The nexus of technological innovation, green product/process innovation and environmental strategy: the path towards sustainability-based competitive advantage

Abstract

This paper aims to enhance our understanding of (1) how technological innovation relates to the greening of processes and products, leading to a stronger competitive market position, and (2) how a formal environmental strategy influences these relationships. We develop a moderated double-mediation conceptual model and empirically test it using data from employees responsible for environmental and technological issues in 225 large and medium-sized firms. The results show that technological innovation’s effect on sustainability-based competitive advantage is sequentially double-mediated by green process and product innovation, and that environmental strategy significantly moderates (strengthens) the link between technological innovation and green process innovation. In today’s high-tech and environmentally conscious landscape, technological innovation must be closely tied to the greening of processes and products, and managed through a carefully crafted environmental strategy to strengthen firm competitive advantage. Our findings advance the technology-environment nexus in the strategic management literature by combining natural-resource-based view (NRBV) and dynamic capabilities theory (DCT). We contribute to a more holistic understanding of how competitive advantage depends not only on resource availability but also on the ability to dynamically reconfigure and enhance these resources in response to changing environmental and technological landscapes.

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