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SCM 12
SCM 12
SCM 12
Article
Green Supply Chain Management Practices of Firms with
Competitive Strategic Alliances—A Study of the
Automobile Industry
Hassan Abbas * and Shu Tong *
Abstract: Supply chain management is described as a business strategy that provides operative man-
agement of financial, material, and other information flows to ensure harmonization in distributed
organizational structures. The predefined aim of this study was to describe the effects of green supply
chain management practices on competitive strategic alliances using automobile firms in China. The
study aimed to demonstrate different factors that aid strategic alliances, which automobile firms must
acknowledge to improve their performance. Fifty automobile firms were used as the study popula-
tion. The respondents were senior managers of five active areas in each automobile firm. There were
a total of 420 respondents, among whom 320 respondents were selected by the convenience sampling
method. The study was quantitative, while the data source was primary; the data were obtained
using a closed-ended questionnaire as the major instrument for data collection. This closed-ended
questionnaire was sent to the intended respondents via email and WeChat simultaneously. Five
active areas were included, and Cronbach’s alpha values were measured for each area. The values
obtained ranged from 0.8 to 0.9, revealing the data’s consistency and reliability. The primary data
obtained were analyzed using descriptive statistics for demographic data and inferential structural
equation modeling (SEM) for multivariate data. Considering the outcomes of the research analysis, it
was concluded that forming competitive strategic alliances in firms to manage green supply chains
could bring several benefits.
Keywords: supply chain management; green supply chain management; firm performance
Intercompany alliances are often viewed as a recent phenomenon, and many rela-
tionships between organizations have existed since the companies were founded [11].
Companies competing in a modern business environment can not only create new alliances
but also gain access to resources and technologies as well as new markets, procedures,
and intellectual resources to create synergistic connections [12] and long-term competitive
advantages. Strategic alliances are often used to gather knowledge from outside the com-
pany [12,13]. It is believed that close relationships between customers and suppliers and
other business relations have numerous technical, financial, and strategic advantages [14].
Presently, strategic alliances are considered a crucial part of a modern business strategy. In
the context of an international business environment, which requires concentration and
flexibility, strategic alliances act as a driving force behind operational efficiency [15]. To
achieve differentiated products with high efficiency, speed, and quality in this more com-
plex environment, companies must focus on their core competencies and external resources
in order to gain additional resources, technical capabilities, and training [16]. The GSCM
practices considered by researchers demonstrate the characteristics of outsourcing, lean
practices, sharing of quality information, customer relationships, and strategic supplier
partnerships [17]. GSCM practices are significant for the management of the sustainable
performance of firms [18]. Cases where companies were accused of not following sustain-
able SCM practices have revealed the importance of following GSCM practices to enhance
performance and ensure the development of a good brand image [19].
Despite the extensive literature on this subject, the theoretical understanding of how
such intercompany and intracompany alliances affect working dynamics and job content is
far from complete [20]. Some authors have pointed out that this may be partly due to early
research that focused more on the motivations for and results of forming effective alliances
than on how alliances influence the management style, working atmosphere, and culture of
the organization [21]. The best way to study alliances is not only to consider them from the
perspective of front-facing processes but also to consider the continuous activities required
to maintain them and the reduced energy during their life cycle [22]. This view means that
the nature of the company’s internal work depends directly on what is required to maintain
alliance activities and productivity as well as the need to coordinate the use of knowledge
and other resources [2].
This study proposes to define a strategic alliance as a voluntary agreement based on
trust and dedication between interdependent partners, sharing resources in a way that
disrupts the opportunistic behavior of any individual partner and offers added value
for all partners [23]. According to this definition, the agreement can differ in the degree
of formality, which can be vertical or horizontal [24]. Shared resources can be based
on physical elements or knowledge. However, when the frequency of alliance formation
increases, the creation of such intercompany connections is often accompanied by instability,
poor performance, and unexpected early termination.
