FACTORS INFLUENCING SUSTAINABLE PERFORMANCE OF ORGANIZATION: A CASE OF MANUFACTURING FIRMS IN INDIA

Abstract

This thesis ascertains the factor influencing sustainable business performance of manufacturing firms in India. Given the little emphasis by academicians and practitioners concerning the factors influencing sustainable business performance, present study called for exploring the influence of organizational level factors on sustainable business performance in the manufacturing firms in India. Manufacturing firms contribute significantly to India’s growth, but on the contrary, they partially contribute to environmental degradation. With changing times, organizations are realizing the essence of environmental and social sustainability while attaining financial viability. Initially systematic review process was adopted to identify the gaps and constructs of the study. The present study intends to identify the antecedents of sustainable business performance in Indian manufacturing firms. These antecedents are institutional pressure, green human resource management practices, organizational culture, knowledge management process, and top management role. Manufacturing firms located in different states of India have been selected as the unit of analysis. Using a simple random sampling method, 750 junior, middle, and senior-level employees were contacted to seek their responses on the survey questionnaire. Relevant literature has been reviewed to develop a questionnaire measuring all the constructs used in the study. Respondents have responded to questions measuring variables: coercive pressure, normative pressure, competitive pressure, green recruitment and selection, green training and development, green performance measurement, green empowerment, green reward and compensation, involvement, consistency, adaptability, mission, knowledge acquisition, knowledge dissemination, knowledge responsiveness, top management support, top management commitment, social performance, economic performance, and environmental performance. SPSS, AMOS 27 and PROCESS macro were used to analyze the results. After preliminary testing of normality, multicollinearity, outliers, common method bias, measurement models were tested for reliability and validity. Structural equation modeling using AMOS 27.0 version has been used to check the validity of constructs and test the hypothesized relationships among them and mediation effect was tested using model four of PROCESS macro. Institutional pressure, green HRM practices, and top management role have positively influenced sustainable business performance. In contrast, organizational culture has negatively influenced sustainable business performance. The knowledge management process mediates the relationship i between institutional pressure, green HRM practices, top management role, and sustainable business performance. On the contrary, there is no mediation between organizational culture and sustainable business performance through knowledge management process. In the present study, institutional pressure, green HRM practices, top management role, and knowledge management process have been found to act as enablers of sustainable business performance. This thesis implies that manufacturing firms must take initiatives to build sustainability oriented culture, knowledge management process, engage active participation of their employees in order to achieve their sustainability goals. Organizations must respond to institutional pressures as an opportunity to enhance their sustainability performance. Employees who have participated in the survey affirmed that an effective knowledge management process, top management support and commitment, green human resource practices, and institutional level pressure helps the organization in achieving the goal of sustainable business performance. The role of organizational learning, transformational leadership, organizational citizenship behaviour and innovation capabilities has remains unexplored in the study. The influence of organizational learning, transformational leadership, organizational citizenship behaviour, innovation capabilities on sustainable business performance need to explored with other antecedents like top management role, knowledge management process, institutional pressure, and green HRM practices. Most of the respondents for the study were junior, middle, and senior managers. Responses of Chief Executive officers, Managing Directors, and senior board members can be further explored. This study has considered the knowledge management process the only mediating variable; other mediating variables like organizational citizenship behaviour, transformational leadership, innovation capabilities, and organizational culture can be explored. The study is conducted in manufacturing industries like Cement, Food Processing, Pharmaceuticals, and Steel. Sustainability practices may differ industry-wise. This study is based on quantitative assessment and it needs further exploration through qualitative analysis. Each enabler of sustainable business performance identified for the present study needs further exploration and detailed study in the Indian manufacturing context. A comparative study between public and private manufacturing industries can be carried out to see the difference on sustainable performance of both the industries. A qualitative study with focus group interviews with top-level executives can help analyze the problem more in-depth. The framework developed from qualitative analysis or the in-depth interview method could be further established. Thus, adopting a ii mixed-method approach can verify the phenomenon of sustainable business performance in a better way. The study can be applied in other sectors like Banking, Tourism, Education, and Service sector. Longitudinal study can be carried out in the future.