Application of Industry 4.0 tools to empower circular economy and achieving sustainability in supply chain operations

Abstract

This study considers how effective South African manufacturing enterprises have used Industry 4.0 tools and applications to achieve sustainability in supply chain operations. Organization Information Processing Theory (OIPT) suggests Industry 4.0 tools should enhance operational capabilities. South African manufacturers were surveyed and 200 responses were received. Partial least squares structural equation modelling (PLS-SEM) was used to test the conceptual model. We provide evidence that using Industry 4.0 tools to improve resource consumption rate and reduce waste and pollution is most likely to enhance sustainable supply chain operations. Both the control orientation and the flexible orientation of the production team enhance their ability to generate positive sustainable outcomes from Industry 4.0 use. The results may not be generalizable to other, less developed nations, which struggle with Industry 4.0 implementation but should generalize to other developing nations. This study has a clear implication that there are viable pathways to sustainable supply chain operations, driven by Industry 4.0 applications, through improving resource consumption and reducing waste and pollution.

Keywords:

• Industry 4.0
• circular economy
• organization information processing theory
• remanufacturing
• sustainability

Disclosure statement

No potential conflict of interest was reported by the author(s).

Additional information

Notes on contributors

Surajit Bag

Surajit Bag is an Associate Professor of Practice at the College of Business and Economics, Department of Transport and Supply Chain Management, University of Johannesburg, South Africa. Prior joining academia, Dr. Surajit has served manufacturing industries of repute for eleven years eight months at various senior positions that include Section Head: Supply Chain Department at Tega Industries, South Africa plant. His substantive areas of research interest comprise of Industry 4.0, circular economy and supply chain sustainability. He has published research work in ABDC-A and A* ranked journals. Dr. Surajit is the proud recipient of “AIMS-IRMA Young Management Researcher Award 2016” for his significant contribution towards management research.

Lincoln C. Wood

Lincoln C. Wood is an Associate Professor at the University of Otago (New Zealand) and an Adjunct Research Fellow at Curtin University (Western Australia). He is the Editor-in-Chief of the International Journal of Applied Logistics. His research follows two broad themes, first, improving sustainable and social outcomes through operations and supply chain management practices, with a particular focus on applications in the construction sector. His research examines sustainable supply chain practices and considers ethical and privacy issues when using supply chain technologies and the management of operational disruptions. Second, investigation of dynamic logistics relationships and the use of technology with a focus on 3PLs and logistics service providers.

Arnesh Telukdarie

Arnesh Telukdarie is a Professor at the University of Johannesburg. He holds a PhD in Chemical Engineering and is a professional registered engineer. Prof Telukdarie is a consulting engineer in Industry 4.0 and digital business. Prof Telukdarie has published widely in Cleaner technologies and Industry 4.0 in global journals.

V. G. Venkatesh

V. G. Venkatesh is an Associate Professor in Supply Chain Management with EM Normandie Business School, France. His teaching and research interests are in global procurement, logistics, sustainability, and technology applications. He can be contacted at [email protected].