Given their growing influence on the changing nature of business environments and
the probability of frequent failure, accurately identifying and understanding the events
or factors that influence the dynamics and outcomes of strategic alliances has become
paramount [25]. Thus, this study fills the gap by examining the influence of green supply
chain management practices (as events or factors) on strategic alliances using five key
factors (manufacturing, eco-design, reverse logistics, procurement, and transportation) as
measures of strategic alliances. This is because the authors believe that these factors are
pertinent for the actualization of strategic alliances, especially among automobile firms.
Furthermore, these factors constitute a key instrument for understanding firms’ working
dynamics and job content [19]. However, no single theory can fully describe and explain
the nature of strategic alliance outcomes.
Sustainability 2023, 15,
Sustainability 2023, 15, 2156
x FOR PEER REVIEW 3 3of
of 22
21
Figure 1. Study Model of Green Supply Chain Management Practices. Source: Researcher,
Researcher, 2022.
2022.
Hypothesis 5 (H5). There is no significant correlation between green supply chain performance
management and transportation in automobile firms.
2. Literature Review
2.1. Supply Chain Management
The phrase “supply chain management” (SCM) has been widely used in the West for
more than 15 years, but there is no consensus among logistics and general management
professionals on the definition of this concept [1,26]. Many consider SCM from an opera-
tional point of view, referring to material flows, while others see SCM as a management
concept or use SCM to introduce the concept in the enterprise [1–3,26,27]. The most popular
definition of SCM is that it is a collection of different approaches that help in effectively inte-
grating suppliers, distributors, manufacturers, and retailers [4]. Supply chain management
describes the process of establishing and managing a distribution network associated with
delivering desired products to desired locations over a certain period of time [28]. Consid-
ered in another way, supply chain management is presented as an organizational structure
in which products are transferred from producers to consumers, which covers the entire
process, starting with the purchase of raw materials and delivery of goods and ending with
the final product being provided to customers [29]. Supply chain management is a special
management strategy that can be used to synchronize the links in a chain to optimize the
time and cost of delivering goods [27,30]. It refers to managing and controlling processes
primarily related to the production, transportation, distribution, and purchase of products
throughout the supply chain [27,31]. Currently, supply chain management is described as
one of the most profitable and effective ways to increase profits and market share, and it is
actively being introduced into the economies of industrialized countries [4–6,32]. Several
big companies have adopted SCM principles as a new business ideology.
However, if the supply chain comprises the best network structure, it is usually imperative
to change the logistics network structure to add value to the organization [7,9,10,33]. The need
to change the structure can be caused by changes in strategic decisions in the supply chain
and by various internal and external factors, such as changes in legislation or in the type
of demand, or limited opportunities for suppliers. All of these factors can result in the re-
engineering of the logistics network. This is a complex organizational task that can be solved
by applying strategic supply chain management and advanced technologies [12,14,34,35].
Companies that participate in the same supply chain cannot work in isolation from each
other. Instead, they have to work closely together in an integrated manner; in this way,
they can solve a broader range of tasks. If each company starts with its own goal, this can
lead to unnecessary boundaries between the companies, reducing the efficiency of the flow
process and increasing costs [17–21].
Organizations can meet the needs and requirements of their customers while spread-
ing awareness of the social, ecological, and economic aspects, three important aspects
of sustainability that can inform the production and delivery of services [36]. In other
words, GSCM practice is designed to help companies maintain processes and have strong
control over the supply chain. Moreover, it helps in gaining a competitive advantage by
integrating dynamic skills. Sustainable development practices related to the supply chain
are important to improve tracking and traceability while simultaneously meeting the needs
and requirements of customers at a broad level [37]. These practices lead to the complexity
of the supply chain process and increase the number of risks. Companies coordinate their
efforts to manage these complexities as the supply chain becomes increasingly integrated.
In this respect, integration is one of the most effective ways to manage the supply chain
and achieve optimal performance [38]. The effectiveness of green supply chain manage-
ment within supply chain management suggests that green supply chain management
techniques are effective as indicators of internal and external pressure in different supply
chains. Providing training courses on implementing GSCM practices will effectively ensure
that such implementation increases an organization’s competitive advantage in terms of
effective supply management [39].
