How Innovation and Digital Leadership Boost Sustainable Manufacturing

What is it about?

Advancing industrialization and rapid climate change have significantly impacted the global consumption of natural resources, leading to an increased ecological burden and affecting countries' prosperity. This study aims to enhance the sustainable performance of manufacturing firms in Pakistan through innovation capabilities and green process innovation, using a quantitative approach involving data from 299 employees. The findings show a significant correlation between innovation capabilities, green process innovation, and sustainable performance, with digital leadership enhancing creative skills and sustainable outcomes. Green product innovation mediates the relationship between innovation capability, green process innovation, and sustainable performance, while digital leadership moderates this relationship. The study underscores the importance of innovation capability and green processes in developing green product innovation and achieving sustainable performance. However, it is limited to the manufacturing sector and private firms, suggesting future research could compare private and public sector firms.

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Photo by Jakub Żerdzicki on Unsplash

Photo by Jakub Żerdzicki on Unsplash

Why is it important?

This research is crucial because it addresses the pressing global issue of sustainable performance in the manufacturing sector, particularly in Pakistan. The study highlights the significant impact of innovation capabilities and green process innovation on sustainable business practices, which are essential for reducing environmental burdens and enhancing socio-economic prosperity. Furthermore, it emphasizes the role of digital leadership in fostering innovation and sustainability, offering practical insights for manufacturing firms looking to improve their competitive position and sustainability performance. Key Takeaways: - Significant Correlation: The study found a strong correlation between innovation capabilities, green process innovation, and sustainable performance, indicating that these factors are critical for enhancing a firm’s sustainability. - Mediating and Moderating Roles: Green product innovation mediates the relationship between innovation capabilities and sustainable performance, while digital leadership moderates this relationship, underscoring the importance of leadership in driving sustainable innovation. - Strategic Implications: The research suggests that adopting green management techniques and digital leadership can significantly improve a firm's innovative competencies and overall performance, providing a strategic pathway for achieving sustainable competitive advantage.