A Systems Modeling Approach to Support Environmentally Sustainable Business Development in Manufacturing SMEs
Small and Medium Sized Enterprises (SMEs) play an important role in many economies. In New Zealand, for example, 97% of all manufacturing companies employ less than 100 staff, and generate the predominant part of this industry sector-s economic output. Manufacturing SMEs as a group also have a significant impact on the environment. This situation is similar in many developed economies, including the European Union. Sustainable economic development therefore needs to strongly consider the role of manufacturing SMEs, who generally find it challenging to move towards more environmentally friendly business practices. This paper presents a systems thinking approach to modelling and understanding the factors which have an influence on the successful uptake of environmental practices in small and medium sized manufacturing companies. It presents a number of causal loop diagrams which have been developed based on primary action research, and a thorough understanding of the literature in this area. The systems thinking model provides the basis for further development of a strategic framework for the successful uptake of environmental innovation in manufacturing SMEs.
[1] Shahbazpour, M. and R. Seidel. Using sustainability for
competitive advantage in 13th CIRP International Conference on
Life Cycle Engineering. in 13th CIRP International Conference on
Life Cycle Engineering. 2006. Leuven, Belgium.
[2] Collins, E., et al., Business networks and the uptake of
sustainability practices: the case of New Zealand. Journal of
Cleaner Production, 2007. 15: p. 729e740.
[3] Williamson, D., G. Lynch-Wood, and J. Ramsay, Drivers of
environmental behaviour in manufacturing SMEs and the
implications for CSR. Journal of Business Ethics, 2006(67): p.
317-330.
[4] Zuber-Skerritt, O., Action Learning and Action Research:
Paradigm, Praxis and Programs, in Effective Change
Management through Action Research and Action Learning:
Concepts, Perspectives, Processes and Applications. 2001,
Southern Cross University Press: Lismore, Australia. p. 1-20.
[5] Statistics New Zealand. New Zealand Business Demographics.
2008 [cited 20 August 2008]; Available from: www.stats.govt.nz/.
[6] Maani, K. and R. Cavana, Systems Thinking, System Dynamics -
Managing Change and Complexity. 2007, Auckland: Pearson
Education New Zealand.
[7] Doppelt, B., Leading Change Towards Sustainability: A Change
Management Guide for Business, Government, and Civil Society
2003, Sheffield: Greenleaf Publishing.
[8] Senge, P., The Fifth Discipline: The Art and Practice of the
Learning Organization. 1990, New York: Doubleday/Currency.
[9] Sterman, J.D., Business Dynamics: Systems thinking and modeling
for a complex world. 2000: McGraw Hill.
[10] Seidel, M., et al., A Systems Approach to the Implementation of
Environmentally Benign Practices in Manufacturing SMEs, in
15th CIRP International Conference on Life Cycle Engineering.
2008: Sydney.
[11] Seidel, R.H.A., Shahbazpour, M. and Seidel, M.C, Establishing
Sustainable Manufacturing Practices in SMEs, in 2nd
International Conference on Sustainability Engineering and
Science, Talking and Walking Sustainability. 2007: Auckland.
[12] Jenkins, H., Corporate social responsibility - engaging SMEs in
the debate. 2004, Research Centre for Business Relationships,
Accountability, Sustainability and Society.
[13] Vives, A., Social and environmental responsibility in small and
medium enterprises in Latin America. 2005, Inter-American
Development Bank: New York.
[14] Mandl, I., CSR and competitiveness - European SMEs good
practice. 2005, Grant Programme of the European Commission:
Vienna.
[15] Willard, B., The Next Sustainability Wave: Building Boardroom
Buy-In. 2005, Gabriola Island: New Society Publishers.
[16] Epstein, M.J. and M.-J. Roy, Strategic evaluation of
environmental projects in SMEs. Environmental Quality
Management, 2000: p. 37-47.
[17] Shrivastava, P., The role of corporations in achieving ecological
sustainability. The Academy of Management Review, 1995. 20(4):
p. 936-960.
[18] Kerr, I.R., Leadership Strategies for Sustainable SME Operation.
Business Strategy and the Environment, 2006. 15: p. 30-39.
[19] Petts, J., A. Herd, and M. O-Heocha, Environmental
responsiveness, individuals and organizational learning: SME
Experience. Journal of Environmental Planning and Management,
1998. 41(6): p. 711-730.
[20] Biondi, V. and F. Iraldo, Achieving sustainability through
environmental innovation: the role of SMEs. International Journal
of Technology Management, 2002. 24(5/6): p. 612-626.