In supply chain management, a collaborative relationship is an effective way to pro-
mote the supply chain’s presence. The critical review of the research studies revealed
that supplier collaboration is a vital approach for the management of different operations
of the supply chain [62]. Empirical testing has demonstrated that supplier collaboration
can improve elements of the supply chain such as risks, rewards, and knowledge sharing
as well as supply chain management. The use of collaboration in the supply chain is
imperative for small- and medium-sized organizations [52].
IT can assist companies in exchanging information effectively with their partners
and integrating customer relationship management, and ERP applications can ensure
supply chain management [63]. Currently, supply chain management has a significant
role in managing and meeting customers’ demands and ensuring that global competition
is satisfied. With the evolution of technology, technological techniques and practices are
the prime factors that can ensure the integration of the supply chain with the company’s
value system [64]. Integrating techniques and practices related to IT can result in effec-
tive supply chain management, which can improve the effectiveness and profitability of
firms. In addition, investing in integrating IT into supply chain management can lead to
positive outcomes, including competitive advantages. The development of technology
and advancement in the already present technological aspects has led to competition. The
competitive landscape has prompted organizations to gain a competitive advantage by
operating efficiently and increasing their production in different areas [65]. Faster develop-
ments in technology have led to significant global competition. In this regard, the efficiency
and competitive benefits of organizations depend on increased productivity and operating
efficiency, and for this purpose, integrating technology is imperative [36,66,67].
The use of IT is effective for fostering relationships among different operational activi-
ties in the organization and ensuring effective communication to improve the performance
of the supply chain [47]. The implementation of supply chain management strategies
involving the use of IT can lead to significant positive outcomes [50]. Competition be-
tween the supply chains of different organizations has increased the value of supply chain
improvements. In this regard, approaches are considered for the effective management
of supply chain performance to improve the performance of firms [52]. The sharing of
information is a collaborative endeavor, and it occurs with other management practices so
that the supply chain can bring improvements in the process.
2.2.3. Green Supply Chain Management for Effective Integration of Strategic Alliances
The motivation for forming strategic alliances positively affects the degree of partners’
integration with them [61]. It has been suggested that companies are more likely to be
more flexible and less restrictive, such as by forming strategic alliances, in the face of
Sustainability 2023, 15, 2156 8 of 21
challenges [85]. In green supply chain management, an SCM logistic scorecard (LSC) is
used, which is based on assessing the impact of any corporate strategy in terms of alignment,
logistic performance, capability of planning or execution, and implementation [86–88]. It is
a simple and effective tool used in several countries. The impact of competitive strategic
alliances on firm performance is measured using financial indicators [89], including return
on assets and cash-to-cash cycle time.
3. Methodology
The green supply chain performance measurement model (GSPM) model was used to
evaluate the effectiveness of competitive strategic alliances in the performance of selected
firms. This model was designed to integrate green supply chain management practices,
balanced scorecards, and LSC using five factors for measurement: manufacturing, procure-
ment, reverse logistics, eco-design, and transportation. These factors are key instruments
in competitive strategies, so a five-level rating was used for evaluation as these five factors
represent best practices.
A standard design process was followed to rule out bias and confirm validity. Auto-
mobile companies were used as the study population. Automobile companies are a main
industrial sector in many nations, and they play a primary role in economic development.
Among the automobile companies in China, 50 were selected as they were considered to
be involved in inter- or intrafirm alliances to implement green supply chain management
practices in order to gain a competitive advantage. The respondents were senior managers
of five active areas in each automobile firm who were believed to have vast knowledge of
the study problem. The sample size for this study was initially 420 respondents, and 320 re-
spondents were selected by convenience sampling. The convenience sampling method
gives researchers the liberty to use their discretion in choosing a sample size that would be
manageable to work with.
This study is quantitative, while the data source is primary. Quantitative data obtained
from automobile firms involved in intra- or interfirm alliances were considered to evaluate
the impact of green supply chain management practices on competitive strategic alliances.
