnaire was completed.
Fourth, we suggested that eco-innovation capability is a
key mediator that develops the positive effects of the network
capability construct and enhances sustainable performance.
Therefore, other moderators or mediators would need to be
tested to grasp the relationship between networking, eco-
innovation, and performance in sustainable development.
Implications
This article provides several implications for managers or
entrepreneurs of small and medium enterprises.
First, network capability provides a substantial organisa-
tional capability for agricultural and agri-food enterprises
to develop the responsibility of improving environmental
collaboration in order to achieve sustainable development.
Second, the importance of an improved ability to coor-
dinate relationships, shape partner competences and knowl-
edge, hold relational skills, and be involved in internal com-
munication was assumed. However, our study additionally
emphasises the importance of participation in collaborative
environmental relationships. This is because they open up
opportunities for agricultural and agri-food enterprises to
terminate poor relationships help recognise new sustainable
business opportunities and generate new solutions for envi-
ronmental damages.
Finally, agricultural and agri-food enterprises must
strongly highlight the requirement for developing eco-
innovation, given that our study discovered a robust cor-
relation between eco-innovation capability and sustainable
performance.
References
Ahuja G, Soda G, Zaheer A (2012) The genesis and dynamics of organ-
izational networks. Organ Sci 23:434–448
Anderson JC, Gerbing DW (1988) Structural equation modeling in
practice: a review and recommended two-step approach. Psychol
Bull 103:411
Aragón-Sánchez A, Sánchez-Marín G (2005) Strategic orientation,
management characteristics, and performance: a study of Span-
ish SMEs. J Small Bus Manag 43:287–308
Arranz N, Arroyabe M, Li J, Fernandez de Arroyabe, Juan C (2020)
Innovation as a driver of eco-innovation in the firm: An approach
from the dynamic capabilities theory. Bus Strat Environ
Ben Amara D (2019) Questionnaire MOTIV_EIC_PDM. Harvard
Dataverse, Harvard
Brass DJ, Galaskiewicz J, Greve HR, Tsai W (2004) Taking stock of
networks and organizations: a multilevel perspective. Acad Manag
J 47:795–817
Carnes CM, Ireland RD (2013) Familiness and innovation: resource
bundling as the missing link. Entrep Theory Pract 37:1399–1419
Chandler GN, Hanks SH (1994) Market attractiveness, resource-based
capabilities, venture strategies, and venture performance. J Bus
Ventur 9:331–349
Investigating the effect of multidimensional network capability and eco‑innovation…
Chebbi HE, Pellissier J-P, Rolland J-P, Khechimi W (2019) Rapport de
synthèse sur l’agriculture en Tunisie
Cochran WG (1977) Sampling techniques, 3rd edn. Wiley, New York
Cohen WM, Levinthal DA (1990) Absorptive capacity: a new perspec-
tive on learning and innovation. Adm Sci Q 35:128–152
Darnall N, Edwards D Jr (2006) Predicting the cost of environmental
management system adoption: the role of capabilities, resources
and ownership structure. Strateg Manag J 27:301–320
del Río P, Carrillo-Hermosilla J, Könnölä T, Bleda M (2011) Business
strategies and capacities for eco-innovation. Instituto de Empresa
Business School Working Paper No. EC8-124-I
Dickel P, Hörisch J, Ritter T (2018) Networking for the environment:
the impact of environmental orientation on start-ups’ networking
frequency and network size. J Clean Prod 179:308–316
Dolfsma W, Van der Eijk R (2017) Network position and firm perfor-
mance–the mediating role of innovation. Technol Anal Strateg
Manag 29:556–568
Fernando Y, Chiappetta J, Jose C, Wah W-X (2019) Pursuing green
growth in technology firms through the connections between envi-
ronmental innovation and sustainable business performance: does
service capability matter? Resour Conserv Recycl 141:8–20
Fornell C, Larcker DF (1981) Evaluating structural equation models
with unobservable variables and measurement error. J Mark Res
39–50
Ghassim B, Foss L (2020) How do leaders embrace stakeholder
engagement for sustainability-oriented innovation? In: New lead-
ership in strategy and communication. Springer, New York
Gulati R, Nohria N, Zaheer A (2000) Strategic networks. Strateg
Manag J 21:203–215
Hair JF Jr, Black WC, Babin BJ, Anderson RE (2010) Multivariate
data analysis. Vectors, 7th edn. Pearson Prentice Hall, London
Hair JF, Sarstedt M, Ringle Christian M, Mena JA (2012) An assess-
ment of the use of partial least squares structural equation mod-
eling in marketing research. J Acad Mark Sci 40:414–433
Hair JF, Ringle CM, Sarstedt M (2013) Partial least squares structural
equation modeling: rigorous applications, better results and higher
acceptance. Long Range Plan 46:1–12
Hoang H, Antoncic B (2003) Network-based research in entrepreneur-
ship: a critical review. J Bus Ventur 18:165–187
ITES (2017) ‘La Tunisie en 2025: Les fondements de la croissance et
du développement économique in Rapport économique complet’.