[21] R. Hillary, Small and Medium-sized enterprises and the
environment: Business imperatives. 2000, Sheffield: Greenleaf.
[22] NetRegs, NetRegs Benchmarking Survey: How green are small
businesses? A snapshot of environmental awareness and practice
in small and medium sized enterprises (SMEs). 2002.
[23] NetRegs, SME-nvironment 2005: A review of changing
environmental attitudes and behaviours among small and
medium-sized businesses in the UK. 2005.
[24] Friedman, A. and S. Miles, SMEs and the environment: Two case
studies. Eco-Management and Auditing, 2001. 8: p. 200-209.
[25] Groundwork, Small firms and the Environment. 1995,
Groundwork Foundation: Birmingham.
[26] Pimenova, P. and R. van der Vorst, The role of support
programmes and policies in improving SMEs environmental
performance in developed and transition economies. Journal of
Cleaner Production, 2004. 12: p. 549-559.
[27] Tilley, F., The gap between environmental attitudes and
environmental behavior of small firms. Business Strategy and the
Environment, 1999. 8: p. 238-248.
[28] Perez-Sanchez, D., J.R. Barton, and D. Bower, Implementing
environmental management in SMEs. Corporate Social
Responsibility and Environmental Management, 2003. 10: p. 67-
77.
[29] Rutherfoord, R., R. Blackburn, and L. Spence, Environmental
management and the small firm: An international comparison.
International Journal of Entrepreneurial Behaviour and Research,
2000. 6(6): p. 310-325.
[30] Shearlock, C., P. Hooper, and S. Millington, Environmental
Improvement in Small to Medium-Sized Enterprises: A Role for
the Business-Support Network. Greener Management International,
2001(30): p. 50-60.
[31] Schaper, M., The challenge of environmental responsibility and
sustainable development: Implications for SME and
entrepreneurship academics, in Radical Changes in the World:
Will SMEs Soar or Crash? 2002: St Gallen: Switzerland.
[32] Gerstenfeld, A. and H. Roberts, Size matters: Barriers and
prospects for environmental management in small and mediumsized
enterprises, in Small and Medium-Sized Enterprises and the
Environment, R. Hillary, Editor. 2000, Greenleaf Publishing:
Sheffield. p. 106-118.
[33] Le Pochat, S., G. Bertoluci, and D. Froelich, Integrating ecodesign
by conducting changes in SMEs. Journal of Cleaner Production,
2007. 15: p. 671-680.
[34] Lefebvre, É., L.A. Lefebvre, and S. Talbot, Life Cycle Design
Approach in SMEs. International Journal of Life Cycle
Assessment, 2001. 6/5: p. 273-280.
[35] Petts, J., et al., The climate and culture of environmental
compliance within SMEs. Business Strategy and the Environment,
1999. 8: p. 14-30.
[36] Envirowise, Attitudes 2000 - Attitudes and Barriers towards
Improved Environmental Performance. 2000.
[37] Masurel, E., Why SMEs invest in environmental measures:
Sustainability evidence from small and medium-sized printing
firms. Business Strategy and the Environment, 2007. 16: p. 190-
201.
[38] Bansal, P. and K. Roth, Why companies go green: A model of
ecological responsiveness. The Academy of Management Journal,
2000. 43(4): p. 717-736.
[39] Williamson, D. and G. Lynch-Wood, A new paradigm for SME
environmental practice. The TQM Magazine, 2001. 13(6): p. 424-
432.
[40] Rodriguez, J. Internationalisation Awareness in the Small Firm. in
International Council for Small Business 48th World Conference.
2003. Belfast.
[41] Hitchens, D., et al., Competitiveness, environmental performance
and management of SMEs. Greener Management International,
2003(Winter).
[42] Bansal, P. and K. Roth, Why companies go green: A model of
ecological responsiveness. Academy of Management Journal,
2000. 43(4): p. 717-736.
[43] Sharma, S., Managerial Interpretation and organisational context
as predictors of corporate choice of environmental strategy.
Academy of Management Journal, 2000. 43(4): p. 681-697.
[44] Epstein, M.J. and M.-J. Roy, Sustainability in Action: Identifying
and Measuring the Key Performance Drivers. Long Range
Planning, 2001. 34: p. 585-604.
[45] Schuman, M.C., Managing legitimacy: strategic and institutional
approaches. Academy of Management Review, 1995. 20: p. 571-
610.
