Purpose This study develops a sequential process model to address how to improve firm performance by responding to external stakeholder pressures in service contexts. Design/methodology/approach The model posits that external stakeholder pressures affect firm performance through organizational learning, green creativity and environmental performance. Data from 219 service firms are utilized to test the hypotheses. A sequential mediation approach is adopted to analyze the model. Findings Results reveal (1) organizational learning mediates the effects of government, customer and supplier pressures on firm performance, (2) environmental performance mediates the effect of customer pressure on firm performance, (3) organizational learning and green creativity serially mediate the effects of the three stakeholder pressures on firm performance and (4) the three external stakeholder pressures enhance firm performance through organizational learning, green creativity and environmental performance in a sequential manner. Originality/value This study originally contributes to the service literature by providing a sequential process lens to address how to improve performance by responding to external stakeholder pressures.
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