Effect of the Sustainable Supply Chain on Business Performance- The Maquiladora Experience

Abstract

Mexican maquiladoras have a complex and intensive supply chain because they import raw materials from other countries and export their final products. This paper reports a structural equation model with three independent variables associated with supply chain sustainability (Inbound sustainability, Internal sustainability, and Outbound sustainability) and two variables related to external entities integration (Supplier integration and Customer integration). Those variables are related to three dependent variables as sustainability indicators (Business performance, Social performance, and Environmental performance). Variables are related by ten hypotheses that are validated using the partial least squares technique integrated into WarpPLS v.7r software, and information comes from 187 responses to a questionnaire applied to managers and engineers laboring at the Mexican maquiladora industry. The research objective is to know the relationship among variables to increase performance based on sustainable activities. Findings indicate that, given the nature of maquiladora industry, Supplier integration does not moderate the relationship between Inbound sustainability and Internal sustainability. In addition, Customer integration does not moderate the relationship between Internal sustainability and Outbound sustainability. However, the Business performance has a high effect from Social performance, Environmental performance, Internal sustainability and Outbound sustainability.