[46] Garvey, G.E., The Theory of the Firm, Managerial Responsibility,
and Catholic Social Teaching. Journal of Markets & Morality,
2003. 6(2): p. 525-540.
[47] Menguc, B. and L.K. Ozanne, Challenges of the "green
imperative": a natural resource-based approach to the
environmental orientation-business performance relationship.
Journal of Business Research, 2005. 58: p. 430-438.
[48] Hart, S.L., A natural resource-based view of the firm. Academy of
Management Review, 1995. 20(4): p. 986-1014.
[49] Biondi, V., M. Frey, and F. Iraldo, Environmental Managment
Systems and SMEs: Motivations, Barriers and Opportunities
Related to EMAS and ISO 14001 Implementation. Greener
Management International: The Journal of Corporate
Environmental Strategy and Practice (GMI), 2000. Spring: p. 55-
69.
[50] Studer, S., R. Welford, and P. Hills, Drivers and barriers to
engaging small and medium-sized companies in voluntary
environmental initiatives. 2005, The University of Hong Kong:
Hong Kong.
[51] Hillary, R., Environmental management systems and the smaller
enterprise. Journal of Cleaner Production, 2004. 12(6): p. 561-569.
[52] Anglada, M.L., Small and medium-sized enterprises - perceptions
of the environment: A study from Spain, in Small and Medium-
Sized Enterprises and the Environment, R. Hillary, Editor. 2000,
Greenleaf Publishing: Sheffield. p. 62-74.
[53] Simpson, M., N. Taylor, and K. Barker, Environmental
responsibility in SMEs: Does it deliver competitive advantage?
Business Strategy and the Environment, 2004. 13: p. 156-171.
[54] Shahbazpour, M. and R. Seidel. Using Sustainability for
Competitive Advantage. in LCE 2006, 13th CIRP International
Conference on Life Cycle Engineering. 2006. Leuven, Belgium.
[55] Allen, D., et al., Environmentally Benign Manufacturing: Trends
in Europe, Japan, and the USA. Journal of Manufacturing Science
and Engineering, 2002. 124: p. 908-920.
[1] Shahbazpour, M. and R. Seidel. Using sustainability for
competitive advantage in 13th CIRP International Conference on
Life Cycle Engineering. in 13th CIRP International Conference on
Life Cycle Engineering. 2006. Leuven, Belgium.
[2] Collins, E., et al., Business networks and the uptake of
sustainability practices: the case of New Zealand. Journal of
Cleaner Production, 2007. 15: p. 729e740.
[3] Williamson, D., G. Lynch-Wood, and J. Ramsay, Drivers of
environmental behaviour in manufacturing SMEs and the
implications for CSR. Journal of Business Ethics, 2006(67): p.
317-330.
[4] Zuber-Skerritt, O., Action Learning and Action Research:
Paradigm, Praxis and Programs, in Effective Change
Management through Action Research and Action Learning:
Concepts, Perspectives, Processes and Applications. 2001,
Southern Cross University Press: Lismore, Australia. p. 1-20.
[5] Statistics New Zealand. New Zealand Business Demographics.
2008 [cited 20 August 2008]; Available from: www.stats.govt.nz/.
[6] Maani, K. and R. Cavana, Systems Thinking, System Dynamics -
Managing Change and Complexity. 2007, Auckland: Pearson
Education New Zealand.
[7] Doppelt, B., Leading Change Towards Sustainability: A Change
Management Guide for Business, Government, and Civil Society
2003, Sheffield: Greenleaf Publishing.
[8] Senge, P., The Fifth Discipline: The Art and Practice of the
Learning Organization. 1990, New York: Doubleday/Currency.
[9] Sterman, J.D., Business Dynamics: Systems thinking and modeling
for a complex world. 2000: McGraw Hill.
[10] Seidel, M., et al., A Systems Approach to the Implementation of
Environmentally Benign Practices in Manufacturing SMEs, in
15th CIRP International Conference on Life Cycle Engineering.
2008: Sydney.
[11] Seidel, R.H.A., Shahbazpour, M. and Seidel, M.C, Establishing
Sustainable Manufacturing Practices in SMEs, in 2nd
International Conference on Sustainability Engineering and
Science, Talking and Walking Sustainability. 2007: Auckland.
[12] Jenkins, H., Corporate social responsibility - engaging SMEs in
the debate. 2004, Research Centre for Business Relationships,
Accountability, Sustainability and Society.