www.ites.tn/wp-conte​nt/…/Rappo​r t-final​econo​mique​-Tunis​ie-
2025-28-aout-2017-1.pdf
Jeong I, Pae JH, Zhou D (2006) Antecedents and consequences of the
strategic orientations in new product development: the case of
Chinese manufacturers. Ind Mark Manag 35:348–358
Laforet S (2011) A framework of organisational innovation and out-
comes in SMEs. Int J Entrep Behav Res 17:380–408
Li Y (2011) Research on the performance measurement of green supply
chain management in China. J Sustain Dev 4:101
McGovern P (2006) Learning networks as an aid to developing stra-
tegic capability among small and medium-sized enterprises: a
case study from the Irish polymer industry. J Small Bus Manag
44:302–305
Mellett S, Kelliher F, Harrington D (2018) Network-facilitated green
innovation capability development in micro-firms. J Small Bus
Enterp Dev 25:1004–1024
Paulraj A (2011) Understanding the relationships between internal
resources and capabilities, sustainable supply management and
organizational sustainability. J Supply Chain Manag 47:19–37
Podsakoff PM, MacKenzie SB, Lee J-Y, Podsakoff NP (2003) Com-
mon method biases in behavioral research: a critical review of
the literature and recommended remedies. J Appl Psychol 88:879
Saunila M, Ukko J (2012) A conceptual framework for the meas-
urement of innovation capability and its effects. Balt J Manag
7:355–375
Saunila M, Ukko J, Rantala T (2018) Sustainability as a driver of green
innovation investment and exploitation. J Clean Prod 179:631–641
Tolstoy D, Agndal H (2010) Network resource combinations in the
international venturing of small biotech firms. Technovation
30:24–36
Vesalainen J, Hakala H (2014) Strategic capability architecture: the role
of network capability. Ind Mark Manag 43:938–950
Walter A, Auer M, Ritter T (2006) The impact of network capabili-
ties and entrepreneurial orientation on university spin-off perfor-
mance. J Bus Ventur 21:541–567
Wang CL, Ahmed PK (2007) Dynamic capabilities: a review and
research agenda. Int J Manag Rev 9:31–51
Wang X, Dass M (2017) Building innovation capability: the role of top
management innovativeness and relative-exploration orientation.
J Bus Res 76:127–135
Wong KK-K (2016) Mediation analysis, categorical moderation analy-
sis, and higher-order constructs modeling in partial least squares
structural equation Modeling (PLS-SEM): a B2B example using
SmartPLS’, Mark Bull 26
Wong CW, Lai K-h, Shang K-C, Chin-Shan L, Leung TKP (2012)
Green operations and the moderating role of environmental man-
agement capability of suppliers on manufacturing firm perfor-
mance. Int J Prod Econ 140:283–294
Ying Q, Hassan H, Ahmad H (2019) The role of a manager’s intangible
capabilities in resource acquisition and sustainable competitive
performance. Sustainability 11:527
Publisher’s Note Springer Nature remains neutral with regard to
jurisdictional claims in published maps and institutional affiliations.
13