Primary data were collected from the responses of senior managers of 50 major automobile
firms across the provinces of China with the aid of a closed-ended questionnaire as the
major instrument for data collection. The human resource departments of these firms sent
an introductory letter stating the study’s title and purpose and requesting the intended
respondents’ contact information. The letter also assured them of strict confidentiality
with regard to any information provided. It took strenuous author effort to convince the
management of these firms to participate due to fear of espionage. After frequent visits,
elaboration, and feedback, the contact information of the intended respondents was given.
After that, the closed-ended questionnaire and directions were sent simultaneously via
email and WeChat to these respondents. Another limitation experienced at this point
was the unenthusiastic nature of the respondents and their bias based on their differences
(values, understanding, beliefs, and religion). However, suitable responses were obtained
after assuring them of confidentiality.
Five active areas were used, and the value of Cronbach’s alpha was measured for each
area. The value obtained ranged from 0.8 to 0.9, which revealed the data’s consistency and
reliability. The primary data obtained by the use of a questionnaire were analyzed using
descriptive statistics for demographic data and inferential structural equation modeling
(SEM) for multivariate data.
4. Results
A total of 320 questionnaires were distributed to the respondents. All 320 were duly
filled and returned, representing a 100% response rate. All responses were measured on a
five-level rating, ranging from “strongly disagree” to “strongly agree”. The demographic
profile of respondents is given in Table 1. The analysis of respondents’ ages revealed that
113 respondents (35.3%) were in the 31- to 35-year-old age group (highest number), and
Sustainability 2023, 15, 2156 10 of 21
31 of the respondents (9.7%) were in the 40 years and above group (lowest number). Age
signifies maturity, and it is common logic that mature individuals possess more cognitive
capacity. The analysis of respondents’ provinces indicated that 85 respondents (26.6%)
were from Guangdong (highest number), while only 8 respondents (2.5%) were from
either Chongqing, Shandong, or Jiangsu (lowest number). It is common logic that more
industrious provinces produce competent individuals. The analysis of the respondents’
current employment status revealed that 92 respondents (28.8%) were managers of eco-
design and 79 (24.7%) were transportation managers. In comparison, 36 respondents
(11.3%) were production managers. It is common logic that specialists or managers in these
areas are competent respondents.
Figure
Figure 2. 2. Measurement
Measurement Model
Model ofof Green
Green SupplyChain
Supply ChainPerformance
PerformanceManagement.
Management.
Table
4.1.2.2.Measurement
Measurement model
Modelanalysis
of Areaofof
green supply chain (Figure
Manufacturing performance
3) management.
Chi-Square Table 3 lists the measurement model analysis results for Standardized manufacturing to determine
Model (df), Signifi- goodnessNFIof fit. According
TLI to
CFI the results,
RMSEA chi-square had
Variable a value of 225,
Factor NFI had aError
Loading value of
1.05, and TLI had a value of 0.96. RMSEA had a value of 0.060, and the VAR
standardized factor
cance Estimate
loading estimate was 0.76. Model analysis confirms that the variable is reliable enough as a
Green supply
(5 df) factor for the measurement of competitive strategic alliances.
chain performance 0.96 0.95 0.98 0.043 GSCPM1 0.67 0.34
5.86, p > 0.000
management Table 3. Measurement model analysis of manufacturing.
GSCPM2 0.89 0.44
Chi-Square (df), GSCPM3 0.74
Standardized 0.41
Model NFI TLI CFI RMSEA Variable Factor Loading Error VAR
Significance
GSCPM4 0.72
Estimate 0.38
Manufacturing
(67 df) Source: Amos
1.05
24.0 output
0.96
on research data, 2022.0.06
0.95 AoM1 0.76 0.54
255, p > 0.000
AoM2 0.77 0.25
4.1.2.
Sustainability 2023, 15, x FOR PEER REVIEW Measurement Model of Area of Manufacturing (Figure
AoM3 3) 0.74 0.46
12 of 22
AoM4 0.89 0.38
Table 3 lists the measurement model analysis results for manufacturing to determine
Source: Amos 24.0 output on research data, 2022.
goodness of fit. According to the results, chi-square had a value of 225, NFI had a value
of 1.05, and TLI had a value of 0.96. RMSEA had a value of 0.060, and the standardized
factor loading estimate was 0.76. Model analysis confirms that the variable is reliable
enough as a factor for the measurement of competitive strategic alliances.