[13] Vives, A., Social and environmental responsibility in small and
medium enterprises in Latin America. 2005, Inter-American
Development Bank: New York.
[14] Mandl, I., CSR and competitiveness - European SMEs good
practice. 2005, Grant Programme of the European Commission:
Vienna.
[15] Willard, B., The Next Sustainability Wave: Building Boardroom
Buy-In. 2005, Gabriola Island: New Society Publishers.
[16] Epstein, M.J. and M.-J. Roy, Strategic evaluation of
environmental projects in SMEs. Environmental Quality
Management, 2000: p. 37-47.
[17] Shrivastava, P., The role of corporations in achieving ecological
sustainability. The Academy of Management Review, 1995. 20(4):
p. 936-960.
[18] Kerr, I.R., Leadership Strategies for Sustainable SME Operation.
Business Strategy and the Environment, 2006. 15: p. 30-39.
[19] Petts, J., A. Herd, and M. O-Heocha, Environmental
responsiveness, individuals and organizational learning: SME
Experience. Journal of Environmental Planning and Management,
1998. 41(6): p. 711-730.
[20] Biondi, V. and F. Iraldo, Achieving sustainability through
environmental innovation: the role of SMEs. International Journal
of Technology Management, 2002. 24(5/6): p. 612-626.
[21] R. Hillary, Small and Medium-sized enterprises and the
environment: Business imperatives. 2000, Sheffield: Greenleaf.
[22] NetRegs, NetRegs Benchmarking Survey: How green are small
businesses? A snapshot of environmental awareness and practice
in small and medium sized enterprises (SMEs). 2002.
[23] NetRegs, SME-nvironment 2005: A review of changing
environmental attitudes and behaviours among small and
medium-sized businesses in the UK. 2005.
[24] Friedman, A. and S. Miles, SMEs and the environment: Two case
studies. Eco-Management and Auditing, 2001. 8: p. 200-209.
[25] Groundwork, Small firms and the Environment. 1995,
Groundwork Foundation: Birmingham.
[26] Pimenova, P. and R. van der Vorst, The role of support
programmes and policies in improving SMEs environmental
performance in developed and transition economies. Journal of
Cleaner Production, 2004. 12: p. 549-559.
[27] Tilley, F., The gap between environmental attitudes and
environmental behavior of small firms. Business Strategy and the
Environment, 1999. 8: p. 238-248.
[28] Perez-Sanchez, D., J.R. Barton, and D. Bower, Implementing
environmental management in SMEs. Corporate Social
Responsibility and Environmental Management, 2003. 10: p. 67-
77.
[29] Rutherfoord, R., R. Blackburn, and L. Spence, Environmental
management and the small firm: An international comparison.
International Journal of Entrepreneurial Behaviour and Research,
2000. 6(6): p. 310-325.
[30] Shearlock, C., P. Hooper, and S. Millington, Environmental
Improvement in Small to Medium-Sized Enterprises: A Role for
the Business-Support Network. Greener Management International,
2001(30): p. 50-60.
[31] Schaper, M., The challenge of environmental responsibility and
sustainable development: Implications for SME and
entrepreneurship academics, in Radical Changes in the World:
Will SMEs Soar or Crash? 2002: St Gallen: Switzerland.
[32] Gerstenfeld, A. and H. Roberts, Size matters: Barriers and
prospects for environmental management in small and mediumsized
enterprises, in Small and Medium-Sized Enterprises and the
Environment, R. Hillary, Editor. 2000, Greenleaf Publishing:
Sheffield. p. 106-118.
[33] Le Pochat, S., G. Bertoluci, and D. Froelich, Integrating ecodesign
by conducting changes in SMEs. Journal of Cleaner Production,
2007. 15: p. 671-680.
[34] Lefebvre, É., L.A. Lefebvre, and S. Talbot, Life Cycle Design
Approach in SMEs. International Journal of Life Cycle
Assessment, 2001. 6/5: p. 273-280.
[35] Petts, J., et al., The climate and culture of environmental
compliance within SMEs. Business Strategy and the Environment,
1999. 8: p. 14-30.
[36] Envirowise, Attitudes 2000 - Attitudes and Barriers towards
Improved Environmental Performance. 2000.
[37] Masurel, E., Why SMEs invest in environmental measures:
Sustainability evidence from small and medium-sized printing
firms. Business Strategy and the Environment, 2007. 16: p. 190-
201.
[38] Bansal, P. and K. Roth, Why companies go green: A model of
ecological responsiveness. The Academy of Management Journal,
2000. 43(4): p. 717-736.
