Can entrepreneurial orientation improve sustainable development through leveraging internal lean practices?

Abstract

This study aims to examine the mediating role of internal lean practices (ILPs) on the relationship between entrepreneurial orientation and triple bottom line performance (i.e. environmental, social, and operational performance). We examine Chile, which represents a vibrant economy and one of the world's most productive entrepreneurship ecosystems but with a history of socio‐economic inequalities and strong profit‐driven pressures to overextract natural resources. The study is based on a questionnaire related to manufacturing sent to 112 companies in Chile. The proposed relationships are analysed through structural equation modelling. The results indicate that ILPs fully mediate the effect of entrepreneurial orientation on environmental performance and social performance and partially mediates the effect of entrepreneurial orientation on operational performance. Our study extends the literature by explaining that entrepreneurial orientation builds and strengthens ILPs for creating triple bottom line competitive advantage.

Innovativeness and lean practices for triple bottom line: testing of fit-as-mediation versus fit-as-moderation models

“…Many scholars argue innovation and LPs may be complimentary. LPs are known to help reduce waste and contribute to the environmental dimension of TBL while driving operational excellence (Cherrafi et al, 2017;King and Lenox, 2001;Kumar and Rodrigues, 2020;Chavez et al, 2020). Lean is more related to incremental rather than radical innovation (Abdallah et al, 2019); though in some cases it can drive radical innovation (Kim et al, 2012).…”

“…Achieving TBL means firms need not only create value for shareholders, but also protect the environment around and the lives of the people they serve (Wu et al, 2015). While LPs can decrease cost by reducing waste, it must reduce impacts to both the environment and society (Chavez et al, 2020;Dhingra et al, 2014). It has been suggested that synergies can be obtained by simultaneously addressing all three TBL dimensions using innovative ideas (Pagell and Wu, 2009).…”

“…In addition, the literature on the relationship between LPs and environmental performance (e.g., Hajmohamad et al, 2013) and social performance (e.g., Brown and OÕRourke, 2007) has reached mixed conclusions. The inconclusive and sometimes contradictory empirical results require further investigation of the LPsÐTPL performance relationship (Chavez et al, 2020;Yang et al, 2011).…”

“…This study adds new knowledge about the sources of TBL. How firms achieve TBL performance is an area that remains underdeveloped (Chavez et al, 2020;Glavas and Mish, 2017). While most scholars would agree that lean is associated with green, our findings show lean is also associated with the social aspect of TBL.…”

“…The sustainability literature calls for explanations of how TBL can be achieved and yet the topic remains under-researched (Chavez et al, 2020;Glavas and Mish, 2017). While previous studies examine the effect of LPs on individual dimensions of TBL (e.g., Eroglu and Hofer, 2011;Jayaram et al, 2008;Wong and Wong, 2014;Yang et al, 2011), this study investigates the effects of LPs and innovativeness on individual as well as aggregated performance.…”