Figure
Figure 3. Measurement
3. Measurement model
model of Area
of Area of manufacturing.
of manufacturing.
Standardized Fac-
Chi-Square (df), Error
Model NFI TLI CFI RMSEA Variable tor Loading Esti-
Significance VAR
mate
Figure 3. Measurement model of Area of manufacturing.
Sustainability 2023, 15, 2156 12 of 21
Table 3. Measurement model analysis of manufacturing.
Standardized Fac-
Chi-Square (df), Error
Model 4.1.3. Measurement
NFI TLIModelCFI
of Area of Transportation
RMSEA Variable(Figuretor
4) Loading Esti-
Significance VAR
Table 4 lists the measurement model analysis results to determinemate goodness of fit in
(67 df)the measurement model in the transportation area. According to the results, chi-square
Manufacturing 1.05 0.96 0.95 0.06 AoM1 0.76 0.54
had a value of 60.5, NFI had a value of 0.98, TLI had a value of 1.04, RMSEA had a value of
255, p > 0.000
0.054, and the standardized factor loading estimate
AoM2was 0.83. The0.77 model analysis0.25shows
that the variable is a reliable factor for measuring
AoM3competitive strategic
0.74 alliances. 0.46
AoM4 0.89 0.38
Table 4. Measurement model analysis of transportation.
Source: Amos 24.0 output on research data, 2022.
Chi-Square (df), Standardized Factor
Model NFI TLI CFI RMSEA Variable Error VAR
Significance 4.1.3. Measurement Model of Area of Transportation (FigureLoading
4) Estimate
(49 df)
Transportation
60.5, p > 0.000
Table
0.98 4 lists the
1.04 measurement
1.00 model
0.054 analysis
ARLresults
1 to determine
0.83 goodness of0.44fit in
the measurement model in the transportation area. ARL 2 According to0.81
the results, chi-square
0.56
ARL 3 0.72 0.09
had a value of 60.5, NFI had a value of 0.98, TLIARL had4 a value of 1.04,
0.69 RMSEA had a value
0.51
of 0.054, and the standardized factor loading
Source: Amos 24.0 output on research data, 2022. estimate was 0.83. The model analysis shows
that the variable is a reliable factor for measuring competitive strategic alliances.
Figure
Figure4.4.Measurement
MeasurementModel
ModelofofArea
Areaof
ofTransportation.
Transportation.
Figure
Figure6.6.Measurement
MeasurementModel
ModelofofArea
AreaofofEco-Design.
Eco-Design.
Table
4.1.6.6.Structural
Measurement model analysis
Covariance Modelofofeco-design.
Green Supply Chain Performance Management and
Measures of Competitive Strategic Alliances (Transportation, Manufacturing, Reverse
Logistics, Procurement, and Eco-Design) (Figure 7) Standardized Fac-
Chi-Square (df), Error
Model NFI TLI CFI RMSEA Variable tor Loading Esti-
Significance Table 7 lists the Structural Covariance Model of Green Supply Chain Performance
VAR
mate
Management and Measures of Competitive Strategic Alliances (Transportation, Manufac-
(78 df)
Eco-design 1.04 1.06 1.01 0.036 AED 1 0.89 0.55
541, p > 0.000
AED 2 0.74 0.56
AED 3 0.71 0.29
Sustainability 2023, 15, 2156 14 of 21
turing, Reverse Logistics, Procurement, and Eco-Design). The test of hypothesis 1, there
is a significant correlation between green supply chain performance management and
manufacturing. The recorded values of β = 87 and CR = 1.99 (p < 0.05) indicate that green
supply chain performance management can explain 87% of the variation in manufacturing.
the test of hypothesis 2 indicate that there is a significant correlation between green supply
chain performance management and transportation. The recorded values of β = 77 and
CR = 3.11 (p < 0.05) indicate that green supply chain performance management can explain
77% of the difference in the area of transportation. The recorded values of β = 78 and
CR = 3.08 (p < 0.05) indicate that green supply chain performance management can explain
78% of the difference in the area of reverse logistics. Hypothesis 4 show that eco-design as
a measure of competitive strategic alliances is related to green supply chain performance
management, with values of β = 96 and CR = 2.18 (p < 0.05). This result indicates that
green supply chain management can explain 96% of the variance in the area of eco-design.