[39] Williamson, D. and G. Lynch-Wood, A new paradigm for SME
environmental practice. The TQM Magazine, 2001. 13(6): p. 424-
432.
[40] Rodriguez, J. Internationalisation Awareness in the Small Firm. in
International Council for Small Business 48th World Conference.
2003. Belfast.
[41] Hitchens, D., et al., Competitiveness, environmental performance
and management of SMEs. Greener Management International,
2003(Winter).
[42] Bansal, P. and K. Roth, Why companies go green: A model of
ecological responsiveness. Academy of Management Journal,
2000. 43(4): p. 717-736.
[43] Sharma, S., Managerial Interpretation and organisational context
as predictors of corporate choice of environmental strategy.
Academy of Management Journal, 2000. 43(4): p. 681-697.
[44] Epstein, M.J. and M.-J. Roy, Sustainability in Action: Identifying
and Measuring the Key Performance Drivers. Long Range
Planning, 2001. 34: p. 585-604.
[45] Schuman, M.C., Managing legitimacy: strategic and institutional
approaches. Academy of Management Review, 1995. 20: p. 571-
610.
[46] Garvey, G.E., The Theory of the Firm, Managerial Responsibility,
and Catholic Social Teaching. Journal of Markets & Morality,
2003. 6(2): p. 525-540.
[47] Menguc, B. and L.K. Ozanne, Challenges of the "green
imperative": a natural resource-based approach to the
environmental orientation-business performance relationship.
Journal of Business Research, 2005. 58: p. 430-438.
[48] Hart, S.L., A natural resource-based view of the firm. Academy of
Management Review, 1995. 20(4): p. 986-1014.
[49] Biondi, V., M. Frey, and F. Iraldo, Environmental Managment
Systems and SMEs: Motivations, Barriers and Opportunities
Related to EMAS and ISO 14001 Implementation. Greener
Management International: The Journal of Corporate
Environmental Strategy and Practice (GMI), 2000. Spring: p. 55-
69.
[50] Studer, S., R. Welford, and P. Hills, Drivers and barriers to
engaging small and medium-sized companies in voluntary
environmental initiatives. 2005, The University of Hong Kong:
Hong Kong.
[51] Hillary, R., Environmental management systems and the smaller
enterprise. Journal of Cleaner Production, 2004. 12(6): p. 561-569.
[52] Anglada, M.L., Small and medium-sized enterprises - perceptions
of the environment: A study from Spain, in Small and Medium-
Sized Enterprises and the Environment, R. Hillary, Editor. 2000,
Greenleaf Publishing: Sheffield. p. 62-74.
[53] Simpson, M., N. Taylor, and K. Barker, Environmental
responsibility in SMEs: Does it deliver competitive advantage?
Business Strategy and the Environment, 2004. 13: p. 156-171.
[54] Shahbazpour, M. and R. Seidel. Using Sustainability for
Competitive Advantage. in LCE 2006, 13th CIRP International
Conference on Life Cycle Engineering. 2006. Leuven, Belgium.
[55] Allen, D., et al., Environmentally Benign Manufacturing: Trends
in Europe, Japan, and the USA. Journal of Manufacturing Science
and Engineering, 2002. 124: p. 908-920.
@article{"International Journal of Business, Human and Social Sciences:60056", author = "Manuel Seidel and Rainer Seidel and Des Tedford and Richard Cross and Logan Wait", title = "A Systems Modeling Approach to Support Environmentally Sustainable Business Development in Manufacturing SMEs", abstract = "Small and Medium Sized Enterprises (SMEs) play an important role in many economies. In New Zealand, for example, 97% of all manufacturing companies employ less than 100 staff, and generate the predominant part of this industry sector-s economic output. Manufacturing SMEs as a group also have a significant impact on the environment. This situation is similar in many developed economies, including the European Union. Sustainable economic development therefore needs to strongly consider the role of manufacturing SMEs, who generally find it challenging to move towards more environmentally friendly business practices. This paper presents a systems thinking approach to modelling and understanding the factors which have an influence on the successful uptake of environmental practices in small and medium sized manufacturing companies. It presents a number of causal loop diagrams which have been developed based on primary action research, and a thorough understanding of the literature in this area. The systems thinking model provides the basis for further development of a strategic framework for the successful uptake of environmental innovation in manufacturing SMEs.
", keywords = "Environmentally benign manufacturing, SMEs, Systems modeling.", volume = "2", number = "12", pages = "1276-9", }
