Moderating Effect of Collaborative Capability on the Relationship between Green Supply Chain Management practices and Performance of Manufacturing Firms in Kenya

Abstract

In Kenya, the growing importance of green supply chain Management is driven mainly by the escalating deterioration of the environment characterized by diminishing raw material resources, overflowing waste sites and increasing levels of pollution. Green supply chain management has emerged as a set of managerial practices that integrate environmental issues into supply chain Management. If implemented successfully, green supply chain management can be a way to achieve competitive advantage while enhancing the environmental sustainability of the firm. Therefore, there is need to establish the effect of GSCM practices on manufacturing firms’ performance and provide policy recommendations that can help encourage the adoption of more green practices. The study will also contribute to the discussion on green supply chain management practices from the perspective of their drivers and performance implications. The study sought to establish moderating effect of collaborative capability on the relationship between green supply chain management and performance of manufacturing firms in Kenya; The study adopted descriptive survey design using both qualitative and quantitative approaches. The study targeted 957 manufacturing firms in Kenya registered under the Kenya Association of Manufacturers as at the year 2017.A sample size of 386 firms was targeted and obtained by use of stratified random sampling. The theoretical background arose from the literature on competitive strategy, firm performance and green supply chain management. Primary data was collected using questionnaire that was addressed to firms operational and procurement managers. Descriptive statistics was used aided by Statistical Packages for Social Sciences version 21 to compute percentages of respondents ‘answers. Inferential statistics using multiple regression and correlation analysis was applied to assist examining relationship between the research variable. The findings showed that green procurement, green manufacturing, green distribution and green disposal had significant and positive effect on performance of manufacturing firms in Kenya. Further, collaborative capability moderates the relationship between green procurement and firm performance, relationship between green manufacturing and firm performance, relationship between green distribution and firm performance and relationship between green disposal and firm performance. As such, adoption of flexible green procurement practices through appropriate research will help the manufacturing firm to meet diverse yet drastic changing needs as well as address challenges arising from a dynamic global business environment. Therefore, it is utmost necessary for the firms to use inputs with relatively low environmental impacts. The mediation variable in this research was collaborative capability. Collaborative capability provided evidence that a company can compete in market share, increase the economy, improve product networks, and improve the socio-technical landscape. By having effective collaborative capability, companies can reduce the environmental impact argued about by external parties to significantly maintain and improve firm performance