Impact of Institutional Pressure on Competitive Advantage: The Mediating Role of Sustainable Supply Chain Management Practices

Abstract

Purpose: The main purpose of this research is to investigate the impact of institutional pressure on competitive advantage with the mediating role of sustainable supply chain management practices.

Design/Methodology/approach: The current study is quantitative. The survey approach was chosen as the research strategy. The Statistical Package for Social Sciences (SPSS) version 22. The software was applied for Exploratory Factor Analysis (EFA). Analysis of Moment Structures (AMOS) software version 22 was applied for Confirmatory Factor Analysis (CFA). Data was collected from 373 managers in Pakistani manufacturing industries using a structured questionnaire. Targeted individuals working in industries include those dealing with sustainability issues, such as the leather, steel, textile, and rice industries. Completed questionnaires collect primary data. The current study is based on the Resource Based View (RBV) theory.

Findings: This research found that institutional pressure has a significant direct impact on competitive advantage. Further, sustainable supply chain management practices have a substantial direct impact on competitive advantage. Besides, sustainable supply chain management practices mediate the relationship between institutional pressure and competitive advantage. In general, the findings of this study provide substantial support for all of the hypotheses regarding direct and indirect effects.

Practical Implication: This research will help managers and practitioners achieve long-term corporate sustainability, vital firm performance, sustainable competitive advantage, and value creation.

Original/Value: This research attempts to make a significant contribution to the current body of knowledge. The study is novel in terms of understanding the pressures for implementing sustainable supply chain management practices in Pakistan's manufacturing industries. Stakeholders can successfully implement sustainable supply chain management practices in day-to-day operations by understanding the contextual relationships between pressures and sustainable supply chain management practices. This study also adds empirical support to the RBV theory.