Test of hypothesis 5 show that procurement as a measure of competitive strategic alliances
is related to green supply chain performance management, with values of β = 85 and
CR = 2.21 (p < 0.05). This indicates that green supply chain management can explain 85%
of the variance in procurement.
FigureFigure 7. Structural
7. Structural Covariance
Covariance Model.Model.
6. Managerial Implications
This study can enable the managers of automobile firms and other related firms to
prioritize the implementation of green supply chain management. This can facilitate the
achievement of sustainable goals and the minimization of effluent wastes and hazardous
chemicals, thereby improving environmental efficiency all through the supply chain [19].
This can also involve better transactional processes, supply chain enhancement, designing
of services and products based on special considerations, waste-free circuit enhancement,
better recycling, reclamation of raw materials, and facilitation of reused products.
This study can also enable managers to build strategic alliances in order to promote
effective firm performance such that they appreciate the critical role of green supply chain
management. This supports the view that collaborating with suppliers can lead to positive
outcomes, as GSCM practices can increase economic performance and create a competitive
advantage for firms [50].
Additionally, the study makes it clear that practitioners need to incorporate green sup-
ply chain management as a critical catalyst of firm performance. This is in agreement with
the claim that supply chains are important for improving tracking and traceability while
simultaneously meeting the needs and requirements of customers on a broad level [37].
This is also in line with the views of Boon-itt and Wong, who asserted that customer satis-
faction should be of the utmost importance to organizations as they engage in identifying,
understanding, and utilizing customer requirements with the objectives of producing
customer-defined goods/products and increasing benefits to the organization [100].
7. Conclusions
The serious risks that environmental uncertainty presents are making the general
public and the business community more aware of environmental issues. Businesses, espe-
cially those in the manufacturing industry, have been pressured to adopt environmentally
friendly processes and products in order to keep up their strategic competitiveness. In
addition to offering protection against environmental uncertainty, GSCM can also enhance
firm performance, which is why it is becoming more well liked among academics and
practitioners. While previous studies mostly examined the role of GSCM in improving a
firm’s environmental performance, this study was conducted to inform policy makers and
other relevant stakeholders about the role of green supply chain management practices in
competitive strategic alliances as a way to ascertain performance levels in automobile firms.
A sample size of 320 was used for this purpose. The outcomes of the analyses revealed
that green supply chain management practices influence the competitive strategic alliances
of firms, thereby predicting the level of performance they can attain. Green supply chain
management, a proxy for green supply chain management practices, correlates with various
factors used to measure competitive strategic alliances. Green supply chain performance
management ensures the reuse and recycling of raw materials, purchase of raw materials,
optimal upstream movement of products and materials, total quality, waste reduction, high
productivity, binding together of the supply chain, product identification, better sourc-
ing, and vetting of strategic sources. It also enhances environmental sustainability and
management.
Based on the same outcomes, it was further concluded that competitive strategic
alliances of firms promote management of the green supply chain, resulting in better per-
formance. Firms are now pursuing sustainability goals and have made strategic alliances
to implement management practices for green supply chains. There are a few recommenda-
tions related to this research, one of which is to consider different types of strategic alliances
to compare their outcomes.
Author Contributions: All authors contributed to study conception and design. The first draft of the
manuscript was written by H.A., and all authors commented on previous versions of the manuscript.
All authors have read and agreed to the published version of the manuscript.
Funding: This research received no external funding.
Sustainability 2023, 15, 2156 18 of 21
Data Availability Statement: The data will be available from the corresponding author upon a
reasonable request.
Conflicts of Interest: The authors declared no conflict of interest.
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